This happens all the time in software where a product finds great market fit with a small audience and then *absolutely destroys itself* going after a bigger audience. Potential addressable market is meaningless. Different segments have different needs, different conversion rates. - ThreadSky

spavel.bsky.social • 3 days ago

This happens all the time in software where a product finds great market fit with a small audience and then *absolutely destroys itself* going after a bigger audience.

Potential addressable market is meaningless. Different segments have different needs, different conversion rates.

Reposted from the Mountain Goats

this is correct, but some questions that might be asked in response to this state of play: what is the value of "reach"? can something be good and useful if it reaches a smaller audience, or do we believe that scale is always and everywhere the goal? Has scaling to the highest reach served us well?

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helios-daedalus.bsky.social•3 days ago

At least one company I worked for had a niche audience that a handful of employees could have serviced perfectly and still been cashflow positive. Instead, the company wanted to chase unicorn status, balooned in size and eventually collapsed when it could not make any money.

vortexegg.com•3 days ago

The best (most functional at being a business and w/ a social good mission) company I ever worked for had a great b2b product until they IPO’d and realized it couldn’t possibly “rocket ship”, tried and failed to chase an expanded market, and then pivoted to selling the company to the highest bidder

helios-daedalus.bsky.social•3 days ago

Many such cases! Growth is literally impossible in some cases (without substantially pivoting your product or diversifying outside your base of expertise), and the number of businesses who fail in the attempt is pretty staggering.

vortexegg.com•3 days ago

The real irony was that the entire mission of this company was predicated on the idea that there are limits to growth (in electricity generation) and the answer was to drive down extraneous consumer demand to lower total energy usage. And yet when it came to running a stable business…

helios-daedalus.bsky.social•3 days ago

I used to work for a company that mainly serviced the photgraphy industry. Turns out that's not a massive growth segment!

vortexegg.com•3 days ago

Their original market was US utility companies, and it worked because US energy regulations created the necessary conditions for product market fit; but this is a finite market and they had already tapped it out, and while profitable, the logic of IPO demanded continuous and exponential growth

spavel.bsky.social•3 days ago

Bsky being a "tiny echo chamber" is perfectly fine if that's the audience you want. The value of every eyeball is proportionally higher because you know they want what you have.

This is why there are so many novelists on Blueksy and Truth Social has guys who sell supplements made from ferret urine.

spavel.bsky.social•3 days ago

Bluesky has 33 million users. Let's imagine for a second that they are all queer radical communists. Well then they are the perfect audience for your queer radical communist romance murder mystery novel.

They might convert (buy your book) at a 10x rate compared to the general population.

spavel.bsky.social•3 days ago

By contrast, if you're dumping time and money advertising on the general internet, with a relatively low proportion of queer radical communists, most of those resources are simply waste because they're seen by people who are more interested in the ferret urine supplements.

spavel.bsky.social•3 days ago

What good is that to you? Until all 33 mil bskies have bought that book, pursuing the greater market is worse ROI.

The only reason to complain about Bluesky is if you DON'T have market fit. People on here don't want your piss pills. The conversion rate is lower than the general population's.

justicar.xyz•3 days ago

People keep looking at social media networks as eyeballs, because that’s the common model.

But social media networks have intrinsic value…more than extrinsic value. Same as, say, television news.

If people stopped trying to make money (or were prevented from it) we’d all be better off.

retronymous.com•3 days ago

do you think there is greater pressure than there used to be to chase a wide audience rather than refining a great, targeted product? (or is it just investors chasing 📈 for an exit)

thinking about a bunch of tools I used that did exactly what you describe above there

spavel.bsky.social•3 days ago

VC is a huge part of it the narrative of Growth For Ever has infected every corner of the market. In the same way that every website uses React even though it was created to fulfill the needs of Facebook, and most website needs look nothing like Facebook's.

wnstn.bsky.social•3 days ago

extremely accurate analysis, there's finally a book that summarizes it well: World Eaters. Talks about how much the tech industry we have is shaped by VC incentives.

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