AI business ideas- a trillion dollar opportunity
ChatGPT notably garnered a million users within the first five days of its release and reached 100 million active users by January 2023, with an estimated 180.5 million worldwide unique visitors by August 2023.
As of September 7, 2023, almost 15 million users, with over 1 million active users, were registered on Midjourney's Discord. Other sources corroborate this growth, with the registered user numbers ranging from 15 to 17.6 million and daily new user registrations approximating 90,000.
The adoption of AI tools like ChatGPT and Midjourney has been so fast and impactful it would be easy to be dismissive of the business ideas and opportunities available to budding entrepreneurs - as if the proverbial ship has already sailed.
The reality is these are extremely early adopters of this technology, much like how vertical SaaS solutions are still slowly being adopted by Accountants, Lawyers, Construction workers, Grocery stores etc. AI is likely more than a decade out from adoption in the workplace as vertical solutions and there are huge amounts of business ideas and opportunities available.
One of the most compelling early use cases of AI in the workplace is the solar industry, computer vision aids in remote solar site measurements, enhancing the solar design process. Tools like the Street View Ruler employ computer vision to calculate measurements using multiple images of a site, which are used to provide quotes for solar panel fitting without workers doing onsite visits. Additionally, computer vision is utilized for automated monitoring of solar panels to detect anomalies and for semantic segmentation of rooftop PV panels, which can be crucial for large-scale panel installation and maintenance.
Current State of AI Adoption
AI adoption is still in its early stages, with a user base of tech-savvy individuals, start-ups, and innovative enterprises (see customers of companies like Writer). However, the extension of AI to address the needs of industry verticals presents a significant opportunity, especially for SMBs and resource-limited companies operating in niche markets.
The spending power of SMBs, particularly in the context of technology investments, continues to be a huge opportunity. SMBs worldwide are projected to allocate USD 1.45 trillion towards technology in 2023, marking a 6% growth from the previous year [source].
SMBs often encounter resource constraints that limit their growth. Vertical AI, akin to Vertical SaaS, can provide tailored solutions that automate routine tasks, optimize operational workflows, and generate actionable insights, addressing the unique challenges faced by these businesses.
Getting business idea inspiration from Vertical SaaS to build Vertical AI
The success of Vertical SaaS companies across industries are great business idea inspiration for vertical-focused AI tools.
Here are examples of Vertical SaaS companies across different industries:
Finance: Riskalyze offers solutions for financial advisors to manage investment portfolios.
Insurance: Applied provides cloud-based software for independent insurance agencies to automate processes.
Healthcare: WellSky offers Customer Relationship Management (CRM) software for home care agencies.
Construction: Procore provide payment and project management solutions, respectively.
Restaurant: Toast offers POS and customer management tools for restaurants.
Sports: Thapos offers solutions for managing players, associations, coaches, clubs, and leagues.
Pharmaceutical: Veeva Systems provides solutions for the pharmaceutical and life sciences industries.
Real Estate: AppFolio offers software solutions for real estate management.
The Vertical AI Opportunity
The big question is whether the existing Vertical SaaS providers will integrate AI powered products into their solutions quickly, or they get disrupted by innovative purpose-built solutions emerge with built with AI as a core component of their roadmap.
If the adoption of SaaS platforms was anything to go by, it will largely be innovative new solutions capturing the marketshare over time - with a select few large incumbents who are able to survive.
Vertical AI, modeled after the success of Vertical SaaS, presents a pragmatic approach to delivering tailored AI solutions. This approach aligns AI technologies closely with the operational needs and resource capacities of SMBs and resource-limited companies, paving the way for broader adoption and more effective utilization of AI.
There is huge opportunity for entrepreneurial founders to build AI-first Vertical SMB products - and huge collective budgets ready to pay for them. Let's get building!