The trillion-dollar market to remake business applications
Amidst a sea of consumer facing businesses, the CEOs of three small- and medium-sized business, or enterprise focused on-demand companies, explained their businesses in a talk titled “On-Demand, B2B.”
Applying on-demand businesses models to corporations isn’t revolutionary; existing platforms such as Uber and Skype have formal business facing units and among big businesses. However, the proliferation of these services significantly trails their adoption among consumers, despite B2B services representing well over $1 trillion in annual spend.
The Emerging Models
On-Demand people marketplaces – businesses which leverage freelance labor to provide services in-person, such as the emerging class of applications providing on-demand office cleaning/maintenance or technical repair – connect people in-person with physical office spaces.
On-Demand Crowdsourcing-Platforms use a supply of qualified experts to provide services and intelligence in a near-immediate time frame. For example, on-demand customer support platform, directly, or on-demand security platform.
Mapping the market
Interestingly, much of the early innovation in the B2B on-demand space has occurred within some of the smallest verticals by market size. Corporate catering, for instance, is so crowded, while larger spaces remain relatively untouched as the infrastructure and supply chain is well established.
On the other hand, services such as Universal Avenue, part of the movement towards outsourced, on-demand sales, are a higher friction change – requiring a fundamental behavioural shift on behalf of the enterprise.
Further, unlike traditional enterprise software, new on-demand services sell into a variety of different managerial roles.
The First Innings
According to a recent report from CBInsights, funding for on-demand mobile service companies grew to a total of $4.1 billion in 2014 across 79 deals. Even excluding Uber’s two mega-rounds in 2014, the industry generated $1.7 billion in investment dollars, and is on track to double that total in 2015, showing how nascent the B2B market truly is.
Given the increasing number of freelance workers amongst millenials, and emerging software and digital communities catering to freelancers, the category of enterprise focused apps should continue to grow, leveraging these significant tailwinds.
In the meantime, expect the on-demand battlefield to continue transitioning towards the enterprise/SMBs with hundreds of new platforms emerging in the coming years.