Idea Generation
blog.samaltman.com
blog.samaltman.com
As a one-time founder, I feel embarrassed to have to ask this; but in the spirit of no-stupid-question and also that there's gotta be someone else wondering the same -- which one is the real trend and which one is the fake trend?
By way of interpreting sentences in a normal way, I would assume "used a lot by a small number of people" is the real trend and "used a little by a lot of people" is the fake trend (going by order of mentions in both sentences).
However, I struggle with this a bit. Dapps were used a lot by a small number of people as of a few years ago (think the cryptokitties trend), but it didn't exactly pan out as a real trend IMO. In other cases, yes, when early adopters love a product and use it a lot, that tends to become a real trend. On the other hand, Facebook apps in 2008 (when they were smaller apps like Superwall and such, before games took over) were somewhat "used a little by a lot of people" at the beginning. I think it wasn't until games took over where the "used a lot" (by a large number of people in that case) really took off.
For some more context, the How to Start a Startup course is pretty good -- here is the lecture I think is most relevant: http://startupclass.samaltman.com/courses/lec06/
Any statement like this isn't going to apply in all cases, and you bring up some good examples. But it's a good general principle.
If yes, it would be nice to see it together with such statements, to back them, because I have the feeling most of this is just anecdotical or ideas introduced by some kind of start-up gurus...
However, as others have pointed out, this was originally observed by pg and has become a staple of YC’s advice since then. I think it would be uncharitable to say this is just a hypothetical invented by startup gurus. YC has had a lot of startups pass through their doors, and more experience than almost anyone seeing why people succeed or fail. Their findings may not exactly be science, but I think their advice is as close as we can get right now.
The "used a little by a lot" people don't have the attachment or deep need to work through issues and they give up after some time. They also can't be bothered to evangelize for you.
Of course, sometimes there is no market beyond the small group. Even then, it is easier to make a business (revenue > cost) in the small "used a lot" market than the other case where people won't pay.
True story, DEC included a free mail program with VMS because some developer wrote it. And they were baffled when companies started ordering VAXes mainly to use for email.
Web was similar in 1993. Very few users, yet folks like Adam Curry left his job as a famous “VJ” at MTV to start a website, buying the unused domain mtv.com for the purpose (you can guess how that turned out). I mention this because he was a total norm who got enamored with the web when almost nobody used it.
And Bitcoin, well...
For actual numbers, here’s a graph of computer users since 1980:
https://pbs.twimg.com/media/EZI1TsJXYAAo9ES?format=jpg&name=...
Interview with Reid Hoffman, founder of LinkedIn, Altman goes more into his reasoning [0]
https://mastersofscale.com/sam-altman-why-customer-love-is-a...
Obviously 'love' implies more attachment and longevity of subscription, but a million x even just once is still 10,000 hundred xs.
But maybe that's just my 'if I started a company I wouldn't be thrilled at the thought of taking VC money' perspective talking.
Maybe LinkedIn works because it’s used a lot by the small group that matters and pays – recruiters! I imagine they’re on LinkedIn all day long.
On one hand, Sam's point is basically described by Paul Graham's essay on "Narrow and Deep" ideas [1]. You want an idea to have a few passionate users rather than lots of lukewarm users, because there's an activation energy to building a habit and if you're only lukewarm you're not going to get over it. As PG put it, "Sum that reaction over a whole population, and you have no users."
On the other hand, you have Geoffrey Moore's "Crossing the Chasm" [2]. This has the critical observation that early adopter & mainstream populations are different. About 10% of the population has an early-adopter mindset: they will try anything because it's new and cool. Those are the people Sam says you should be hanging out with in this article. But your experience with them doesn't generalize, because most people don't think like that. Most people are self-interested and have short attention spans: if it doesn't deliver clear value to them with minimal hassle, they aren't interested.
