(Steal this idea, if it works, give me 15%)
Thanks to AI, the cost and speed of spinning up a SaaS startup has collapsed by 90%, but you still have to find a validated market need.
If only there were a crowdsourced online directory of tasks that individuals and businesses would pay for, plus data about their popularity, willingness to pay, and detailed requirements documents from multiple prospective customers – wouldn't that be valuable?
Good news, it exists! It's Upwork.
Ten years ago, this was Craigslist
In 2014, the smartest founders were "unbundling Craigslist" into dozens of niche vertical marketplaces, illustrated by Spark Capital in this famous graphic:
It was a clever way to spot underserved niches – if you (consumer) wanted something (apartment, airport ride, ‘casual encounter,’ used car), and you didn't know where else to look, you could find it on Craigslist. It was basically an index of unserved demand. Well, guess what...
Upwork is the new Craigslist
Today, if a business or wealthy consumer needs help with any random project, and there’s no SaaS, they'd probably hire somebody on Upwork. That's why, in 2024, with the rise of AI SaaS, the smartest founders are unbundling Upwork. Only this time, it's better.
Why it's better this time.
Most of those Craigslist marketplaces died, crushed by a few massive players like Uber, AirBnB, Zillow, Indeed and Tinder. That's because marketplaces are typically winner-takes-all network-effects businesses.
B2B SaaS, however, is, and will remain, highly fragmented, and can be quite profitable at small scale. That means almost limitless opportunity to find a niche and flourish.
Simple Next Step
If you have an idea for a SaaS business, go see if anyone's hiring for that job on Upwork. (If nobody is, that's good to know.)
If you find that project type, is it popular?
If it's popular, are there existing obvious SaaS competitors?
If you find a large under-served niche, study the project requests and look for patterns, do they validate your assumptions?
Find a few freelancers thriving in that category and hire them for trial projects yourself.
If they perform well and understand the market, maybe one can be your first hire!
Remember, if this works, gimme 15%! 😏