Most founders avoid fragmented industry sectors because they are often viewed as inefficient, chaotic, and difficult to scale a business in.
However, they also represent some of the largest untapped opportunities in the modern economy, as Rune Sovndahl recognized back in 2009, when he co-founded Fantastic Services and effectively reinvented the home services industry.
All that was done by turning the industry’s biggest weaknesses into a core advantage.
The Unique Challenges of Fragmented Industries
The first thing you have to understand about fragmented industries is that the usual rules of competition do not apply there.
The home services market is a clear example. It’s highly competitive, yet deeply inefficient. Thousands of providers operate independently within it, yet each offers similar services with little consistency, limited transparency, and no shared standards.
This makes it difficult for customers to choose a provider, as every step becomes friction. Booking is often guesswork, quotes vary, and availability is inconsistent. That’s why trust is hard to build and easy to lose, making it hard for businesses to scale.
Meanwhile, operators face different but equally limiting challenges.
Most are small and locally focused, relying heavily on word-of-mouth and manual processes. Growth is possible but difficult to sustain without compromising on quality. This is not only inefficient, but it doesn’t scale.
Rune realized the problem wasn’t demand or supply, it was structure. This is how he developed a business idea that would go on to reinvent the home services market.
What Good Leadership Means In a Fragmented Industry
Rune believes leadership is ultimately about solving problems profitably.
Reinventing the home services industry wasn’t about outcompeting the next small operator or running a better company inside the chaos, though. It was about recognizing the huge potential in the market as well and turning its perceived limits into a strategic advantage.
This idea first came to him when he saw firsthand the issues with booking a carpet-cleaning service online. He could not see a price or availability, so he had to call directly. Phones went unanswered, and ultimately, the details were wrong.
That’s when he had a breakthrough: what if you could design a business that delivers consistent, reliable value for everyone in the home service market?
So, he focused on building a system around fragmentation itself and developed a franchise model that soon became Fantastic Services.
The way Rune saw it, the home services industry already had a vast network of skilled operators, but what it lacked was coordination and a systemic approach.
The company brought independent operators as franchisees into a coordinated network so they still remained business owners while operating within a shared system of standards, processes and support.
Inside this network, they’d collaborate. Knowledge is shared, and best practices spread out quickly. Mistakes would then be corrected once, not thousands of times, which would save a lot of time and resources.
Outside the network, they would still compete, but now as part of a far stronger brand than any single operator could build alone.
Today, the business is a major London-based home services company, operating across international markets such as Australia and the US, with over 2,000 experts and 500+ franchise partners, serving tens of thousands of customers monthly.
The model has also survived three major crises–the 2009 banking crash, Brexit and the 2020 pandemic–and kept growing. This shows that well-designed systems don’t just enable scale, they make a business resilient.
In doing all this, Rune offers a practical blueprint for successful leadership in one of the most challenging types of industries.
Systems as the Foundation of Scale
One of Rune’s central ideas is that scale comes from good systems, not effort. As growth in a fragmented industry increases operational complexity, businesses risk declines in quality and efficiency without clear processes.
By building systems in every part of the business–from booking and scheduling to service delivery and follow-up–Fantastic Services reduces variability and increases its operational efficiency.
This is what enables consistent delivery at scale in an otherwise unpredictable market
Creating A Culture of Cooperation, Not Competition
Another core idea was to design a franchise model, so franchisees win when the system wins.
Naturally, a system like this only works if the incentives are aligned. Franchisees see clear value in participating: they have access to customers, strong brand recognition, operational support, and most importantly, they can rely on a proven system, designed around cooperation.
This was further reinforced through transparency, regular and open communication and genuine shared upside. The company’s standards are thus enforced because they make business sense, not because they are policed.
The core philosophy is collaboration between the franchisees, not competition. This creates stability, as individual success contributes to the success of the network as a whole.
Franchisees also share the best practices with each other and what works. This means that a breakthrough in one area becomes immediately available to everyone, turning speed of learning into a competitive advantage.
Technology Is An Amplifier, Not a Solution
Naturally, technology plays a critical part in enabling this model to work. It supports booking, scheduling, and customer communication. It also makes performance tracking easier, and most importantly, feedback collection and visibility.
However, Rune believes that technology alone is not the solution. While it allows the business to monitor performance, identify issues, and continuously refine operations, without a clear operational framework, it simply digitizes inefficiency.
That’s why creating a structured, well-thought-out system first is a must. Only after that can you begin integrating technology into it so it becomes the powerful tool for coordination and improvement that a company needs to set itself apart and gain a competitive edge.
Over-Centralization Is a Trap
The fastest way to kill momentum in a fragmented industry is to try to centralize everything. Over-centralization causes operators to lose ownership and some of their entrepreneurial drive. As a result, flexibility disappears, and the whole system slows down.
Rune avoided this trap with selective centralization. Specifically, the company standardized four things: customer experience, core service delivery, quality benchmarks, and brand presentation.
This way, local decision-making, hiring, market adaptation, and day-to-day operations all remain with the franchise partners. This keeps entrepreneurial energy alive and delivers the predictability that customers will pay for.
The model isn’t without trade-offs, of course. Standardization can still limit flexibility, and not every operator thrives in a system with shared rules. But in fragmented markets, the cost of independence is often stagnation. Finding the golden middle is also part of good leadership.
Trust is Hard-Earned And Easy To Lose
Trust is one of the biggest challenges in the home services market and fragmented industries as a whole.
Customers often approach providers in the home services market with skepticism, shaped by unpleasant past experiences, inconsistencies, and a lack of reliable information. This slows decision-making and increases friction.
Rune addressed these things by creating a unified brand backed by consistent standards, so customers would know exactly what to expect. This meant establishing clear booking processes, defined pricing, reliable service delivery, and visible feedback mechanisms.
These factors create consistency, which is precisely what builds trust with customers over time in an otherwise unpredictable market.
Final Words
Fragmented industries don’t lack opportunity; they lack structure. What Rune Sovndahl recognized early is that scale in these markets doesn’t come from competition, but from coordination.
With hundreds of franchisees, operations across multiple continents, and sustained growth through three major economic shocks, the model proves a broader point: structure scales where effort does not.
Good leadership is less about control, and more about designing systems in which others can succeed.
