You might be right but who said this would be the only motor they will make?
If I was starting a motor company, the first motor I would market (besides plane motors) would be offroad .21 motors. They are far easier to get right then onroad motors where shear horsepower is everything but people still expect them to last. I'd get my feet wet with offroad motors and take a LOT of time developing before I sold the first onroad motor.
Just look at GRP. They came out with everything at once. Lots of people seem to love the offroad motors but most onroad racers wouldn't run one if you gave it to them. They should have done a little more homework first.