Starting a Business in a Highly Stigmatized Industry: Insights from Eligo Energy / Starting a Business / Last Modified: February 22, 2017

In the past, starting a business in a stigmatized industry was not a popular choice. Today, there are many ways to push past the negativity.

Inc. Magazine recently named the stigmatized energy industry as the fastest growing industry in the country.

While it is not surprising to see newly emerging companies attempting to get a share of the energy market, success in a sector receiving poor publicity is more difficult to attain than in other rosier market segments.

Startup Eligo Energy taught me several valuable lessons on what it takes to be successful despite the negative aura that surrounds the energy supply industry.

These takeaways may be applied to any entrepreneur considering starting a technology-driven business.

Related Article: Renewable Resources: The Impact of Green Energy on the Economy

Find Your Space and Solve a Problem

First and most important – determine the sector of your future endeavor. Choosing may be as simple as finding a problem that affects you directly and figuring out how to solve it. Building a product or a service that you can actually utilize will give you the motivation to complete it. Uber’s evolution is the perfect example of this.

The two founders wanted an easier way to use a limo timeshare service. They wound up solving the problem of how to find a ride at the right place and the right time. Years later, since its founding, the ride-sharing app has become a global service.

Don’t just limit yourself to solving the problems of young software engineers living in Silicon Valley or New York. While there are many opportunities in those markets still untapped, competition is also fierce. If you only consider solving a problem you yourself have, you may be missing out on other big markets. There are plenty of very smart and sophisticated engineers, designers, and aspiring entrepreneurs, and only so many social networks, dating apps, food delivery and laundry on demand companies that the world needs.

A different approach is to understand under-served markets and markets where competition tends to be unsophisticated. Because the smartest and most sophisticated entrepreneurs, engineers and business people are drawn to industries that are presently in vogue, you may faceless technological competition in industries typically dominated by “mom and pop” type of small businesses.

Thus, in my present endeavor, I specifically targeted such an industry, with the goal of finding an opportunity to “disrupt” the existing way of conducting business by bringing our specific skills to the industry. Of course, many of these less glamorous segments of the market are overlooked precisely due to their lack of glamor or even a bad stigma associated with the market segment.

Working in a Stigmatized Industry

Starting a business is no easy feat; starting one in an industry that has been highly stigmatized and surrounded by negative press adds an extra hurdle for startups. For example, in my newly chosen industry, numerous suits have been brought against Retail Energy Suppliers (RES) for a variety of reasons, including violations of Telephone Consumer Protection Act (TCPA) provisions and various State consumer protection regulations.

These bad apples bring stigma to the industry and make it more difficult – but not impossible – for law-abiding companies to succeed. In our case, following the advice provided here, helped us succeed despite, and perhaps, because of the bad press associated with many of our competitors.

Related Article: Best and Worst Places to Start a Business in the U.S.

Identify Competitive Advantages

Once you have identified the problem that you are going to solve, self-reflect and identify your competitive advantages and strengths compared to your chosen market segment. Self-reflection may help you focus your beliefs, passions, and intentions, thereby helping shape your ideal company. Meanwhile, identifying your competitive advantages will become the foundation upon which you eventually build your enterprise.

Passion, perseverance, and a positive attitude set successful entrepreneurs apart. One of your competitive advantages may be based on your own previous experience as well as in the people you previously worked within other endeavors. You need to cultivate these attributes in yourself but also surround yourself with like-minded professionals.

Initially, those will likely come from your previous endeavors. Often, working in the field before you take on the challenge of opening a business may be beneficial. Even working under a mentor in a completely different field will give an opportunity to learn from your predecessor’s mistakes.


Make sure that you learn empathy. Today’s world is one of sophisticated consumers with multiple teaching and public-relations tools at their disposal. Easily accessible ratings and reviews are on the rise. You must know what your customers want and be willing to cater to it. And this one may not be as obvious – know who your customers are.

Often, there are less obvious customers, especially in a service industry. Take calculated risks. In the beginning, take calculated risks. You rarely hear success stories from someone that invested everything at once, or, on the flip side, someone who was afraid to invest anything at all. Taking calculated risks provides a controlled environment with room for error and a built-in ability to learn from mistakes.

Related Article: Old Dog, New Tricks: What's the Best Age to Start a Business?


When you start your own business, especially in a stigmatized industry, continue to ask yourself questions and adapt depending on the answers:

  • How can we use the expertise and advantages that we have to revolutionize this industry?
  • Can we make better use of data than our competitors?
  • Are there effective ways of communicating to the customers that existing market players are not utilizing?
  • Can we be more agile and better at applying technology?

Answering these questions and delivering quality service will greatly contribute to the continued success of your new endeavor.

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