The set of world-changing products really exists in the intersection of these two worldviews. Products that had lots of passionate early adopters but failed to cross the chasm include Lisp, LiveJournal, RSS, VR (both times), and cryptocurrency. Products that aimed for too mainstream a market and only had lukewarm users include WebTV, grocery delivery, and smartwatches. In between are products like the iPhone, where the PDA market had been sitting in early-adopter limbo since 1991 but technological changes finally made it practical, or YouTube, where streaming video had been in early-adopter limbo since RealAudio in 1997 (?) but cell-phone video, Flash, and easy web uploads made it practical in 2005.
I think that we lose a lot from a mentality that isn't adaptive, that prescribes in advance whether something is going to become popular or not. Because then something that is currently a niche gets killed off before it finds the mass market. I feel like whenever I find something new I like in the supermarket it disappears a short time later, presumably because of greedy optimization.
I think the USA implementation is poor not the idea is bad. Here Finland K-ryhmä[1] did really nailed implementation and it is like 10x better than going to the supermarket. My mom and aunt both in their 70 started using this separately and both are saying they are not going to back in supermarkets after covid19.
After having gone through CSAs, our various decent grocers, and then realizing there were “no” retail fishmongers, a friend had recommended Good Eggs and we’ve never gone back. It’s not for everyone, as it’s basically only the priciest things you’d find at Whole Foods, but it’s also delivered to your door and without a large-scale grocery chain in between.
Covid-19 has obviously strained their availability, but overall they’ve still been amazing.
(Yes I know about Dreamwidth, I also miss having my friends all there and getting them writing essays again when Twitter is so tempting is an uphill climb.)
I wouldn't say that only pre-chasm matters, though. VCs usually refuse to invest in startups that have zero chance of crossing the chasm. The prototypical example of this is say an app for D&D players. You could have the most passionate userbase, and the app could be critical to their experience, but your total addressable market maxes out at the 13.7M D&D players worldwide and it's unlikely they'd spend more than say $10 each on it, which makes it unattractive to all but the smallest VC firms.
Interesting way to judge those who don't hop on every new fad. Maybe they have a longer attention span and are filtering out the noise. They don't get caught in new gadgets and apps because they may be pursuing something larger scale in their life, like building stability for their family or studying deep for college or helping out the local community or training for athletic performance or whatever.
Its only in the start-up bubble that someone who is not an early adopter of Uber or Airbnb or Dropbox or whatever "huge" thing is seen as just selfish and ignorant.
Seen from a wider perspective, yeah these apps have significance but not that much in the daily lives of people. Yeah now I sometimes book my vacation through the airbnb app, instead of booking a hostel or hotel, but it doesn't radically change my vacationing habits. Sometimes I call an Uber instead of a taxi. Has upsides and downsides but it's not some new age of mankind.
Perspective, people.
Killer examples include any products or services which would provide a net positive value to society but are currently outlawed within various geographic territories for superstitious reasons and/or to protect existing industries from competition.
Prediction markets are an excellent example here: a substantial body of research now indicates that 1) prediction markets are superior to all other strategies in predicting any quantifiable event (because they are “meta tools” which inherently incorporate the best information from all strategies) and 2) non-private markets can’t be used for manipulating elections, sponsoring assassinations, or incentivizing real-world action of any sort. (In any prediction market with a public order book, any attempted “action-incentivizing position” can be consumed by arbitrage until all that remains is a measure of the event’s real probability). For several decades, researchers from dozens of universities have lobbied for relaxing the ban on prediction markets in USA, with little progress to show. Until that ban is lifted (which could take decades longer), blockchain-based prediction markets will have no domestic competition.
Also worth noting: even in the presence of legal, centralized prediction markets, decentralized prediction market protocols may still be competitive because they require far less counterparty-risk, allowing them to safely support higher volumes and larger positions.
Source(s) for this?
I know prediction markets will have far-reaching consequences when they aren’t or can’t be constrained anymore.
The mere presence of a payout for low-probability is a broad change. Maybe I’m not being paid to kill someone via the market directly, but I am naturally incentivized to collect information about the world, gain power, and then use my power to bet on and make low-probability events happen.
Another question - How do we solve the decentralized oracle problem without relying on decentralized votes that could be biased due to past voting behavior or their vested interest in the outcome of a truth vote?
