For the Gold Mines
The Small City Segment thesis in 1859
I’m currently reading a PhD thesis from the 1950s that tells the story of James Oliver, the founder of Oliver Chilled Plow Works in South Bend. I’ll be writing a more in-depth post on him and the company at a later date, but it’s quite the story and played a big role in the development of South Bend from a trading post to an industrial center in the late 19th and early 20th centuries.
He started what would become this business in 1855 by buying into a small foundry on the West Race on the St. Joseph River in South Bend. Within a few years, he was experimenting with improved plows for area farmers. There was a gold rush in Colorado in 1859, and he took out the following ad in the St. Joseph County Register:
I don’t know if I could sum up the Small City Segment thesis any better than this:
“…you will be enabled to reach of mine of wealth beneath the rich soil of your own homes much sooner and surer than making the long and uncertain journey to Pike’s Peak or California.”
The challenge is to innovate the plows that enable people to do so.
What I’m Working On
These are threads I’m pulling on for future Problem Profiles. I’m not sure if they will make the cut yet for a full post, but I’m trying to learn as much as I can about them to find out. Any and all resources, connections, or first-hand accounts are welcomed!
Reduction in Health Care Services Offered
After writing the Small City Segment piece, a friend who has spent his career in healthcare wrote to me that it made him think of an interesting dynamic in healthcare that’s happening. As more PE firms and large hospital systems buy up small practices, there are a lot of cuts to services happening because of low margins and low volumes. This is leaving some services deserts, forcing people in smaller markets to have to travel to larger ones to receive care. If you know anything about this or anyone who might, please let me know!
Public Bus Transportation Incentives
Another topic that came up in a conversation about the Small City Segment was the government incentives around purchasing buses and how it may be leading to oversized buses being used when a larger fleet of smaller buses might make more sense. If you know anything about this or anyone who might, please let me know!
Costs of Sales
A common reason given for not selling into smaller markets is the costs of selling into them. This can limit what technologies make their way into these markets, especially for smaller firms. One example someone mentioned to me would be the software vendors available to small, independent physician practices - only the largest ones can afford the costs of sales, but that also means that small firms are a marginal customer and therefore not served particularly well. If you have stories or people that struggle with either side of this dynamic, I’d love to hear from them too!
If you…
are interested in building for the small city segment…
are already building for the small city segment…
know someone who might be/should be building for the small city segment…
want to contribute expertise to problem profiles…
or want to help us expand our networks of trust in small cities…
please subscribe and reach out at dustin@invanti.co.