My First Million
The best business ideas come from noticing what's working and doing it better, faster, or for a different audience.
Regulatory Compliance Arbitrage
Build businesses around government-mandated compliance requirements where non-compliance leads to jail time or massive fines
How It Works
Government regulations create non-negotiable demand with extremely high switching costs - customers will pay for mission-critical, relatively cheap software to avoid legal consequences
Components
Identify new or complex regulations
Build software solution for compliance
Price as 'relatively cheap but mission critical'
Target businesses that must comply
Expand to other countries with similar needs
When to Use
When new regulations pass or existing ones become more complex, especially in niche industries
When Not to Use
When regulations might be rolled back, market is oversaturated with solutions, or compliance requirements are simple
Anti-Patterns to Avoid
Example
“Italian banking regulation software - banks must comply or face massive fines, won't rip out working solution, and Italy will only add more rules over time”
Related Knowledge
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Audience Co-Founder Framework
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