The power of niche

In the early stages of building a business, it’s easy to believe that casting a wide net will catch more customers. After all, why limit yourself? Anyone with a budget looks like a potential sale. It’s a common trap. Many founders fear that narrowing their focus will turn business away. But here’s the hard truth: trying to be everything to everyone usually means you’re special to no one. Marketing messages become vague. Sales pitches sound generic. Prospects don’t connect, and growth stalls.

The businesses that scale fastest don’t try to please everyone — they go narrow and deep. They clarify exactly who their core customer is and what urgent, painful problem they solve. If your idea of a target market is “anyone who might pay,” it’s time to sharpen up. Identify your Ideal Customer Profile — the specific segment that gets the most value from what you do and is willing to pay for it.

Successful companies know precisely what they can be the best at — and who benefits most. It’s not theory; it’s what separates those who grow sustainably from those who plateau. When you define a specific customer and build a compelling value proposition around their pain, everything gets easier. Marketing lands. Sales conversations click. Your message finally resonates with the people it’s meant for. And suddenly, you’re not pushing uphill to win business — the right customers are coming to you.

Our own journey to specialisation

Let me share a bit of my own journey. At Monkhouse & Company, we didn’t always have absolute clarity on our niche. In the early days of my coaching practice, I was happy to help any business leader with growth ambitions. We got decent results, but our positioning was diluted. My website spoke to a broad audience, and our inbound leads were a mixed bag – some great fits, many not so much.

The turning point came when we looked hard at where we delivered the most extraordinary value. Patterns emerged. The clients getting the biggest breakthroughs were founder-CEOs nearing that critical scale-up phase – roughly 50 to 150 employees. These were hands-on founders who had built a successful business and suddenly found themselves at the edge of chaos: approaching the 100-employee mark and feeling the wheels start to wobble. They were drowning in daily operations and needed to evolve from doer to true CEO. That’s where my experience scaling two tech firms to £30M+ came in handy.

So we made a strategic decision: Monkhouse & Company now works exclusively with founder-led companies on the journey from ~50 up to 250 employees. I zeroed in on founder-CEOs approaching the 100-employee threshold – those about to undergo the painful but necessary transition from scrappy startup to professionally managed scale-up. This is our ICP. We understand intimately the pain these founders face: being stretched too thin, losing good people, growth outrunning their systems, culture fraying at the edges. We speak their language and tackle the specific hurdles they hit at this stage.

The impact of this clarity was instant. Our messaging became laser-focused – every blog, every podcast, every workshop is designed for the “stretched-thin founder-CEO” persona. The result? The right people started reaching out. Inbound leads jumped in both quantity and quality. No more wading through irrelevant inquiries. Suddenly, the founders who called us were exactly the ones we could help the most – and they knew it too. Our conversations were immediately on the same wavelength. This magical alignment of offering and audience only happened once we got specific about who we serve and why.

And guess what – saying “no” to others hasn’t hurt us one bit. In fact, it’s freed up time and energy to double down on our chosen niche. Far from limiting our growth, this focus has accelerated it. We’re on a mission to help 200 founder-led firms scale from 50 to 250+ employees by 2034, and I firmly believe we’ll get there because we narrowed our niche.

From generalists to connected experts

Perhaps the most vivid example of niche power I’ve worked with is FX Digital, a London-based tech agency founded by Matt Duhig and Tom Smith. In their early years, they did a bit of everything digital – “two guys in a family home building small websites”, as their origin story goes. They were talented and ambitious, but like many young agencies, they hadn’t carved out a distinctive positioning. Revenue trickled in from assorted web projects, but growth was slow and uncertain. At one point, the business hit a wall – work dried up to the point where tough conversations about redundancies loomed. It was a make-or-break moment.

Instead of throwing in the towel, Matt and Tom made a bold pivot: they went all-in on a very specific niche – connected TV applications. This was around the time streaming was exploding and smart TVs, set-top boxes, and gaming consoles were opening a huge new frontier for app development. FX Digital saw an opportunity to become the UK’s go-to experts in OTT (over-the-top) streaming apps and connected TV platforms. They deliberately narrowed their focus to this one arena, aiming to develop premier Smart TV apps for major media brands.

And the business results? Night and day. In one year, FX Digital went from a skeleton crew of 10 to a team of 30, more than doubling their revenue in the process. Embracing a niche made them industry leaders in that space – and fuelled an incredible rebound from the brink. Today, FX Digital is an award-winning connected TV-first app development company, delivering projects to millions of users worldwide. They’ve grown by ANOTHER 30 people in the last six months and opened an office in Barcelona and – best of all from my perspective – Matt is CEO and Tom is COO. They’ve grown with the business, scaled their own expertise, and they haven’t had to hand their baby over to some career CEO who doesn’t have FX Digital in their DNA.

By getting specific about what they do best and who they do it for, they unlocked growth that would have been impossible as a jack-of-all-trades. Matt himself has said that focusing on a niche not only won bigger clients, but also helped attract top talent – people want to work for the experts, not the generalists. FX Digital’s story shows that sometimes the only way to survive and thrive is to narrow your focus. Niche saved their business.

Start with a customer’s pain, not your product

Why do so many entrepreneurs resist niching down or defining an Ideal Customer Profile? In my experience, it often stems from how they started the business. A lot of founders (especially in tech) begin with a cool product or a cutting-edge technology. They’re excited about what their product can do – faster, better, slicker than anything else. But they haven’t clearly identified whose painful problem it actually solves.

