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Data Moats Disappearing?
Matt Ober
January 03, 2025
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Are data moats disappearing? Not all data, but things are changing quickly
In the last 3 months, the number of DaaS (Data as a Service) startups I have seen has increased dramatically and one thing I am starting to see more clearly is that creating data moats is becoming easier. Or maybe the ability to create a data moat is disappearing as it’s easier now with AI and computing to create once difficult datasets.
What once took 10,000 people off shore in a low-cost country crunching, cleaning, and collecting data, can now be done with a fraction. AI, computing, language translation, combining datasets, and the ability to do all of this at scale is changing rapidly. With this rapid change, smart entrepreneurs are starting companies and talking about building multi-billion dollar datasets or companies built on unique datasets with less than 100 people. From finance to real estate, to insurance, and everything in between. The unique datasets I am seeing created and then used in real workflows are powerful.
I wrote a post on Linkedin about Factset and whether it can be disrupted. It now has close to 150,000 impressions and what it has me thinking about more and more is who are the data producers, the data delivery companies, and the companies creating real use cases with data where they collect a toll aka cash with their product such as indices.
I don’t think all data moats are going away. There are unique data assets, like Stocktwits, that you can’t replicate or build easily. It’s been around for 15+ years, has millions of users, and data is created every second. The data that can be created quickly and in new ways is public data, web scraped data, government filing data in all languages, videos, and audio that can then be converted to data & text, and the list goes on. There is all of this data that hasn’t been digitally collected, stored, tagged, combined, and made easily accessible to the masses. This data in very niche verticals or for very unique workflows starts off looking like small ideas but can be massive value creators and unlock multiple opportunities for expansion. These are the areas that excite me and where I am spending more and more time.
The data moats are disappearing, they are changing, and they are being created faster than ever before. The next DaaS behemoth is being created right now and we will wake up and wonder “Where did they come from?”
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