David Cummings on Startups

Boil the Ocean or Wait for the Tide to Rise

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David Cummings

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There’s an entrepreneurial tendency to try and be all things to all people. The thinking goes that if some pain or need in the market has been identified, why not service it since we’re trying to build a company. Generally, I like to think about two common strategies and often pick the one that’s simpler:

  • Boil the Ocean – The idea is to tackle the largest, most general problem in a market and build a solution that will be most ubiquitous (think Dropbox for file sychronizing or where Mailchimp is heading with email marketing).
  • Set Sail and Wait for the Tide to Rise – Pick a more narrowly defined segment of the market, typically the small-to-medium sized business area since they can adopt a solution faster, and then as the market grows, slowly move up market (think Salesforce.com for customer relationship management).

Almost always, entrepreneurs go after the boil the ocean strategy and subsequently fail. Implementing the strategy of setting sail on a specific course and then waiting for the tide to rise before expanding is a more successful approach.

What else? What are your thoughts on the boil the ocean strategy as well as the wait for the tide to rise strategy?

Comments

5 responses to “Boil the Ocean or Wait for the Tide to Rise”

  1. theotherbottomline Avatar
    theotherbottomline

    Because I’m new at this I have a narrow focus and am waiting for the tide to rise. As I grow and learn, I’ll probably boil the ocean!

    Reply
  2. Damian Thompson Avatar
    Damian Thompson

    I am a BIG fan of narrowing your focus to find a repeatable revenue stream. It is easier to make small shifts in expanding your market when you have a customer base.

    This is a pretty big topic in the bootstrapped community. Linchpin Podcast 002 – Niching Down Like a Boss | http://bit.ly/1fUH9QG

    Reply
  3. jlc Avatar
    jlc

    I definitely advocate the wait for the tide to rise strategy in most situations. The only time boil the ocean makes sense is when a company has plenty of funding and their business model depends on broad scale to succeed.

    Reply
  4. Mark Gavagan Avatar
    Mark Gavagan

    David,

    A terrific point in this post, but do you have some some specific strategies for selecting the market more narrowly defined segment?

    Craigslist at first focused geographically on San Francisco.

    LinkedIn was naturally people in business looking to connect their network (just brilliant)

    Facebook, of course began as Harvard only, then rolled out to other Ivy’s.

    Twitter today is for an enormous and diverse set of users and uses, but it wasn’t geared towards a particular segment at launch, except perhaps by its nature and SXSW public debut (younger tech-savvy early adopters).

    My team is building what will be the world’s largest social opinion network (God willing. I wholeheartedly agree with your idea to begin in a narrow niche that falls in love with you before scaling, but what steps do you suggest to choose a narrow market in which to focus when the goal and current capability is to serve them all?

    Thank you.

    Reply
  5. sleicest Avatar
    sleicest

    Good article Dave. Nicely put.

    Mark,- one idea may be to use other companies customer complaints (access via consumer watchdog publications?) as an initial filter, then segment on complaint type to identify critical mass niche demand? There may be a way to get free complaint referrals from companies who don’t plan to introduce a solution themselves..It’s also a short journey from complaints to customer voting analytics (for improvements they want to see soon, whether from corporates, governments or charity providers). Good luck.

    Reply

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