In May, Good Eggs made quite the accomplishment.

The company raised $50 million in Series C funding from investors such as Benchmark Capital, Index Ventures, and others.

This is in stark contrast to the issues Good Eggs faced in recent years, as it nearly went out of business. In 2015, the brand laid off a significant portion of its workforce and ceased operations in three of its four markets. It had expanded too fast, and was at the brink of bankruptcy.

Good Eggs’ next challenge will be competing against the one-two punch of Amazon and Whole Foods, in addition to players like Instacart and Thrive Market. While a daunting task, it brings to light the fact that the incumbent players should not be a deterrent to entering a seemingly crowded market.

A Single Dominant Player Cannot Cover All Niches

For Good Eggs, competing with Amazon might look like an insurmountable barrier—but it doesn’t have to be. Rather, the brand ought to take an opportunistic perspective in that the behemoth’s incursion into grocery will further shift consumer behavior online.

This is really good for Good Eggs’ business.

Amazon offers unparalleled convenience and selection, but the reality is that it cannot be everything to everyone. As I’ve mentioned before, consumers view the brands they buy as extensions of themselves. They want the products they purchase to reflect who they are as individuals.

This is a niche where Amazon actually has a disadvantage.

Conversely, when you browse Good Eggs’ selection, each item is accompanied by a description of the individual or farmer from whom it was sourced. There’s real authenticity and personalization that appeals to consumers who are hyper-passionate and emotional about their food.

Purchasing organic sugar snap peas from Capay Valley Farm, avocados from Stepladder Ranch, or cocoa nib chocolate shortbread from Kika’s Treats are experiences that Amazon and Whole Foods simply cannot provide.

Since its struggles, the company has sought to build strong unit economics by focusing on a customer base in a single metro area and operating out of a single warehouse. The result is an average Good Eggs order north of $100, an average customer who orders multiple times a week, and a path toward projected EBITDA margins of 10%.

By honing in on a specific niche, Good Eggs can succeed. The company can thrive by catering to a consumer base that has no desire to get their food from the world’s largest e-tailer.

The Incumbent Player Isn’t Necessarily the Best

The beauty of the Birchbox model is that it disrupted the cosmetics industry by letting women who aren’t necessarily obsessed with beauty products try them at home. However, Birchbox has stumbled.

The company has been criticized for not properly leveraging its subscriber profile data and being off-base with the samples it distributes. Not only have some of the company’s products proven a mismatch for certain profiles, but many subscribers have received the same products month after month, resulting in fewer opportunities for discovery.

Customers are tired of getting hair products unfit for their hair, along with the same old black eyeliner.

Birchbox has since suspended its plans to open new brick-and-mortar stores, experienced challenges in raising capital, made multiple rounds of layoffs, and faced a California class-action lawsuit.

This is where Ipsy comes in. Founded by YouTube star Michelle Phan, Ipsy’s growth model is to drive subscriptions through Phan’s social media influence and the platforms of associated vloggers.

Not only that, but Ipsy does not buy its samples. Instead, cosmetic companies provide them for free as marketing in exchange for the data and feedback Ipsy gathers from its 3 million subscribers. At the same price point as Birchbox, Ipsy consumers receive five items each month—and the samples are generally much larger.

The brand has also made an effort to incorporate customer preferences into its offering. Ipsy’s network of over 8,000 demonstration creators features a following of more than 600 million, allowing the brand to gather hundreds of data points on each member.

The result is unparalleled personalization.

In contrast to the issues plaguing Birchbox, Ipsy has been profitable for over five years—and the company has spent almost no capital on advertising. Instead, it has offered mentoring and studio space to vloggers and other influencers.

Instead of cowering at Birchbox’s incumbent market presence, Ipsy leveraged a great opportunity.

Target a Different Part of the Value Chain

Zesty encountered a crowded landscape when it entered the meal delivery sector. It faced well-funded incumbents like Blue Apron and Plated. Meanwhile, Sprig, SpoonRocket, and Maple were all seen as promising competitors with unique value propositions.

In an adjacent space, Instacart, DoorDash, and Postmates boasted competing offerings.

None of this deterred Zesty. Because Zesty targeted a different part of the value chain.

