These Two Trillion Dollar Industries Are Ripe For Disruption
If you haven’t heard yet, the newest buzzword in business is “disruption”. The experts (whoever they are) claim that we are living in an “age of disruption.” Amazon, Uber, Airbnb… It’s all disrupting the status-quo and leading us into a bright and glorious future.
However, disruption is not a new thing. The compass disrupted the astronomical navigation business in 206 BC. The printing press disrupted woodblocking in 1450. Edison nearly put the lantern industry out of business with his invention of the lightbulb.
But disruption is increasing. Advances in technology and the internet have condensed the time it takes to invent, market and test new ideas. We are truly living in an age of disruption, but it could be one that never ends.
People often ask: What will be the next Amazon? The next Uber?
One way to find out is by looking at industries that are ripe for disruption. Industries that haven’t changed in decades and are ruled by outdated dogma and regulation. That’s where the magic will happen.
There is an opportunity for a new wave of innovators, entrepreneurs and investors to help shape the future and make the world a better place for us all.
Here are what I see as a couple HUGE industries that are ripe for disruption:
The health & medical insurance industry is currently $1 trillion dollar market, and that doesn’t even include pharmaceuticals industry, which is another trillion dollar industry. Politicians have been promising to fix healthcare for decades. And there are complicated reasons that it doesn’t change, including the fact that three of the top five lobbying spenders come from this industry. The top health insurers continue to bring in major profits. In 2018, the CEO of Blue Cross Blue Shield (a nonprofit!) received $19 million in pay, while your average family struggles to pay for rising healthcare.
This might be why Apple is getting into healthcare. This might be why Jeff Bezos and Warren Buffett are partnering together to create their own healthcare company and take care of their employees directly.
“The ballooning costs of health care act as a hungry tapeworm on the American economy. We share the belief that putting our collective resources behind the country’s best talent can, in time, check the rise in health costs while concurrently enhancing patient satisfaction and outcomes.” Warren Buffett
This is an industry ripe for disruption, and trillions of dollars are available to whoever can create the best solutions.
I love what my friends at Sedera Health are doing. They call themselves a “medical cost sharing community” and base their approach to healthcare on a concept borrowed from early Christian community and how they cared for each other’s needs.
There are ample opportunities to innovate in this space. But it’s not easy. There is a status-quo effect to any industry, and you have to be certain that you offer a superior service at an affordable price, and that’s not easy to do. If you are up for the challenge, consider disruption in the healthcare space.
2. Higher Education
Aside from government, there might not be another industry that has been undisrupted for centuries with certain patterns and principles that seem to be set in stone. And despite that, we are already seeing fractions of this $2 trillion industry get disrupted from all around, including within.
Online education is certainly the biggest disrupter of this industry, with most university programs now offering online options. Organizations like Khan Academy and Udemy are providing education to the masses unlike anything we’ve seen before, and I believe this could just be the beginning.
The largest motivating factor in this market is rising tuition. Forbes reports that the cost to attend university is rising eight times the rate of wage increases. And this increase is being paid by cash, it’s being financed by debt. This is motivating many students to ask “Is it worth it?” and look into alternatives.
The demand for university demand has been strong because the demand for university graduates has been strong at large corporations that provide most of the jobs. I believe this will most likely change over time, as our creator / gig economy grows and more millennials are places in key leadership positions.
Education is important, but the structure will change. In the future, education will be higher quality and more customized, while costing less money and taking less time.
Will you be a part of shaping the future?