Three enterprise prospects wanted to pay $100K+ for custom features. Tempting revenue, but would derail our SMB product roadmap.
THE DECISION
Turned down enterprise deals, stayed focused on SMB.
Enterprise features (SSO, advanced permissions, custom reporting) would take 6+ months
Our team of 8 couldn't support enterprise and SMB simultaneously
Enterprise deals would create precedent for more customization requests
SMB market was 100x larger long-term opportunity
Product focus
Faster SMB iteration
Clearer positioning
No enterprise support burden
$300K potential revenue
Credibility of 'enterprise customers'
Short-term cash flow
Stayed SMB-focused, reached 5,000 paying customers at $49/mo. One year later, built enterprise tier on our terms (standardized, not custom). Revenue grew faster via SMB scale than enterprise customization.
Early revenue isn't always good revenue. Enterprise customization can kill startups. Choose your market and commit.