Yesterday we posted a Startup Spotlight on Verifiable. An innovative new startup that came out of Y Combinators 2020 batch and is re-inventing how healthcare networks verify their providers' credentials and ensure ongoing compliance. We wanted to follow that up today revisiting a previous article we had written about the rise of a new category of SaaS startups we call Data Infrastructure-as-a-Service.
To start from the beginning, what is Data Infrastructure-as-a-Service? (Yes we know, another SaaS subcategory, we promise this one is legit and here to stay) Typically for an industry to build an internal tool, they need to hire an engineer or development shop, these groups or individuals gather requirements on all of the data points needed for the specific functionality that the company is looking for. It's a time-consuming process and typically, once the data on the back-end is untangled and plugged into the front end, you have a pretty static project that isn't scalable. Enter a new generation of founders who want to take problem-specific data sets and verticalize the infrastructure instead of build single-use horizontal solutions.
The trend we are seeing emerge with these solutions is industry specification. Take Verifiable and Axuall, both Data Infrastructure platforms bring credential and compliance management for healthcare networks into easy to use, documented APIs. Empowering healthcare systems to easily plug those APIs into self-made front end apps and all the data needed just flows right in. Think of it likethe plumbing in your house. All the plumbing in the walls is built to carry hot and cold water to where it needs to go, if you want to replace a sink or shower head in your home you don't want to have to pull out all the pipes, you want to just swap out your old sink for the beautiful new farmhouse sink and when you turn the water on, it just works. That is what Data Infrastructure platforms such as these enable their customers to do.
We have seen this approach pop up in a few other industries including AgTech (Leaf Agriculture), Banking and Payments (Stripe and TrueLayer), and insurance and employee benefits (Noyo). While there certainly has been some amazing innovation in this space but what excites us the most is that there is still so much room for growth. There are many industries where data infrastructure still lags. Auto insurance? Travel? Education? Which industries will be next? Imagine someone building an API that contained all the necessary data to offer car insurance. The ability to check and verify VIN numbers, identities, driving records and other mission-critical information. The auto insurance industry is a $308bn dollar industry, could a start build the auto insurance API to shake up the industry? (If you know anyone trying to do this let us know!)
The future is very bright fo the Data Infrastructure space and we are excited to see what comes next. Entrepreneurs with strong industry knowledge are sure to emerge, building the next Verifiable for _________. If we ran a fund, we certainly would be interested and looking for these startups given the success of some of the companies we have mentioned today. If you know of any startups tackling this problem, let us know! We always are looking for amazing startups to feature and founders to meet.