In this digital age we live in today, entire industries are being disrupted by new business models & new technology more than they have since the beginning of the industrial age. To understand what I mean, look at what these companies have done in these industries.
Skype – Skype brought free global calling to the masses, cutting significantly into the long distance business of the telecom industry. Skype also made video conferencing mainstream, something you would think would have come from one of the global telecom giants but didn’t.
Apple – The iphone and smartphones in general have disrupted many industries including land lines, watched, alarm clocks, compasses, printed mapping, dicta-phones, portable music, photography and the retail music industry just to name a few. This will continue as the invention of the App economy works to reinvent many activities.
Wikipedia – Wikipedia, the free online encyclopedia has disrupted this industry so much that the former market leader Encyclopædia Britannica ended print production after 244 years in 2012.
Amazon – Amazon has disrupted the book publishing & retailing industry significantly and even the cloud services industry which isn’t that old. Amazon continues to disrupt with many of it’s new products and services.
Change is the only constant and if the past 30 years says anything, the disruption is just beginning which is exciting for those that like to disrupt the status quo.
If you’re wondering where the next big opportunities are going to be, here is a list of markets ready for significant disruption. These were submitted by people responding on Quora to “What are some $10B+ markets ripe for disruption?“& “What are the set of problems that young entrepreneurs should focus on that will yield the next $100 billion companies?” and other resoruces sited below.
33 Markets Ready for Disruption
- Education: There is a ton of value created by educating the masses in emerging and under-developed markets and those able to capture this value will do very well.
- Construction: 3D printing is on the cusp of becoming a mainstream phenomenon. And yet, contractors are still driving their big trucks over to Home Depot.
- Insurance: Micro and Peer insurance (everything can be insured, and people can insure other people)
- Water rights and distribution: the clean water we are polluting for natural gas wells will soon be worth more than any form of gas
- Loans: who gives them and how people get them (micro and peer financing)
- Prime Time TV lineup: this will be all on demand and will change TV advertising forever
- The legal profession: Simple contracts could be generated and processed by machine at far, far lower cost than a lawyer’s hourly rate. Some legal documents could be modeled as graphs of conditions and outcomes, which could then be compared with tree-diff algorithms and annotated with other data.
- Intellectual Property: Consider the black box of patent applications, as well as the aftermarket (or lack thereof) for IP. “Patent Troll” is the latest buzz word; individuals or firms pick up bulk lots of IP on the secondary market and file suit against major companies for infringement, hoping for a big win. However, what if there were a more transparent and readily accessible market for IP?
- Financial Services & Wall Street: Read what Chris Dixon says about disrupting Wall Street.
- Data Informatics: Corporations and professional services firms can pay upwards of six-figures for limited (annual or even monthly) access to certain specialized data stores. While some data pools are proprietary, pulling information from truly unique sources that cannot be duplicated, others are currently providing nothing more than the service of aggregation and dissemination of publicly available data.
- Insurance: It is a black box, from the way in which “risk” is calculated by individual companies, to the way in which claims are assessed for validity and payout. Having just received new insurance, I am reminded of the obscure legalese used in even the most basic of customer facing communications – I dare you to show me an insurance company that is transparent in its communications, or even one with a customer experience better than that of an armed robber.
- Politics: Campaign spending alone stretches into the billions when looking at the top 2-3 levels of government. Consider aggregate spending on campaigns at all levels, in addition to significant sums spent on lobbying and other related activities. Disruption would certainly be difficult in this space, but there are examples of companies already attempting, and succeeding in some cases, to disrupt particular verticals.
- Real Estate: The fact that a 5% commission is extracted by the brokers for matching buyers and sellers is today’s information age is outrageous. The buy side of the market is very opaque with little visibility into who is interested in buying what and where. Crack that nut and you are the next Zuckerburg.
- Moving industry: A 16 billion/year industry formed mostly from small players. 50 companies have 45% of the market. The rest are small players, companies with under 10 employees.
