How To Create A Category As A Small “e” Entrepreneur: 7 Legendary Ways To Niche Down

Life is good when you have no competition.

Pirates, are you playing Christmas music aboard your pirate ship yet? Rockin’ out to your favorite Hanukkah hymns? Are you and your fellow swashbucklers getting in the holid-ARRRRR! spirit? As we enter the holiday season, we want to remind you that the single greatest gift you can give someone is the gift of knowledge. One reframe, one “new way” of seeing the world, and that person’s life may change forever. So if Category Pirates has had a positive impact on the way you see the world of business, entrepreneurship, marketing, investing, and even life as a whole, then we encourage you to pay it forward and give that same gift to someone else in your life.

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Dear Friend, Subscriber, and Category Pirate,

One of the most common questions we get asked is, “How do I create a category if I’m not a heavily funded startup or some massively successful company? How can someone like me create a category of my own?”

We love this question because it reveals maybe the single greatest benefit of category design:

Anyone can do it, at any stage of their life.

Category creation and category design is not a strategy reserved for multibillion-dollar companies or high-flying startups. And while money is often helpful, it is not a requirement (and in some cases can be the difference maker, as constraints are a forcing function for creativity). In fact, some of our favorite category designers are solopreneurs, small business owners, and consultants who have niched down, leveled up, and found a way to get themselves out of “the comparison game” and into a category of one. As a result, they have no (or little) competition. 

Which means they’re in demand and they set the price.

However, the secret to “not having competition” is not to pick a niche that simply has no competition.

This is an oversimplification of the problem.

For one, if you are choosing to *look* for blue ocean, simply for the sake of blue ocean, then you are a mercenary—not a missionary. You just want your little slice of the existing pie. (And if this is you, then we encourage you to read our mini-book, No Ocean Strategy, and start from a place of, “There is no ocean—now what?”) And second, if you are trying to fix your competition problem by searching for a niche with no competition, what you probably won’t find is opportunity. Instead, you’ll likely find a dead, deserted category. There’s a reason no competition is there anymore: everyone left (including the customers)!

But how you create a category for yourself as a small “e” entrepreneur is not just about niching down and getting more specific about your offering. 

It’s about having a Point Of View.

  • Why are you niching down?

  • What problem are you determined to solve in the world?

  • Who do you want to help?

  • Who do you not want to help?

  • Why is it so important to you? And why is it so important to the people you want to help?

  • What will life be like on the other side (tell us!)?

Because without a POV, your niche is nothing but a small straw trying to suck the juice out of someone else’s coconut.

But with a POV, you can grow your own coconut tree.

We affectionately describe small “e” entrepreneurs as business owners who do not take the path of raising huge amounts of capital from venture firms, and instead choose to build small but mighty (and sometimes, insanely profitable) businesses. Small “e” entrepreneurs are the lifeblood of the US. They drive 44% of the economy and create two-thirds of the net new jobs. In many cases, they are family businesses. We love these entrepreneurs, and so do 72% of Americans who prioritize them over getting “the best deal.” They bring character to communities, sponsor little league teams, and are highly creative and innovative in ways big companies often are not. 48% of Americans work in a small business, and 18% work in companies with fewer than 20 people. Further 20% of small businesses are owned by women. 

Small “e” entrepreneurs matter. 

The Story of Daversa Partners

Let us give you an example.

Headhunters are all the same right? Headhunters are undifferentiated right?  The primary way they succeed is by being good at what they do and building relationships, right? (Aka: “They all sell the same product.”)

Maybe not.

In the very early 2000s, a pirate by the name of Paul Daversa, founder of Daversa Partners (at the time named Resource Systems Group), asked Pirate Christopher if he’d be open to an afternoon sail to talk. He had a problem, and his problem was that RSG was an undifferentiated headhunting firm. Paul, the founder, explained how he and his team were great at sales, great at recruiting, but it was a lot of hand-to-hand combat. They had to work hard to convince each person individually, and even though it worked, the company was stuck in a comparison game (The “Better” Trap)—constantly competing against all the other headhunting firms out there.

