I think the problem with startups isn't that they target a few hundred people. They probably target a couple hundred thousand people. The problem is that it is invariably THE SAME people... and that the people they target do not pay money for the things that startups sell. To the extent that startups sell anything. Because they realize they can't. Because their target does not pay money for software or services. (They'll pay for some technology -- iPods, for example. But they won't buy what startups are selling. Sorry. They also won't buy anything from anyone who runs ads on the Internet, which is why "We get a billion eyeballs and then we MONETIZE!" is going to be a tough row to hoe the next few years.)

I have a teeny tiny software business. 95% of my customers are female. The average age is, making an estimate, north of 35. I deal with a lot of @aol and @roadrunner email addresses. Despite the abject disbelief I get when I tell my software writing buddies the story, it really is possible to sell software to folks who do not know what RSS is and do not care that their websites validate.

So why do I feel like I'm one of the only guys trying to do it?