Unsexy Markets Win

Anand Sanwal shares insights about the advantages of building businesses in unsexy markets, particularly in data and information services. He believes these markets offer better opportunities because they're often overlooked by others, leading to less competition and better profit potential.

Key Points:

• Characteristics of Good "Unsexy" Business Opportunities:

  • High consideration (customers putting significant money/risk)
  • Opaque markets (hard to find information)
  • Variable SKU (products can't be easily compared in a table)

• Data Business Success Factors:

  • Willingness to do "nasty work" of cleaning data manually
  • Building once and selling multiple times
  • Less competition from smart people who avoid unsexy markets

• Building Moats:

  • Pain tolerance for manual data work creates barriers to entry
  • Private data becomes more valuable in the age of GPT
  • Data that requires frequent refresh is more valuable for subscriptions

• Market Signals:

  • Look for industries where people ask in Slack groups "does anyone know X?"
  • Markets where comparison shopping is difficult
  • Areas where the internet hasn't made information transparent

• Business Model Advantages:

  • High margins from reusable data assets
  • Subscription revenue potential
  • Less pressure from venture-backed competitors

• Customer Value:

  • Helping make high-stakes decisions
  • Reducing risk in business choices
  • Providing hard-to-find information

The approach emphasizes building sustainable businesses through hard work in overlooked markets rather than chasing trendy, competitive spaces.