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Do I Need Domain Expertise To Startup?

known or unknown for starting up

A startup doesn’t operate in isolation; it operates in an environment called the industry. As much as the founder is skilled in a particular function, the understanding of the industry plays a massive and crucial role in driving the business forward.

Whether one should start in an industry where one possesses domain expertise is a question that attracts both points of view. You will find some people and especially investors say that one should stick to what one knows best and then there are others who have created successful businesses without having a relevant industry background.

As an entrepreneur, one is supposed to be creative. The basic concepts of idea generation are based on the premises of observing people’s problems, spotting opportunities, filling in the gaps and improvisation. However, when one comes up with an innovative idea that by the traditional sense doesn’t belong to the industry one belongs to, does the execution get impacted in that case?

Well, from my own experience, I would say it does…

Prior to starting, I actively conducted due-diligence on two other ideas. My first idea was to create Moral Intelligence Kits for 3-5 year old toddlers.

I chose that idea because ethics and philosophy excites me and I wanted to do something at the root level (kids) when it’s easy to imbibe virtue in the kids.

My second idea was to have home owners get affordable interior design plans online from interior designers.

I abandoned both ideas after having gone a long way into the due diligence because I had to rely heavily on a domain expert; Due to lack of domain knowledge, I found it extremely difficult to define processes or activities (for kids) without a full time domain expert by my side. It slowed things down; while I could have got someone on board, I wasn’t satisfied with the domain experts I was bumping into. Since starting up mattered more to me, I thought I might as well start where I had more knowledge.

Now, don’t get me wrong here that it’s impossible to start in an industry where you don’t have sufficient knowledge. There are several ways to work around the issue and if I had persisted enough or not drawn into an industry where I was more knowledgeable, maybe things would have worked out. So, if you know that you have a great idea but lack industry knowledge, you must do the following:

-          Become a seeker of knowledge: I can’t say enough as to how crucial this is to you if your idea doesn’t belong to your background industry. Not only do you need to research the Ins/Outs of the industry but you also need to talk with loads and loads of different people in that industry. Research the internet, dig up industry reports, trends, talk to influential people in that industry to understand it all.

-          Fast learner: You not only need to focus on developing your business idea but you really need to accelerate your learning of that industry. While I was researching the activity idea, I visited several kids stores to see what all was happening in that space and what sort of games were available. I spoke for a long time with the store manager about my idea and to assess his response if they were doing something already.

-          Engage a domain expert: You have to do this at some point or the other. There will be no exception to this rule because domain knowledge is power. The kind of engagement may differ of course; you may want someone as a cofounder or as an advisor on board or a part-time consultant. A word of caution while engaging a domain expert – Since you don’t have direct knowledge in that industry, the domain expert that you engage (especially long term) better be good. Talk to several people before you really make up your mind to engage with someone on a commercial basis. The engagement should start small by which I mean instead of offering equity upfront, create smaller milestones using the retainer model or other mutually beneficial arrangement.

Having said that, if you are starting up for the first time and if you have several ideas to choose from, include domain expertise as an important selection criteria. Starting up for the first time by itself is a rocky road full of uncertainties, one is learning by doing. In such situations, if you possess the domain knowledge yourself, you will just feel more confident and a bit more comfortable throughout the process.  

So, what are your experiences? Are you doing something in an unfamiliar industry? Regret starting in an unfamiliar industry? Do share your thoughts below.

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NIDHI KAPOOR - Nidhi is the co-founder of She holds an MBA in Innovation & Entrepreneurship from Imperial College, London. Prior to starting, she worked with 2 reputable startups in London. One of the startups was as young as a year old where she was the first hire while another was almost 5 years old. This has been an enriching experience for her in understanding the dynamics and needs of a startup across a broad spectrum.

Nidhi can be contacted at

You can read past articles by Nidhi Kapoor here: Link1 and Link2.


Article Name
Do I Need Domain Expertise To Startup?
A startup needs to operate within an industry. How important is domain expertise when an entrepreneur wants to startup? Does the execution get impacted?