But the essence of the comment is spot on, these apparently barren landscapes of competitors often have a cause, and so just finding such a market is only the start of analyzing WHY it seems to be so noncompetitive.
[1] Two economists are walking down the street and one sees a $20 bill on the ground and picks it up. The other asks, "Why did you pick that up? It's clearly counterfeit, if it were a real $20 bill someone else would have already picked it up."
I've found there are a lot of secondary markets that get overlooked by VC. Typically, these markets have (1) a lower ceiling so they're overlooked by VC's needing an outside return. They can still be massively profitable for a bootstrapped or lean company. (2) Require deep knowledge of two non-overlapping subjects.
Sometimes I hear, pejoratively, a "lifestyle" business.
Yes there might _have_ been a reason for a the market to be competitive, but something might have changed in the past few years that has removed or minimized that reason.
These are the marketing that are ripe for competition.
But then on researching it deeper I discovered the basic problem with the market is that doctors won’t pay enough on a monthly basis for a high-touch sales process and they still mostly insist on one or more personal visits before buying the product. So, you basically lose money on every customer for the first year or two, meaning it is really hard to build a sustainable business. I got access to the financials of two of the existing players, and they were not good. They did the minimum investment into the product they could get away with because the market wouldn’t allow for more than that.
I've been researching medical market a lot. There are many reasons why appointment and practice management software isn't a great business. But the number one reason is that it doesn't create a great value for doctors. Patients will still come and use the same doctor, insurance companies will still pay them the same, it won't bring new patients, it will not make it easier for doctor to manage his practice since he still has to have a nurse which does this.
On another hand, it makes it easy for their patients to go somewhere else since EHR need to be completely available to patient. This is an unnecessary risk.
So if one wants to make an appointment/booking software, would have to look for things that would bring new customers. Helping with discovering places.
People bash bad UX and buggy software all the time, like "those developers are sooo bad".
What they mostly don't realize that software is only as good as much someone is willing to pay for.
Sometimes it is niche until technology catches up with a need.
Sometimes it is niche until an un-suckful product is actually offered.
Sometimes it is niche until a sudden shift in the entire economy or market.
The shift from horseshoe-clad transportation to a new thing was rapid only after about 20 years of "niche" gas-powered automotive vehicles.
My first thought was, someone who makes a hard-to-find part for a low volume vehicle. Take, for instance, the original Tesla Roadster. It sold about 2500 units. Maybe they have a problem that happens in 10% of units. You have a maximum of 250 customers, assuming none are scrapped and you provide the only potential solution.
These are the sorts of situations in which you’ll find very little competition. For a lot of people with niche interests there’s always “that one dude on the forums” who is the only person with the solution.
The same kind of situations arise often in enterprise too, and it’s the kind of things that internal teams or contractors might one-off. But, if you make an off-the-shelf product for it, you’ll be the only game in town!
You can throw as much business intelligence and automation to, let's say, an Ice Cream truck. It will still be an Ice Cream truck. Nobody is becoming a millionaire with it.
Would THAT be worth it then? Maybe not to you, but to the guy who came from a third world country and built his company from nothing and now he's living an upper middle class lifestyle? To that guy it's the essence of the American Dream.
Get a self-driving truck, and add some sort of people-sensing system that allows potential customers to intuitively flag it down. Then add a self-serve ice cream vending machine.
Now you can build a fleet of ice cream trucks that don't need human operators. I think you could make a few millionaires with that.
My point is not that automated ice cream trucks are the future. My point is that "small" improvements amortized across enough units can be significant.
Now, there's probably a pretty hard ceiling to the amount of income one of these trucks can bring in, so investing in business intelligence or a snazzy customer experience probably isn't a good investment. (Which is probably what parent was imagining.)
But don't underestimate the power of shrinking costs. If you sell a billion screws a year, a one-tenth of a cent improvement in unit manufacturing cost is a million dollars a year.
You can become a millionaire by scaling up almost any business. I doubt you’d become a billionaire but who cares?
That's probably what people said about coffee and cafes prior to Starbucks.
