Definitely a lot of startups target high end, but they end up competing in high end by being cheaper than the other high end alternatives. High end is just a better market to attack first since high end users are more liberal with their spending, and more likely to pay a premium for something new.

Uber is an example of something that started in the high end (black cars only).

Airbnb, Instapainting.com (disclaimer: my company) are examples of companies that broke into mid-market products by using technology to reduce costs and compete with significantly lower pricing.