In present work we investigate the possibility of running a high gain FEL on a storage ring using a longitudinally focusing insertion to compress bunches passing an undulator. If integrated into a storage ring similar to PETRA III such device could potentially produce continuous ∼1ps pulses of photons in the nm range with peak pulse powers of tens of GW. Even without operating in FEL saturation mode the longitudinal focusing can provide means to increase the brightness and shorten the photon pulse length.