Start Small and Monopolize
If monopoly is the goal, the path is counterintuitive: start with a market so small most people dismiss it. A small market is easy to dominate. A big market means competition from day one and a fight over scraps.
PayPal did not target 'payments.' It targeted eBay power sellers, roughly 20,000 people who traded professionally and desperately needed a better way to get paid. Within three months PayPal reached a quarter of them. Facebook started with a few thousand Harvard students and hit majority penetration in ten days. Tiny beginnings, total dominance.
Then expand into adjacent markets from that base. Amazon went books first, then media, then everything. The sequencing matters: dominate the niche, use it as a beachhead, grow concentrically. Founders who chase a giant market first (Thiel's era was littered with online pet stores fighting over the same customers) get ground down before they build anything durable.
“Always err on the side of starting too small. The reason is simple: it is easier to dominate a small market than a large one.”
Key idea
The perfect target market is a small group of particular people concentrated together and served by few or no competitors. Dominate it, then expand.