The Rise of Citizen Professionals
New software applications will empower knowledge workers and allow them to replicate skills that traditionally required advanced professional training, turning them into “Citizen Professionals”
Many of the “expert” professions in our society today look much like they did twenty years ago. The roles of doctor, lawyer, financial officer, tax professional, and accountant, for example, are very similar to what they have always been. These professions have not been drastically transformed by software. In a business context, size of organization and geography still play a major role in access to specialized skills. Small and medium-sized businesses cannot afford expensive professionals in areas such as finance, tax, supply chain, and engineering. There is still a big gap between the haves (large enterprises) and the have-nots (SMBs).
At 645 Ventures, we believe that a next generation of billion-dollar software applications has the potential to level the playing field between enterprises and SMBs, and at the same time empower the average knowledge worker who is not an advanced expert. This is because software now has the ability to perform tasks that were previously considered to require advanced memorized knowledge, and automate skills that were perceived not to be able to be automated. What is unique about this new wave of software applications is that computing power and learning ability of software may finally fundamentally disrupt the roles of experts. These software applications will enable the average worker to replicate the skills of the professional, and we call these workers “Citizen Professionals”.
Examples of Citizen Professional companies have begun to proliferate across sectors and reach large scale. Shopify ($58 billion market cap) has empowered the average person to be able to build and scale an e-commerce company. Tableau (acquired by Salesforce for almost $16 billion) has empowered the average worker to visualize and understand their data. Companies such as FreshDesk have enabled SMBs to access high-quality accounting tools at a fraction of the cost. Canva enables individuals and teams to design and publish anywhere, leveling the playing field for high-quality design.
The impact of this new generation of companies is to truly empower the average worker in a business or organization. They reduce the cost for SMBs, and also shift the cost curve, from expensive up-front spending new hires to software subscriptions that can be paid gradually. They de-risk the process of bringing on new capabilities and expertise. In the case of companies like Shopify, they also simplify the process of building and scaling a new startup.
They Begin with “Commodity” Expert Work, but Gradually Move Up the Stack to Perform Highly-Advanced Tasks
Citizen professional companies often begin with work that is perceived to be commodity or non-differentiated within an expert field. As an example, in the legal field, software is currently being applied in corporate law areas that are characterized by rote, repetitive work, such as document drafting and contract editing. However, this commodity work is a Trojan horse for software to be applied in areas that have to-date been considered the purview of only experts. For example, while corporate lawyers pride themselves on being able to understand advanced deal provisions, software will also eventually be able to expertly negotiate these complex terms as well. This “Trojan horse” approach enables Citizen Professionals companies to gain a toehold in the SMB, and eventually move up-market to the enterprise. This is a playbook that has been applied by software companies of previous generations. As an example, Salesforce initially gained a toehold in companies that couldn’t afford expensive on-premise CRM systems like Seibel, then eventually moved up-market to displace Seibel in the enterprise by adding product features.
They will Reduce Reliance on Expert Memorized Knowledge
Many expert professions today are dependent book knowledge that has been memorized by the expert, often through many years of study. As an example, a tax professional spends years studying the tax code, memorizing the meaning provisions and statutes. Software will drastically reduce the value of this memorized knowledge, rendering it much more of a commodity. The ability of software to analyze and recall the tax code is much greater than that of a human. As such, companies may be able to utilize software rather than rely on a tax professional to prepare the company taxes.
Empower the SMB by Democratizing Access to Professional Services Capabilities Previously Only Available to Large Enterprises
Today, large enterprises can afford to hire a breadth of highly specialized employees; SMBs on the other hand can’t always afford a Chief Financial Officer or a Chief Security Officer, and end up resorting to amateur solutions, or no solution at all. Citizen professional companies remove the artificial barrier between enterprise and SMBs. As an example, there once was a time when only enterprises had a web presence, now almost every SMB has an online presence or footprint as a result of the democratization of web development, thanks to companies like Wix and Squarespace. Citizen Professional companies will level the playing field for many additional types of work.