Longtime HNer on a throwaway account. I've just started work on a startup making a web app for a particular type of business. (Sorry about the intentional vagueness.) There's something like 5000 businesses of this type in the U.S. With subscription billing, if the average customer is paying $25/month, I'm looking at a
total market size of $1.5 million/year. Granted, maybe there are additional apps I could build in the same domain, and other unknown sources of revenue, but I'm starting to worry about potential for growth.
Am I overthinking this? Have any of you launched companies into markets of similar (or smaller) apparent size? What problems am I going to run into, and what's the best way around them?
They offer a large number of even smaller niche services; you're sort of expected to make your own bundle of subscriptions that apply to you. But as you may guess by their name, their flagship publication is the quarterly one. Yeah, their big moneymaker is published just four times a year.
You know how much CQ charges for their services? Hint: this is their subscription page: http://corporate.cqrollcall.com/wmspage.cfm?parm1=79 Yes, that's like 30 different phone numbers you're looking at. No, they don't let you subscribe online.
When that happens, you're either dealing with someone living in the stone age or a hyper-niche publication that everybody who's anybody in the world of Federal politics subscribes to, despite its absurd pricetag (e.g., four figures for a one-year sub to just Quarterly). That subscription isn't a status symbol, it's a necessity. Their livelihood depends on the information Congressional Quarterly provides.
It doesn't matter how small your market is. If your product is only of value to a slight fraction of the population, then make it so good they can't live without it. And charge out the ass for it.