Rather than aiming at the end consumers and touting itself as yet another meal delivery service, the company aimed higher. Zesty positioned itself as a health-minded, technology-enabled business catering service that promised to deliver “Google cafeteria-grade” meals to SMEs that didn’t have their own commercial kitchens.

With less funding than comparable startups, Zesty managed to build partnerships with roughly 150 restaurants in San Francisco. Some of Zesty’s customers included Snap, Splunk, and TechCrunch—these companies were eager to offer their team members meal-related perks, but simply lacked the infrastructure of Google or LinkedIn.

From the very beginning, Zesty paid close attention to customers’ individual needs. The company worked with registered dieticians and local chefs to curate a company-specific menu based on client preferences, dietary restrictions, food allergies, and other criteria. Zesty recipes tend to be low in sugar, oils, and other ingredients that can cause workers to feel sluggish instead of energized post-meal.

At the root of its strategy (and success) is data. Zesty uses data volumes and proprietary algorithms to learn and constantly refine how clients are eating, to better plan its menus, and to predict and optimize logistics. On the supply side, Zesty handles the delivery, serving, and cleanup of its prepared foods, allowing chefs and kitchen staff to focus on their own operations.

Constant improvement and its bottom line did not go unnoticed. Zesty focused on better predicting how much food is needed—on a per-order basis—to keep clients happy while minimizing the food waste that hinders profitability.

Fast-forward to 2018: Zesty was acquired in April by Square as a key component of its Caviar strategy. Kitchit, however, was already dead by Q2’16. SpoonRocket was acquired after it ran out of capital. Maple ceased its operation and was acquired by Deliveroo. Sprig shut down in May 2017. In an ill-timed exit, Blue Apron has struggled to convince public markets of its viability in a competitive market, which now includes a Whole Foods-armored Amazon.

Zesty was successful because it targeted an open area of the market instead of diving into an oversaturated space.

It Never Hurts to Take a New Angle

Before Equinox, chains like 24 Hour Fitness, Crunch Fitness, Planet Fitness, and others were ubiquitous. Today four successful NYC fitness clubs have turned into national—and now global—lifestyle brands.  Equinox, PURE Yoga, Blink Fitness, and SoulCycle boast more than 135 locations in every major U.S. city, in addition to London, Toronto, and Vancouver. There is even an Equinox Hotels brand.

How did a late arrival do so well, so quickly?

In contrast to the incumbent gym chains, Equinox succeeded not by leading with its offering, but by leading with its brand. The company started with a clear and differentiated point of view, vision, and mission.

Its vision involved empowering people to maximize their potential. This is something that spoke to high-performing individuals—being associated with the brand satisfied an innate desire to live their best lives.

Equinox also thrived by taking a very granular, leave-no-stone-unturned approach. Unlike the broad-brush strategy of big box gyms, Equinox fueled the explosion of boutique fitness with the acquisition of SoulCycle, scaling it into the leading boutique fitness offering across the U.S. and Canada. Simultaneously, it launched and segmented Blink Fitness to answer demand from a different corner of the market for an affordable, quality fitness offering.

Its next big opportunity will be the launch of Equinox Hotels, which aims to redefine the concept of luxury travel by highlighting the importance of a holistic, healthy lifestyle.

The company is achieving this by way of successful brand advertising campaigns and unique club design elements. Equinox strives to create and curate bespoke experiences for its customers, and has worked with high-profile fashion photographers such as Steve Klein, Ellen von Unwerth, and Sante d’Orazio to help convey its unique brand to global audiences. Equinox also works with international designers such as Yabu Pushelberg, David Rockwell, AvroKo, and Meyer Davis to ensure its clubs truly inspire with one-of-a-kind member environments.

Lastly, with its recent investment into uber-authentic Rumble Boxing, Equinox stands to further credentialize itself and tag on to the next high-growth fitness sub-segment. It would come as little surprise that Rumble rises above incumbents such as Everybody Fights and Box Union, and celebrities, models, and everyday athletes are flocking to its locations. The result is a virtuous cycle: better brand, more informal endorsement, and even more growth.

In summary, there was already a plethora of gym options before the arrival of Equinox. However, Equinox entered a crowded market and—by leveraging its uniqueness—completely redefined it.