Only in a place where coffee is generally awful, and VC money easy, could the concept that became Starbucks ever come into existence.
But that's all beside the point. I'm not saying an Italian would be able to replicate Starbucks in Italy. What I'm saying is that there are countless opportunities staring us right in the face, every day, and 99% of people see a cafe and think "it can't scale, it's local demand only, there's no point, why bother", the remaining 1% see Starbucks.
Luigi Zingales, an economist at UChicago, once said, "the fact that Starbucks is not Italian is hurtful. The extreme agency problems of Italy make it difficult to scale firms.".
yes and -- informing someone that the term is more widely used than they might otherwise have known is indeed useful
I once got excited about what I thought was a cool idea (I can't remember what it was, but something along the lines of "black swan theory"). I didn't know how established it was, so I started inserting it in talks with the assumption people didn't already know about it. I belabored its definition and dwelled on it, when in fact people in academic communities had already discussed it in depth, and have moved on to other ideas. No one said anything, but no one engaged with me after my talks and I wondered why.
Looking back, I wished someone had nudged me and explained the context of that idea in those communities. I must have come across as a pseudointellectual (in that particular context). Feedback matters and is helpful when given kindly.
(on "regulatory capture" specifically, I admit I had not heard the term until about a year ago when it came up several times on Tyler Cowen's blog and on HN)
1. There is a decent chance that existing entrants are tied down by a focus on meeting the regulations rather than on delighting users.
2. You might be able to significantly scale-up and thus improve the unit economics.
While the market of people who can pass the means-testing to qualify for whatever government-subsidized benefit exists might be small, the nature of bureaucracy means there is often a MUCH wider pool of people who are "quasi-disabled", either permanently or temporarily.
Note that there are a few disabilities which are so overwhelmingly common that the market is already saturated. The classic example is eyeglasses.
3. The specific disabled population is a ready-made population of early adopters IF you identify that you can keep your focus on delighting users and just use the regulations to remind yourself of risks and edge-cases. (This really will depend quite heavily on the quality of the regulations -- notice the difference between Japanese zoning and SF-bay housing-approvals) Lots of legacy disability tech:
* Has a pretty frustrating maintenance cycle, so you can win on a strong customer service brand IF you can innovate on operations.
* Can be pretty frustrating to use, so you can win big on design.
A focus on delighting users rather than ticking boxes is naturally going to produce a naturally better product. Here is the key tactic though: lean on the early-adopters for high-detail feedback. This problem occupies a much larger proportion of their lives than the average user of a product.
This higher-strength signal of user needs is known as the "Curb Cut Effect". https://thingofthings.wordpress.com/2014/11/15/the-curb-cut-...
This also seems to hint at a good trick to turn any regulatory box-ticking exercise into purpose-driven-design. After all, a focus on privacy-by-design is better than a focus on the letter of GDPR-compliance, right?
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Hilariously, I used to work for a YC company unwittingly building assistive tech for my particular disability. Their Curb Cut effect was so ridiculously strong, they've occasionally written ad copy with reference to a symptom I've experienced and I'm pretty sure they still don't even realize it. Looking back, I now really wish I had been self-confident enough to explicitly disclose -- especially when their CEO started using a wheelchair.
That's the problem Dean Kamen had with his iBOT wheelchair. They were very cool and their users loved them, but they went for something like $25,000 each and likely needed frequent maintenance.
If you want Medicare to pay for a product, you need a positive Coverage Determination. And if you get it, you just opened up a 50M person market (obviously a subset, since not everyone will need it) and all you need is the patient to say to their doctor “I want that” and it’s paid for.
It’s a heavily front loaded business, but if can get reimbursement, it’s basically paid for, you just need customers to ask for it (I’m obviously simplifying, since it varies by product type, but medical equipment is a great example).
This is where most of the bizarre "as seen on TV" products come from: The inventor made a tool for people with disabilities, found that the target market wasn't large enough to sustain a business, and frantically tried to pivot. Pivoting is hard when you already have a large inventory of hard products.
If you can build something that able-bodied people are not only willing to use but willing to pay extra for, then you're good to go.