When it comes to starting a successful business, hard work, good luck, passion and great ideas all come into play but there's often something else -- timing. That's why Inc. Magazine analyzes the American business landscape each year to determine which industries have the most untapped market potential.
Based on interviews with entrepreneurs and successful CEOs, venture capitalists and industry experts as well as an analysis of raw data, Inc. Mag presents this list of emerging industries each year. Inc. writer, Graham Winfrey, who helped spearhead the initiative joined Yahoo Finance to highlight some industries that are "ripe for growth."
Fantasy Sports
Fantasy sports services is estimated to be a $1.4 billion market, according to Winfrey, that's growing from a growing interest in sports both fantasy and real, an increase in advertising interest and greater access to fantasy platforms via Broadband and mobile.
"Fantasy sports has been around since the 1980s but when it migrated to the internet it really took off," says Winfrey. "It's not just fantasy football anymore, it's fantasy baseball, basketball and hockey. The field is growing tremendously."
The industry grew 7.7% in 2014 and is expected to grow over 7% annually for the next five years. The market is still dominated by big names like Yahoo (our parent company) and ESPN but start-ups like FanDuel which was recently valued at $1 billion show that there is plenty of room for more.
Legal Marijuana
The money is in the pot (sorry) when it comes to legal marijuana. With Colorado, Washington, Oregon and Alaska legalizing recreational marijuana in the past few years this is a very new and relatively untapped industry. Colorado governor John Hickenlooper has said that sales of recreational and medical marijuana in his state will reach $1 billion this year. Medical marijuana throughout America growers have seen revenue increase by about 16% each year since 2009 and made about $2 billion in 2014.
"There isn't a lot of competition yet because this is such a new industry," says Winfrey. "This could be a very fast-growing sector during the next five to ten years."
Of course there are many risks to consider when entering this legally tricky business. Laws are always subject to change, most banks don't accept money from marijuana-related businesses and Federal tax law doesn't allow deductions for business costs from these companies.
Relaxation drinks
Monster, Red Bull, Rockstar: the market is already flooded with energy drinks, but what about relaxation drinks? According to Winfrey the relaxation beverage industry is a $150 million sector because of American's inability to sleep. IBISWorld says that this market is far from saturated and that even though there are 450 drinks purported to aid in relaxation or hone focus on the market convenience stores are still asking for more.
IBISWorld says that growth will continue at 12% over the next 5 years and the industry is expected to be worth $263 million by 2025.
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