Problem

Collection Agencies suck. They typically are aggressive and annoying and use a brute force approach to things. Skeptical they are using data or technology to create a more elegant, user-centered approach to the situation.

Solution

If a consumer or business has an outstanding debt that goes to a collection agency, it comes with a penalty to their credit score (and is annoying). By leveraging data & technology, a reimagined collection agency could come up with a far more personalized and contextually-relevant approach to individual consumers; furthermore, they could take steps to a. provide guidance for repairing the debtor’s credit score and b. provide consumer-friendly financing options. Furthermore, seems like a lot of the current entities are human-powered in spite of the routine nature of their interactions; so technology could create some significant cost & operational efficiencies.

Why it could work

Haven’t seen much competition and hard to imagine that building a better collection agency is particularly appealing for many entrepreneurs, which is actually a positive. Doubt that it would be really hard to start taking out legacy collection agencies and a SV start-up could get traction out of the gate by selling into the SV ecosystem.

Why it could fail 

I haven’t researched this enough to provide good reasons this type of venture would fail.

TAM

$11B domestic (IBISWorld)