> Some worry that censorship-resistant prediction markets will be used to encourage assassinations (and other crimes); this concern does not hold up to a sober examination. “Assassination markets” (AMs), as originally proposed by Jim Bell, are irreconcilably different from Prediction Markets (PMs). My experimental method for funding public goods with PMs has features which render it incompatible with crime. Furthermore, markets would generally present an excessively-complex, risky, and convoluted form of criminal financing. Truthcoin presents a (peaceful) alternative for accomplishing ideological goals, which features greater persuasiveness as well as lower cost. I conclude with a short discussion covering [1] recourse for those affected by AMs (of any kind), [2] features of Truthcoin designed to amplify the inherent impracticalities of AMs, and [3] the (necessarily relevant) total net effect of Truthcoin on political assassinations, general crime and general human welfare.
The linked paper does a thorough job of explaining this scenario, but to summarize: yes, in the absence of other market participants you might try to bet on low-probability events and make them happen. But because it's a public market, anyone can see the anomalous "predictions" you have made, and "free ride" on or even "front run" your position, including your accomplices (who can also sabotage you). On net, your position will be mostly consumed by arbitrage, your payout will be inconsequential compared to the capital required, and the probability "returned" by the market will remain accurate.
They've been used mostly for questionable purposes (largely exploiting oracle attacks on poorly-written DEXes), but there's something very interesting about completely removing capital availability from the constraints on a market participant. It means any arbitrage opportunity can be exploited by anyone, regardless of how much it needs to be levered up to be worthwhile, and so basically democratizes financial profiteering.
I found that statement ambiguous as well. For a while I wondered if he meant to imply either of those cases can be a differentiator.
Genuine question, were they? I've yet to see any data on the FREQUENCY of usage of these dApps. There was certainly a lot of buzz.
As is usual with these kinds of YC posts, a lot of clarifying detail is handwaved away in the name of expediency and clarity of expression. "used a lot by a small number of people, or used a little by a lot of people." -- what a great heuristic! And certainly not useless.
But it doesn't help you figure out that learning how to figure out that difference when the entities are not at rest but in motion is the whole challenge and art in the first place. Sadly, I guess this is a good way for you to answer your question. Nobody outside of an early adopter ever had a practical usage for a Dapp, which is how you know the idea is a solution in search of a problem.
I think a good idea moves on two different coordinates around usage patterns (actually more, but two in the context of users):
a) the idea has some value before the network effect
b) the idea has value even for those users that don't contribute any data
and yeah that rules out most low hanging fruit social network, but yeah, social network aren't about ideas, are about how much marketing you can push behind them anyway.
I always look at that like a soldier jacked up on adrenaline wearing an arsenal of ammunition ready to destroy the enemy having forgotten to ask who the enemy is or where they are. Lost. Maybe if they just start spraying ammo at everybody the enemy will suddenly make themselves known and something will stick.
This entire scenario is completely at odds with Indie Hackers who continually stress to refine a good idea until you have both revenue and product/market fit before quitting your day job. This advise is well suited to people who have the reality of personal finances and time constraints, so I guess there are some people who have unlimited funding and time to burn in search of something they should already have.
Regardless of whether you are a founder or not, figuring out the important problems to solve is important to ones career.
That's also the reason why one should make a prototype very fast and validate by a potential user/customer that you solve the problem the right way.
God knows that much of that attitude is often lauded on HN for other things.
I am entering my fifth military deployment so I can speak to the nature of spontaneously formed teams of strangers. Intelligence is largely, but not completely, irrelevant. You learn to identify that a team is strongest due to a mix of good discipline and putting the proper personalities in the correct positions and then codifying a single common purpose. I recommend reading the book Good To Great for further examination.
What's the alternative? To wait for tectonic shifts in overall environment and circumstances, look for vacant ecological niches and pounce when you see one. To the outside view this will look exactly like a founder who doesn't know what to start up.
Here is an example I like: John Carmack. The conventional view is that he is a brilliant game programmer (which is undoubtedly true). But the alternative point of view is that his shtick was to capitalize on the period of incredible advances in consumer hardware. Each of his games fully showcased what the best hardware of that time was capable of (order of magnitude more than the previous generation) which made them instant hits. Not coincidentally, he quit making games around the time this period of advancement stopped.
