I’d think about this less as “which niche sounds cool?” and more in terms of leverage.
Software is attractive because the economics can get very good once it works.
The first customer is insanely expensive. You have to research the problem, build the product, fix bugs, create onboarding, set up payments, support, distribution, etc.
But the 100th or 1,000th customer usually does not cost anywhere near 100x or 1,000x more to serve.
That’s the leverage.
Your fixed cost is high at the beginning, but the marginal cost of adding another customer can be very low, while the additional revenue is still meaningful.
That’s also why good SaaS can compound so aggressively. You keep improving the same product, the same codebase, the same acquisition channels, the same onboarding and the same brand instead of starting from zero every time you want to make another dollar.
Compare that with a service business. If you double the clients, very often you also need more employees, more managers and more operational complexity. Revenue grows, but costs grow with it.
With software, ideally:
- product gets better
- distribution gets better
- retention gets better
- customer base grows
- revenue compounds
- marginal cost stays relatively low
So I wouldn’t search for a “billion dollar idea.”
I’d search for a painful recurring problem where:
- People already spend meaningful money solving it.
- The solution can be delivered mostly through software.
- The same product can serve 100 customers without needing 100x more labor.
- Customers need it repeatedly, not once.
- The market is large enough that you can keep adding customers for years.
That’s where the real upside is.
The best SaaS businesses are often boring because the value is not in how exciting the idea sounds. The value is in having high leverage, recurring revenue and a cost structure that improves as you scale.