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Comment by rsweeney21 | Hacker News Reader

Technology enabled service companies have the potential to be one of the next big waves in software. I spent last summer trying to figure out what I wanted to do for my next startup and it was amazing to me how many businesses run on paper, excel spreadsheets and email. Trucking, recruiting, cleaning, building security, building maintenance, whatever.

The beauty of a tech enabled service company is that you can build it without raising outside funding. You use the earnings from the services to fund product development.

The other great thing is that the market is already proven. You just build a competitive advantage through software that allows you to work more efficiently or provide a better customer experience.

I ended up starting a technology enabled staffing agency for the tech industry.

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The industries you mention are huge. And fragmented.

But once we start adding technology(not necessarily just software), they will become much less fragmented, with a few big winners.

Doesn't that mean venture capital is a necessity ?

No.

Maybe. I don't think Atrium will ever become one of 2 or 3 big law firms. There will always be thousands of business law firms. Tech enabled service companies don't seem to have the same winner-take-all nature you might see in platform or network effects businesses.

Even without the winner take all potential, it still makes for a great $100M business idea that seems much less risky to me. There can be dozens or hundreds of $100M trucking companies. That's a lot of winners. :)

My suspicion is that AI/ML will drastically change the mechanics of how this works. Down the line, if Atrium has access to a million documents that it can compare and contrast to, it might be significantly better then the legal service with none.

The worst bit is that this will cause a reinforcing loop, of more customers flooding to the market leader, causing the market leader to develop better AI, causing more customers, etc etc.

Let's say I could offer jobs to every truck accross the US, and had access to every trucking job customer.

This enables me to plan the best routes and be the most efficient. My platform will win.

But you imply there are hundreds of niches.

That's interesting.

What am I missing ? How do you analyze that market ?

Relationships matter. Independent truckers or small trucking companies have close relationships with their customers. The matters in both the Business-As-Usual case (Ron drives a beer distribution truck which makes the same route to the same bars twice a week) and the Not Normal case (Hey Fred, I have a load that needs special handling and immediate delivery response).

Large, generic haulers just don't offer the same kind of customer service.

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