>This is why starting upmarket and working down (Apple) works better than starting downmarket and trying to work up.
I don't think we can go that far.
Apple didn't start upmarket, first of all. Their original market was technical consumers. Jobs's obsession with design and beauty in combination with the Mac's decline in favor of more "business-oriented" IBM PCs, which were much uglier, eventually made Apple the de-facto brand of artists and designers, which led to it becoming the brand of those who wanted to showcase their creativity.
Apple products became fashion statements that said "I'm creative and unique". That's what really drove Apple into the luxury segment. It seemed to be more accidental than anything else.
Second, going after the big fish always sounds nice, but it's hard to do it successfully. Enterprise sales cycles take a long time, months or sometimes years. The features that big customers want are usually giant PITAs that have to integrate with 6 wildly divergent legacy systems. Enterprises want enterprisey support and they consider questions like "How likely is it that this product is going to be around in 5 years?" as part of the sales cycle (and until your company is at least 5 years old, it's hard to answer that).
For high-end consumers, in most cases, luxury brands have to be aged and respected before they build up the panache needed to drive acquisition. The brand has to be carefully controlled and messaged. Aggressive marketing can sometimes speed up the aging process.
If you're targeting mom-and-pops or normal consumers, there is a much bigger pool of consumers to draw from, and they have much lower barriers to entry. Find a segment to hook, inspire loyalty, serve them well, and then see about moving on to enterprise, hopefully targeting enterprises that your long-term customers work for and can convince to buy MyThing Enterprise Edition.
If you're starting with $5M of cash, going after the big fish in the pond may work fine. If you're trying to bootstrap or trying to find a way to survive after some pittance of seed funding runs out, it's usually a different story.
I don't think we can go that far.
Apple didn't start upmarket, first of all. Their original market was technical consumers. Jobs's obsession with design and beauty in combination with the Mac's decline in favor of more "business-oriented" IBM PCs, which were much uglier, eventually made Apple the de-facto brand of artists and designers, which led to it becoming the brand of those who wanted to showcase their creativity.
Apple products became fashion statements that said "I'm creative and unique". That's what really drove Apple into the luxury segment. It seemed to be more accidental than anything else.
Second, going after the big fish always sounds nice, but it's hard to do it successfully. Enterprise sales cycles take a long time, months or sometimes years. The features that big customers want are usually giant PITAs that have to integrate with 6 wildly divergent legacy systems. Enterprises want enterprisey support and they consider questions like "How likely is it that this product is going to be around in 5 years?" as part of the sales cycle (and until your company is at least 5 years old, it's hard to answer that).
For high-end consumers, in most cases, luxury brands have to be aged and respected before they build up the panache needed to drive acquisition. The brand has to be carefully controlled and messaged. Aggressive marketing can sometimes speed up the aging process.
If you're targeting mom-and-pops or normal consumers, there is a much bigger pool of consumers to draw from, and they have much lower barriers to entry. Find a segment to hook, inspire loyalty, serve them well, and then see about moving on to enterprise, hopefully targeting enterprises that your long-term customers work for and can convince to buy MyThing Enterprise Edition.
If you're starting with $5M of cash, going after the big fish in the pond may work fine. If you're trying to bootstrap or trying to find a way to survive after some pittance of seed funding runs out, it's usually a different story.