While in a different sector;
I've had a little experience with small businesses. And seeing them building into power houses (growing from a base of hundreds ..to millions of clients/end users).
imho, many do seem to over stretch their business way too early. Mostly through hubris and wide eyed entrepreneurism (this has even caused establish companies to fall). The trick, does seem to be; 'build a rock solid base'.
A base you could live on if need be ..without the need to build it up more.
Once that is done, the sky is the limit! ..just work each rung of the ladder one at a time
imho - The 'little guy' could still run a small business and focus on top tier genetics/phenos and growing, creating a good niche market.
Top quality, selection (and continually looking for new ones to cycle in once in a while). Plus, a strong focus on customer needs.
Really, you just need a specific number of clients, a quality product, service and business plan and pricing (probably, based on number of clients).
If you can build up a product range like this and 'cycle' them (to keep interest, fun and curiosity high). Plus, maybe adding a few of your own 'bells and whistles' (specials etc). Then, you should be able to create a nice little cottage industry
Once you have that little cottage industry ticking over nicely. It can act as a fallback/safety net, if you decide to attempt an expansion in a particular business direction.
P.s:
I'm available for hiring ..from time to time