Arbitrage is riskless profit — the holy grail of finance. Buying something for one price and instantly selling it at a higher price. Since there’s no risk involved, anyone will take an arbitrage. These are the most competitive opportunities.
The concept can be extended to the startup world. Businesses lie on a spectrum of arbitrage → from Arbitrage to Art. On one end, you compete to sell a commodity. One banana is pretty much as good as another, so customers take the one with the lowest price. On the other end, you have one-of-a-kind products. There’s only one Mona Lisa. What will people pay for that?
It’s easier to get up and running with a business closer to the arbitrage end. But will it get you to where you want to go?
