Great post by John Battelle about one of my current favourite web apps, Furl.

I love the concept of “nano-businesses” like Furl. That my phrase for incredibly small companies (one or two people plus free agents added to the mix when needed) that meet a VERY particular need, and do so with little or no capital involved.

These companies can either be continuing sources of decent income for their creators, or (as appears to be the case with Furl), a way to give birth to a feature that is missing from some larger application.

Assume you find that a big, valuable product is missing some key functionality that you’ve dreamed up. If you can keep development costs incredibly low and launch it almost as a proof of concept online, it becomes very simple for BigCo product owner to do the math and decide to buy the technology off you for a modest (to them) but also huge (to you) amount.

This makes sense in a way that wacky dotcoms during the bubble didn’t. Back then the same concept was tried, but invariably there was venture money behind the “company that should be a feature”. That fact alone seems to swell payroll and call for huge marketing budgets which end up making the feature too rich to be bought and everyone loses.

Now you can use open standards and the blog/feed/technorati/google ecosystem to build and promote these things cheap, cheap, cheap. Expect more of these all the time.

(Other examples? I say Technorati, Feedster, Blogrolling, del.icio.us, and any other company trying to make money off feeds. Oh and LinkedIn, Friendster, and all YASNS.)