The single most common piece of advice I’ve heard about startups is to make sure that you’re solving a real, meaningful problem for someone. It’s easy to think of something cool but useless; much more valuable to think of something mundane but genuinely impactful.
This is good advice. But the problem is, it’s really hard to understand. What counts as a true problem to be solved?
Sometimes, it’s easy to answer questions like these by putting together a clear framework for the offending word – “problem”, in this case – and defining it very precisely. This is my preferred approach to problem solving – I studied physics in school, so my instinct is to try to express everything in terms of clear, atomic building blocks and strict, mathematical relationships between those building blocks.
Sadly, advice is the sort of slippery thing which doesn’t behave according to nice physical laws. So, despite all the questions I asked my mentors in an attempt to follow this advice, I didn’t really understand what exactly was being said, and why.
The way I finally began to understand this advice was iterative. Each week, when writing a daily update to my co-founder, I found myself saying something like “last week I didn’t appreciate what it meant to have a clear problem we’re solving, but now we finally have one and I get it.”
No, I didn’t mistype there. I said that each week, about the previous week.
It took me about 10 iterations before I finally didn’t have a breakthrough the next week. Or the next, or the next. Which means either I finally got the advice, or I hit a wall I’m not clever or experienced enough to comprehend.
I’m going to write this post assuming it was the former. Here’s a rough description of the iterations I went through – hopefully seeing my process laid out will help you to absorb this advice more easily!
Week 0: The “Enlightened”
“Heuristics like that are nice, but we’re doing something fundamentally unique! It’s not about what problem we solve, it’s about how revolutionary we are!”
Issue: No it’s not.
Week 1: The Moron
“Of course we’re solving a problem! The problem is that people want to pay us their money for our product or service, and they can’t!”
Issue: Nobody wants to pay anyone anything. They want jobs done or services provided. If you can’t name what value you’re delivering, you can’t have confidence that your customers will buy what you’re selling.
Week 2: The Relativist
“We’re solving a problem, because there are currently tools out there which are bad at doing what we do well. So we solve the problem of those tools being bad, by being better.”
Issue: This fails to ask whether anyone actually values whether or not these tools are good at the thing our product beats them at.
Week 3: The Show-Off
“Sure, we’re solving a problem. We let people do a cool new thing! Something never-before-possible! They’ve clearly always wanted to but lacked the capacity, so that’s the problem we solve.”
Issue: Again, this fails to confront the question of whether anyone would be willing to pay for your new capability.
Week 4: The Swapper
“People are paying for that thing over there! That’s basically analogous to our thing, it’s just that they’re different in this one key way where ours has to do with sound and theirs has to do with images. But how much of a difference could that possibly make?”
Issue: Without understanding the problem which the existing problem is solving, you can’t know whether your product will find a similar fit.
Week 5: The Anecdote
“I talked to a bunch of people and they all said they definitely would be willing to pay for this! What? Oh, I mean, they want it for a bunch of reasons, it’s just great and cool!”
Issue: You’re lying. You talked to three friends and maybe a sibling. Not good enough.
Week 6: The Statistician
“OK, I actually went out and conducted a poll and sat down with a bunch of different people this time. On average, they’d be willing to spend $10 for this product.”
Issue: First of all, people don’t know their willingness to spend money until you put a product in front of them and ask them to pay. Secondly, you still don’t understand why they want this, which means you’re not likely to capture all the value you could and probably will lose to a knockoff made by someone from Harvard who actually understands business.
Week 7: The Storyteller
“I went back and talked to all the people from my survey to understand what they’re looking for. They have a couple of different reasons to be interested, but the biggest one is this one. I believe this is real because everyone has tried to build our product to solve it for themselves, but my advantage is that we’re building tech that was never possible before so we have a unique starting point and defensive moat.”
Issue: This is starting to sound plausible! Your biggest issue here is that all you’ve proven is that there’s interest in your product, but you haven’t really proven you understand why that’s a problem, which means you’ll struggle to sell effectively and charge as much as your product is worth.
Week 8: The CFO
“This is definitely a real problem for our customer. I can tie it directly to their bottom line – by selling this product, we’ll increase user retention, decrease cost of goods, and open a whole new merchandising option – all in ways that mean massive profit.”
Issue: This is great progress – but the problem is that, while businesses are driven by money, individuals aren’t. You need to be able to tell a story that’s not just compelling for the company generically, but for the individual you’re trying to get on board.
Week 9: The Politician
“…and at this company, Dave is one of three BizDev VPs but he has an audio background so he’ll be super interested in what we’re working on. He’s currently trying to get a new game approved but like always budgets are tight so he needs a magic bullet to convince his execs that the game will be able to pay for itself. Our product offers a new monetization option that he can directly incorporate into his pitch – and it’s cool enough that he can demo it for the execs to help sell them on the overall vision!”
Issue: Don’t for a second think your work is done! The landscape is ever-shifting, your product is always evolving, and needs will change. But you’re off to a solid start!