Here is a post by @defmacro making a similar point: http://www.defmacro.org/2015/02/25/startup-ideas.html
> The problem with this way of thinking is that existing markets are probably efficient enough
Oh, that's certainly not true. The challenge there is the expertise to see the current dysfunction versus the risk of solving for it. Solving for the dysfunction often comes at competition for the limited resources required for current practice of art and rejection from just about everybody. Knowing this there is a choice to be made:
1. Sustain the current practice with current income and no change in risk
2. Proceed with the solution knowing that failure is probable and that a startup begins with a financial valley of death (burns cash without the revenue to make up for it) while knowing the greatness of the idea is financially irrelevant.
I say the greatness of the idea is financially irrelevant, because disruption requires some degree of originality and originality scares the shit out of people. That means the idea will burn money churning in frequent rejection until it achieves some manner of market assistance.
The point is that they could have all this, but without them capitalizing on the incredible wave of rising hardware performance we wouldn't be talking about them now. Big opportunities arise when the situation is dynamic.
> > The problem with this way of thinking is that existing markets are probably efficient enough > Oh, that's certainly not true. The challenge there is the expertise to see the current dysfunction versus the risk of solving for it.
Notice that I didn't state that there is no dysfunction, only that there are no easy opportunities to exploit it. The reality is that the world is full of dysfunctions but they persist not because people are lazy to fix them, but because our systems are stuck in the bad equilibria which are hard to get out of. Take healthcare for example. To anyone who went to a doctor even once the dysfunction is obvious. The system can probably be made 10x more efficient with fairly simple tweaks! But good luck implementing them - you will be stuck in the molasses created by regulation, incumbents and simple inertia of people unwilling to experiment with their health.
That is about the most American way of putting it.
It also describes America in the middle East and lots of Africa. Weapons had to be sold and/or money had to be made. So people were attacked and when people started shooting back, suddenly there was a reason to invade.
I currently focus on providing services to ecommerce companies, and I get to hear all the time about their pain points and things they wish they had. It's given me a lot of ideas for products to work on and the bonus to that is I already have established relationships with my market, making it much easier to iterate, build case studies, and sell.
A lot of the demographic on HN is engineers. That is an industry. You can start with asking your engineer friends and colleagues what painful engineering problems they face, why nothing they use is good enough, and what they wish they had to fix it. If you find enough people saying the same thing, then you've found a potential market. And luckily engineers are early adopter too.
The problem with this is that the recent grads with effectively no practical experience to speak of can't start startups with VC funding and dreams of grandeur this way. But I agree that this is the best path to start a company that's actually likely to succeed based on actual long-term profitability and legitimate problem solving.
But it doesn’t feed into the Silicon Valley career mill. So it doesn’t get talked about.
SV’s assumption is that you want to “get signed” and start your path. Acquihire by acquihire you build a career. Some outliers get rich and motivate the others.
The whole thing is a self-sustaining finance market. Failed founders provide the workforce, outliers provide the funds. And the mill keeps turning.
(the real winners are GPs and LPs, the VCs are just as much hamster wheel runners as the rest of us, just later in the career)
We were a no-idea company in the S12 batch. We ended up starting Streem [1], which was acquired by Box in 2014 [2] and ended up integrating and becoming Box Drive [3]. While we didn't build an enduring company, I'd say it was a moderate success by some metrics.
YC had two no-ideas in S12 and another one or two in W13 before they shut the track down. Unclear if that's enough data to spot a trend, but YC is smart and likely had other data to back up the decision. Looking back, it was a painful process to go from "no idea" to what eventually became Streem. I don't think I'd ever go and decide to start another company without an idea in the future.
[1] https://lifehacker.com/streem-offers-unlimited-cloud-storage...
[2] https://venturebeat.com/2014/06/16/box-acquires-streem-so-yo...
For example Reddit's original team wanted to do a "My Mobile Menu", and also Aaron Swartz pivoted from Infogami to merging with Reddit.
I would almost count this partially under the "no idea" category.
