Andrew Yang says startups should focus on lowering the cost of living

In short: Andrew Yang says a growing startup trend is building companies that lower everyday costs and give savings back to customers.

What's going on

Andrew Yang, an entrepreneur and former US presidential candidate, told TechCrunch he thinks the next wave of startup ideas will focus on lowering the cost of living. He said many businesses are built to take as much money as possible from customers. He thinks more companies will try the opposite approach, where the business wins by charging less.

Yang said he made a list of areas where people often feel they overpay, including housing, education, food, fuel, transportation, media, and wireless service. He pointed to Mark Cuban’s Cost Plus Drugs, which sells some medicines with a small, clear markup instead of high prices.

Yang’s own example is Noble Mobile, a budget wireless company he launched last September. It is a “mobile virtual network operator,” which is a carrier that rents space on bigger networks (like leasing a lane on an existing highway) instead of building its own cell towers. Yang said Noble Mobile charges less than traditional carriers and gives customers money back if they use less data.

What to watch

Yang tied this idea to worries about AI, which he says could pressure wages and reduce jobs. His argument is that if people earn less, they will care even more about cheaper essentials. A big question is whether investors will fund these kinds of consumer businesses, since Yang said some backers told him they would be more interested if Noble Mobile were positioned as an AI company.

Source: TechCrunch AI