The Expertise Gap Test
- Difficulty
- Moderate
- Time to result
- ~months to results
- Steps
- 6
- Confidence
- —
Armoo's rule for choosing which service business to build and what to charge for it. In B2B services, clients pay for expertise, and the depth of expertise you can sell is directly proportional to the gap between where the client currently is and where they are trying to get to. A brand that is merely mediocre at Instagram has a small gap, so the ceiling on price is low; a brand that has no idea how to build and own a YouTube channel has a large gap, so the fee can be much higher. Two modifiers apply: the gap must still be open (once clients hire in-house, the wave has passed), and the payoff has to arrive fast, because buyers pay far more for speed than for eventual results.
Origin
Extracted from Deep Dive with Ali Abdaal
How to run it
- 1
List the problems you could plausibly solve
Start from areas where you have some edge — an audience you understand, a platform you use natively, a paradigm that is new to the market.
- 2
Measure the gap for each
For every candidate, ask where the buyer is today and where they want to be. Estimate the distance honestly. That distance, not your effort, sets the price.
Pro tip New frontiers create the widest gaps — brands always want help navigating a new medium, whether that was radio, TV, Google ads or a new social platform.
- 3
Check whether the gap has already closed
If the client already has people doing this in-house, or the knowledge is common, the gap is small and the answer is why would we need you. Armoo's test: which part of this do brands still not fundamentally understand?
Watch out Riding a wave that has already broken caps you at a small lifestyle business, not a scalable one.
- 4
Score time-to-payoff
A client spending £100k is spending it to make more back. Prefer problems where you can show return quickly; slow-payoff services require patience from both sides and are much harder to sell.
Pro tip Engineer the offer to shorten time-to-value, not just to increase value — supplements outsell fitness for exactly this reason.
Watch out If you promise a quick fix you cannot deliver, the ROI story collapses on the first campaign review.
- 5
Narrow to where your edge is defensible
Within the chosen gap, pick the segment where you specifically win. Armoo chose Gen Z because he understood that audience and knew a competitive edge existed there, rather than being a generalist influencer agency.
Pro tip Narrowing raises perceived value rather than shrinking the market.
- 6
Price on the gap and re-test it annually
Set fees against the size of the gap you close, then reassess: as the market learns, the gap narrows and margins compress. That is the signal to move to a newer frontier or to exit.
In the wild
Having sold Entrepreneur Express and seen that the buyer's real interest was the network of Facebook pages, Armoo concluded the value lay in social. He then reasoned that brands always want help navigating a new frontier of people, and that Gen Z was both an audience he understood natively and one where a competitive edge existed. Colleagues asked why not simply be a broad influencer agency; he argued that declaring 'we are for these people' would increase the value of the service. Fanbytes went from zero to about 70 people over five and a half years and sold to Brainlabs.
→ A business that grew £400k → £1m → £1.7m in its first three years and exited for tens of millions.
Armoo applies the test live. Selling a brand help with Instagram now scores badly: the brand is only slightly bad at it, in-house staff already run it, so the gap is small and so is the fee. Selling a brand help to build and own a YouTube channel scores well, because most brands genuinely do not know where to start — a wide gap and a higher price. He and Abdaal agree the marketing-on-YouTube gap is largely closed, but the owned-and-operated channel gap is still open, tempered by YouTube's slower time-to-payoff.
→ A concrete go/no-go read on two adjacent services in the same channel.
Common mistakes
Starting a social media agency in 2026
Armoo actively tells people not to: the tidal wave came from brands not understanding social, and most now do. The category label is not the opportunity — the remaining gap inside it is.
Going broad to keep the market big
A generalist offer shrinks the perceived gap for every buyer. Naming a specific audience you uniquely understand raises the value of the same service.
Ignoring how long the payoff takes
A wide gap with a distant payoff still sells badly, because it requires patience from the brand and the creator. Buyers pay astronomically more for the same result delivered fast.
From the transcript
“correlated to the Gap and the gap between where they are and where they're trying to be yeah so if for example you come in…”
“so I think it's always important if you're thinking about you know like business and where should I play that you want to think about…”
“I don't think it makes sense at the moment to start a social media agency um I think that the kind of tidal wave has…”
From the episode
From Council Estate To Selling A Global Business For Millions At 27 - Timothy Armoo Founder of Fanbytes
Timothy Armoo