I think YC expects most companies to modify what they are doing during the program.
But all of these things are very different to taking someone on board with no idea at all.
Borrowing from epidemiology, I think "no ideas" might be an effect modifier. That is, it is just an intermediate step when going from the exposing factor to the outcome (the outcome, we know, is failing start-ups). It would be interesting to know what the real proximal cause is, or at least a really good proxy for it.
Maybe YCombinator could benefit from the input of a biostatistician or similar statistical expert to design some cohort studies on start ups.
I am confident that if I were required to make a dedicated effort to 'develop a startup idea' that was absent life experience, success would require more good fortune than if it were coming from a synthesis of experiences, observations and innovative thought.
YC already did an experiment, as Sam notes, that points to the need for some type of fertile idea space that gains nutrients from ones life experience. I've had a bunch of ideas, each more or less fleshed out, and some actually acted on. I stumbled on all of them because I was trying to solve a problem that I had personally experienced.
What you need is a goal and a vision for an improvement to something that people want. Take any current service, and try to figure out what metric people are really using to evaluate it.
Now think about what it would take to 10x that metric. I'm stressing the really because that's where you have to do some folk anthropology and try to understand what people really want.
If you think people eat food to maximize calories, providing them with 10x calories would sound like a good thing, but that's probably not what's happening. Maybe what you want to figure out is how to have 10x calories / dollar.
But people don't just eat food for calories, they also eat it for the nutrient mix. What would be the perfect nutrient mix? Does it need to be custom? Can it be done at a good cost? (that's kind of what Soylent has been doing)
Food is also one way we experience some of the most varied sensations: can you make something that's both incredibly nutritious, and that expands people's palates?
Food is also built around social experiences, how can you improve the social experience of cooking and eating together? What's the metric? What does 10x that metric look like?
Can you 10x along those 3 axes at the same time? Are there trade offs? Can you overcome them?
I'm just using food as it's an obvious need/want everyone recognizes (low on the Maslow pyramid).
But that can apply to literally anything, as long as you dig deep enough to figure out the underlying need/desire/want.
And that way you can quit trying to find random "ideas" based on trends that are just at the surface of things.
Jeff Bezos (and a bunch of other people) said it before: don't try to think of what's going to change, think about what's not going to change. People's desires are one of the most stable thing you can build on. Figure out that bit and you'll find a bottomless well of ideas.
How many people did they try this with? Most startups fail, so it will be interesting to see whether they funded enough of these. I think there's a rule of thumb about the upper limit on a probability that isn't observed, but I can't remember what it is.
As for generating ideas, the founders I've come across have tended to know some industry well enough to understand some of the problems. Often this is very specific industry stuff, including understanding which experts are needed and what customers to focus on.
Of course there's plenty of people who have grown up in some industry, but I think the other ingredient you need is enough general knowledge about business to be able to put some pieces together: how to get funding, what a corporate structure is, how to do certain mundane things like pay taxes. The intersection can be smaller than you think, because a lot of corporate types are comfortable where they are, plus they feel (rightly or not) that the job is providing a fair bit of the business infrastructure they need to use their expertise.
I hear this expressed quite a lot and there's certainly some truth here. I think it can be quite misleading though.
Many good ideas also just sound like pretty good ideas and turn out to be great businesses. Not every idea has to be completely crazy sounding. Perhaps this is even more true in B2B software / boring industries.
VCs and Accelerators are incentivised to encourage the craziest "moonshots" because that's how they make money. If you're just looking to get rich selling software you don't need to go to mars.
It is quite easy to be in an environment of smart people thanks to the internet. By thinking deeply about a problem or ten, trying to write a clear essay on it helps with this.
That seems like the buried lede in the blog post.
I don't know Sam or have any window into his motivations, but he seems to be (at least obliquely) addressing the current HN debate about whether fully remote is equivalent in efficacy to in-person for creative work.
Without taking a stance in that cat fight, he is making the (IMO sensible) argument that creativity requires a particular type of human environment, regardless of whether that is remote or not, and social isolation from your professional peers isn't such an environment. Of course, he goes further to suggest that a creativity-fostering environment requires a particular kind of professional peer group.
