10 Business Software Startups to Avoid

Dharmesh Shah wrote a rather interesting post on his site OnStartups enumerating the top 10 most tempting small business software startups. I’d highly recommend giving his original post a read. But I can list his top 10 business software startups to avoid here:

1. Project Tracking/Time Management/Bug Tracking
2. Community Discussion Forums
3. Personalized News Aggregation/Filtering
4. Content Management
5. Social Voting and Reviews
6. Music/Social Events Location Applications
7. Dating and Match-Making
8. Personal Information Management
9. Social Network for ________
10. Photo/Video/Bookmark/Whatever Sharing

Shah goes into greater detail about what each startup encompasses, but I think for the most part, successful small business software startups already know to steer clear of these opportunities. In most of these categories, you already have a huge competitor that’s entrenched in the market. Your business software startup isn’t likely to be the new Facebook, or the new Newser, or the new 4Chan, or the new Twitter, or even the new Match.com.

Online business startups fail when they personalize their software system. Maybe they see three little flaws in an already large system and think that by fixing those flaws, they can make a name for themselves online. The truth is that 90 percent of the users of these large online systems don’t care about those three flaws. So instead of coming up with the next big thing, these small business software startups end up throwing time and money down the drain on software startups people neither want nor need.

The Internet is a fantastic place. There’s all sorts of possibilities for startups. And I’m not one to say that small businesses shouldn’t take advantage of this medium. But whatever you do, it has to be unique. Take the time to really research your market.

What other business software startups do you think should be avoided?