I see this all the time: I’ll ask a founder, “What customer pain are you really solving?” and I get a description of their software’s features or their proprietary algorithm. That’s backwards. As legendary entrepreneur Steve Blank hammered home when I interviewed him on my podcast, startups shouldn’t begin with a solution in search of a problem. Instead, get out of the building and talk to customers before you write a line of code. Find out what they actually want, what hurts, what they’ll pay to fix. Only then build a product or service to match. It sounds obvious, but in the early stages we all tend to drink our own Kool-Aid. We fall in love with our tech and assume the world will too. Reality usually says otherwise.

The companies that scale sustainably have a laser focus on a specific customer pain from day one. They can articulate in simple terms: “We help [X type of customer] who struggle with [Y problem] by providing [Z solution].” And that Y problem is not generic like “needing better software” – it’s a concrete, high-stakes pain point that their target customer absolutely must solve. Think of it this way: if you can’t fill in the blanks in the sentence above, you probably haven’t honed in enough.

Yes, early on you might experiment with a few segments or use cases – that’s fine. But you should be searching for the bulls-eye, as Steve Blank would say. As soon as you find a cluster of customers who absolutely love your product because it solves an acute pain for them, double down there. Don’t keep chasing the mirage of “more features for more markets.” Focus on making those core customers wildly successful. Understand their world deeply. If you do, not only will they buy more (and refer others), but you’ll also uncover related pains you can solve – fuel for expansion when the time is right.

A tool I often use with clients is the Value Proposition Canvas, which forces you to map your product to customer jobs, gains, and pains. When we go through this exercise, I frequently have to stop teams from trying to target five or six different “core” customers. To achieve growth, you need to narrow it down to one core customer archetype who will buy from you at maximum profit. 

The Canvas then asks: what is that person trying to do (their job-to-be-done)? What would “awesome” look like (gains)? And what’s frustrating or risky about it today (pains)? Nine times out of ten, the real breakthrough insight isn’t a new feature idea – it’s properly understanding the customer’s pain in context. That clarity can lead you to tweak your product or reposition your offering entirely. It certainly led Ontruck, one of our scale-up clients, to refine their service after realising they weren’t solving the right problem for their logistics customers. Once they realigned to the true pain, their growth got back on track.

The key point here: start with a specific customer pain and build everything around alleviating it. Not the other way around. If you find yourself struggling to gain traction, step back and ask, “Are we truly clear on whose pain we solve, and is that pain significant?” If the answer is murky, you likely need to revisit your positioning and narrow your ICP. It might feel like you’re limiting yourself, but actually you’re setting the stage to dominate a slice of the market.

Focus to flourish: Niche is not a dirty word

I hope these stories and reflections highlight a theme: focus equals power in business. Clarifying your niche and ideal customer profile is not about making your company smaller; it’s about making your impact bigger. When you tighten the aperture, you concentrate the light – and it shines brighter.

Monkhouse & Company’s own evolution taught me that lesson. Since choosing to serve only founder-CEOs in the scaling sweet spot, our growth and inbound pipeline have never been healthier. The messaging clicks because it’s speaking to someone, not everyone. We attract clients we can truly knock it out of the park for, and we repel the ones who aren’t right (which is a good thing).

FX Digital’s near-death-to-boom journey shows how committing to a niche can literally save your business. They went from almost shuttering to doubling revenue by bravely saying, “We’re going to be the best in our narrow field (connected TV apps), and we’re not going to chase anything outside it.” That focus earned them industry acclaim and a roster of dream clients. Another client we’ve worked with, UP3, underwent a focusing exercise that reinforces the point – their extreme focus on a specific offering (ServiceNow managed services for certain industries) propelled them to outgrow much larger competitors. By saying no to distractions, they had the bandwidth to deliver exceptional results in their niche, which in turn drove word-of-mouth and demand.

And if you’re an early-stage founder reading this, take it from someone who’s seen the pattern over and over: if you can’t clearly articulate the pain you solve and who you solve it for, stop and figure that out now. It might mean narrowing your product scope or even pivoting to address a more specific problem. Don’t fear that focus. Embrace it. It could be the difference between floundering and thriving.

Yes, it takes guts to niche down. It feels like closing doors. But in reality, it opens the right doors. When you target a well-defined customer with a pressing need, you create the conditions for resonance – that feeling when a prospect hears your pitch and thinks, “Finally, someone who understands exactly what I’m dealing with!” That’s gold. That’s when selling starts to feel like helping (because it is), and when your marketing starts generating “aha!” moments in your audience.

In my view, generalist founders are often stuck playing small ball, scrapping for each deal. The ones who soar have the courage to plant a flag and say: This is who we are. This is who we serve. This is the problem we exist to solve. They make their niche so integral to their identity that they become synonymous with it. And then the niche expands, often dramatically. Paradoxical? Perhaps. But it’s how growth really works in the wild.

So, if scaling up is the goal, ask yourself: Is our niche clear enough? Is our Ideal Customer Profile so specific that we know them better than they know themselves? If not, sharpen your focus. Define your niche. Articulate the real pain you solve. Position your offering as the obvious solution.

Done right, niche and positioning won’t box you in — they’ll set you free. They’ll strip out the noise, attract the right customers, and give you the clarity to scale with intent.

In business, it’s not the generalists who win — it’s the specialists. Be known for something. Own it. Build from there.

Because the alternative? It’s being forgettable. The solution? Go niche or go home.

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Written by business coach and leadership coaching expert Dominic Monkhouse. Contact him to schedule a call here. You can order your free copy of his book, Mind Your F**king Business here.