Chihuahuaball

There was an interesting post on The Rational Entrepreneur a few days ago on the The Law of Small Numbers--"our intuition that we can pick a small sample and confidently extrapolate from it." I love the example, Rolf Nelson - the blogger behind The Rational Entrepreneur--gives:

You and your best friend like paintball and chihuahuas, yet the paintball/chihuahua crossover demographic is completely ignored by big business. Surely you two can't be the only ones who would enjoy combining the experiences; you can extrapolate that there must be many others who would pay for the ability to roam about in camo as you deploy an army of small dogs to hunt down and sink their teeth into the enemy's padded ankles. So you open the world's first Chihuahuaball franchise, and are puzzled when the throngs fail to materialize.

 I can't count the number of times that I've seen people fall into this trap.  It's easy to believe that you can some how turn your niche passion into a business.

I think it's important, before you decide to turn your weird little fetish, into a business to understand the economics of the business your proposing. Once you understand the ecnomics, you need to figure out if the market is big enough to allow you to make a profit.

Taking Nelson's example, you should figure out how many people will need to play Chihauhuaball on a montly basis in order for you to turn a reasonable profit?  Once you know how many people, then you need to figure out if you can realistic expect that many people to show up.