Framework
AI Should Be Deflationary
Most AI today is used to make businesses more efficient — cutting labor costs, increasing output per employee, improving margins — without passing any gains to consumers. The underbuilt opportunity is AI that lowers the price of professional services for the people who need them. A $1,200 accountant becomes a $499 AI agent. A $10,000 attorney becomes a $200 AI reviewer. The technology should compress the cost of expertise, not just the headcount required to deliver it.
How it works
- 1The efficiency gains of AI are currently accruing almost entirely to business owners and shareholders, not to the consumers those businesses serve.
- 2Pre-digital, pre-AI professional services markets (tax, legal, medical, financial) are the most obvious targets: high prices, poor service, no technology adoption, and captive demand driven by fear and information asymmetry.
- 3Deflationary AI products compete in a nearly uncontested market — most founders are building tools that help businesses save money, not tools that help consumers save money on the services they buy.
- 4The business model can still be strong: lower price than a professional, higher margin than human labor, recurring annual relationship, and massive TAM from customers currently underserved.
- 5Deduction.com is the canonical example: $16B market, $499 product, serving the 55% of Americans who currently pay $1,200+ to an accountant they cannot reliably reach.
Hear it on the podcast
I Already Know You Hate TaxesListen to the episodeMore from this episode
B2B Easy to Start, Hard to FinishB2B is easy to start — design partners are accessible, first revenue comes quickly, and you can reach $2–3M without massive distribution investment. But finishing is brutally hard: selling to thousands of businesses at scale is one of the most competitive and capital-intensive GTM motions in software. Consumer is the inverse: hard to start (expensive distribution, long time to first 1,000 customers), but the historical outcomes, market size, and competitive dynamics favor consumer at scale.Meet Consumers Where They AreDo not build a new interface and ask customers to learn it. Identify the medium where your target customers already interact with this type of service — email, text, phone call — and build the product to operate entirely in that medium. The lower the adoption friction, the higher the trust, and the faster the referral loop. No app to download, no portal to navigate, no new UX to learn means less resistance at every stage of acquisition.
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