So Pirate Christopher asked him, “OK, so what makes you different?” “What problem do you solve?”

To which Pirate Paul replied, “Most headhunters deal with people who are looking for a new job. The problem is, if you’re looking for a serious executive who can create a different future for your company, the likelihood that person is looking for a new job is almost zero. Because they are already employed at a great company and highly compensated. In addition, most recruiters shy away from challenging their very best recruits by creating a value proposition that takes the candidate journey from “not realistic” to “what’s possible.” So what we do is recruit highly valuable executives who aren’t looking for new jobs, and more importantly, show these highly valuable executives what else is possible for them.”

Pirate Christopher pointed out to Pirate Paul that he’d just said the answer. 

RSG already had a unique and differentiated service, solving a different problem—all Pirate Paul needed to do was Frame, Name, and Claim it. “You don’t recruit executives,” said Pirate Christopher. “You recruit unrecruitable, material impact executives.” (Specificity + Languaging.) And that’s not just a niche down, that’s a powerful new and different Point Of View of the industry. 

He then encouraged Pirate Paul and his team to niche down even further and focus primarily on recruiting executives in tech—narrowing their “different” even more.

20 years later, Paul Daversa called Pirate Christopher out of the blue.

He wanted to say Thank You. 

Because the category design and POV of “unrecruitable, material impact executives” had changed his life and his firm. When the company was called Resource Systems Group and had no category design, they had 10 people and were struggling financially. Pirate Christopher told Pirate Paul that “RSG” sounded like the name of a dusty computer repair company going out of business. So they changed their name and adopted a new POV grounded in new Languaging that more accurately described Pirate Paul’s personal super power: recruiting unrecruitable, material impact executives.

Fast forward 20 years. Today Daversa Partners has over 200 people. They are international and operate in eight major cities. Daversa has become the go-to independent firm that tech VCs and executives turn to for “material impact executives.” And as Pirate Paul is proud to point out, he has “a lot of millionaire partners.” And a huge reason for their success is the fact that, even long before COVID and “The Great Resignation,” there has essentially been zero unemployment for “material impact executives” in the tech industry. Virtually anyone who is anyone has been “unrecruitable” for a long time. And so, as the category began to change, and “the thing” they were known for became the thing every headhunting firm needed to figure out how to do, this gave them a tremendous competitive advantage.

Because if you can’t recruit the unrecruitable today, you can’t do any recruiting.

Daversa prosecuted the Magic Triangle: Product Design, Company Design, and Category Design. And they invested massively in building their own data flywheel. “Our team of data analysts strategically focuses on cultivating the top 10% of future material impact executives that we believe will drive unparalleled results for innovative technology companies,” says Paul Daversa. And to this day, this is the way Daversa Partners explains who they are and what they do. “We recruit unrecruitable material impact executives.” They've sung this song so loud and for so long, material impact executive even became a term in the industry. 

Daversa Partners is seen as “the original.”

They’re untouchable.

How To Niche Down

“Niche down” opportunities combined with a Framed, Named, and Claimed unique & differentiated POV is the key to getting out of The “Better” Trap and enjoying a life where you have no competition.

You’re in a category of one.

In this “mini-book,” we are going to walk you through the 7 ways small “e” entrepreneurs (solopreneurs, small business owners, consultants, advisors, freelancers, etc.) can become known for a niche they own

• WHAT do you do… that you are uniquely known for?

• WHO do you do it for… who are surprisingly willing to pay large premiums?

• WHEN do you do it… that sits at the peak intersection of Important and Urgent?

• WHERE do you do it… that if money were no object, everyone would want it?

• WHY do you do it… that is so in sync with the Superconsumer, word of mouth spreads like wildfire?

• What OUTCOME do you unlock… that is 100x more valuable than the price you charge?

• How much and “how” does it COST… that is both a value & a premium, and the ‘way you pay’ is a benefit in itself all at the same time?

Each of these are areas of opportunity for you to execute a No Ocean Strategy, meaning you CREATE something in the world that previously did not exist. And the more of these “niche down” opportunities you combine together, the more different you are and the more difficult it becomes for someone else to “do what you do.”

Let’s begin.

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