- Packaging: In USA alone the CPG industry size is $2Trillion + ! Anywhere between 10% to 40% of that money is spent for the packaging of the product. That is the cardboard, polythene, plastic, paper etc meant for covering the actual product.
- Recycling: There’s still so much we can do to recycle effectively. There’s a huge opportunity here, but I wonder if we’ll capitalize on it only after we reach a higher level of scarcity.
- Landfill Resource Reclamation: As we continue to come to terms with resource scarcity, we’ll dig deeper into our own trash heaps to reclaim re-usable materials.
- Battery Technology: If we can make tiny batteries that never have to be recharged and that don’t cause a nuclear melt down we will advance tremendously.
- Fast Food: The fast food industry is known to deliver more than a quick ready to go meal. Fast food also delivers some of the highest calorie foods eaten during a typical day. fast healthly food will change this industry.
- Software Operating Systems: The cloud is gaining ground quickly. OS’s that don’t require booting, installing, or updating by the user are surely preferred over those that do.
- Rare Earth Metals: This enormous industry, it has mostly been pushed into China were extraction labor costs are low enough to be economical. However, with >50lbs of rare earth metals under the hood of your typical Prius or EV – substitutes are needed as China cuts supply (recently announced that <50% of China-mined rare earth metals were available for export).
- Payments: While PayPal never quite lived up to it’s vision of displacing the major processors (Amex, Visa, MasterCard), this area is beginning to heat up again. 2%+ cost for each transaction is the reason $24T of B2B transactions are still completed using paper check.
- Low Cost Distributed Energy and Sanitation solutions: Developing countries have a large need for dirt cheap, compact local energy and sanitation solutions, but the same applies to many of the developed countries too. Who wouldn’t like the prospect of generating their own energy with small solar panel or other green energy solution? This is especially true when the electric grid becomes unreliable or cost of energy hikes up rapidly
- Diamond retailing: No major disruptions as of yet. This is a $72 billion a year market. Bluenile.com, the biggest online player, does about $350 million a year in revenues.
- The gambling industry: Currently unregulated in half the world (Thailand, India etc) and most bettors go through bookmakers with high fixed odds. With online betting exchanges (Betfair, Smarkets) you get the best prices because of efficient markets and high volume/liquidity.
- Sewing garment factories: as clothing companies get into “fast fashion”, there needs to be a better way to find, vet and analyze factory capacity and order.
- Medical Devices: Most big companies have commoditized existing equipment (esp.Surgical Devices). Much of the new features being added are bells and whistles to justify a price hike or reduce liability. There are a lot of opportunities in their improvement and total replacement.
- Healthcare: Simply put, healthcare is not working and it will get worse as the population ages. Effcientcies need to be created or this will bankrupt governments.
- Weddings: A 74+ Billion dollar industry that’s fragmented and highly inefficient, probably the last industry left where consumers still shop from a trade show, magazine or google search.
- Business productivity software: Right now, 100s of millions of people are using Microsoft Office on PCs, while their kids are using smartphones, tablets and web applications. The future belongs to collaboration and productivity apps designed for this new reality.
- Taxation: The tax system is another system designed for and by accountants. If the congress can get a simple(r) tax system designed and implemented, the entire accounting system as we know it today will be turned on its head. (which means they’re probably pretty safe)
- Automobile sales and marketing: Particularly at the dealer levels – if you’ve ever purchased a car you’ll realize this industry is completely broken. Car dealers are packed full of sales people who don’t understand the difference between sales and marketing, particularly online advertising.
- Mattresses: They cost too much for what they are. Someone needs to disrupt this market.
- 6 Industries Ripe for Disruption (inc.com)
- The Difference Between Innovation and Disruption, and Why China Needs the Latter (techinasia.com)
- Disrupt ! (newmediaandmarketing.com)
- Is data the next disruptive technology? (csironewsblog.com)
- Is More Disruption What We’re Really Looking For? (janresseger.wordpress.com)
- Don’t You Dare Say “Disruptive” (newrepublic.com)