There's of course a balance to be struck depending on the idea's scope and urgency. Both may change with refinement.
Idea generation is both a learned skill and intrinsic to a person's circumstance and psychology. Ample unstructured time, low amounts of stress, and an affinity for day dreaming tend to help. Over time you grow to actually enjoy deep thinking as recreation.
I've noticed whenever I'm focused on a particular idea, it kind of forms a lens that shapes my world view. Anything I then encounter I view as a puzzle piece, which my mind attempts to reconcile into the larger puzzle that is the foremost idea in my mind at the time. It's a very similar dynamic to PG's musings on the subject.[0]
Agreed.This is why execution is more important than idea. Why? Because most ideas aren't born great. They evolve and progress. That's part of execution. The process of taking a good idea and make it great.
It's true that ideas tend to dramatically evolve as a result of execution. Likewise execution affords an opportunity for refinement that simply isn't there prior. I'd argue it's a different kind of refinement though from what you get while you're still in the green field stage.
Thinking and research on their own—over the course of a very long period of time—offer insight that isn't easily gleaned under the high-stress environment of execution. A different kind of insight or refinement, if you will.
It's worth noting that there are entire professions where the majority of what they do is think. Physics and philosophy come to mind. Why thinking is valued so little in tech by contrast, I don't know.
As mentioned, the idea isn't static. The idea is more of a process. And processes are driven by (quality of) execution, and team.
I'm not dismissing the value of idea. But it's generally over-valued. You'll do better starting with a good idea and making it better than you will waiting for a great idea.
Reason is that you work very closely with companies, often many different in the same sector, and get to see all the various aspects, quirks, and flaws at nearly every level of operation. Just the act of getting exposed to all this, can work as a great catalyst for ideas and brainstorming - much better (imo) than just sitting around and trying to think up something, where one can easily fall for the "solution looking for a problem" trap.
Now, unfortunately, most people can't just walk into those jobs - and you're not there to brainstorm solutions for every flaw you see. But if you ever get the chance to be in such a position, do try it out.
A lot of profitable entrepreneurship revolves around "boring" business problems.
You really can't come up with a better set up to an episode of Silicon Valley.
"I Want to start a start-up! But I have no idea what to start or how to start it. Can you tell me everything I should do?"
...coinbase was a 'no idea' startup
The retrospective view is somewhat illusionary. It's hard to capture what really happened att. I think a lot of the insight is in the first few paragraphs. Ideas in the "startup idea" sense, aren't one idea. They're a lot of ideas had over time. AirBnB couldn't have given their idea, like Tolkien couldn't have given middle earth to another writer.
Spotting trends is similarly hard, and similarly treacherous. Retrospective examples (eg mobile phones) seem way easier than they are.
One major pitfall for spotting trends is timelines. The whole 90s dotcom bubble, in hindsight, was mostly wrong about timelines. Browsers are important platforms, and controlling one does kind of make you "a microsoft." Moving early and grabbing market share is very important. Online markets do tend to be winner-take-all. They were just 10 years early.
Whenever I have a thought, I write it down. If I got that thought again, I might do a quick Google search and then give a rating to the idea. If I kept constantly thinking about it, I start researching it.
The research part might take maybe an hour a week. The other steps don't really take much time.
I find this to help with procrastination or losing focus.
I've always believed in swombat's quote on HN[1]:
>There's no such thing as an original idea. Every idea worth having has been had thousands of times already.
No point in keeping ideas private. Keeping them public lets other people build things I would like to see, even if I may not have the resources (time/energy/motivation/expertise) to actually do it. It's a win for me either way.
I am also working on an idea management platform, because I like Sheets but it is also a limiting experience. I'm making automated question-answer with TTS and speech recognition, and hoping to make automatic pitch deck starter kits from question-answer sessions in app. Maybe it'll be a product some day.
But our same day-dream happy brains are absolutely terrible at helping us execute on those ideas. Finding the most effective and efficient ways at making ideas come to fruition. And the millions of ways that an idea, no matter how great it may sound, may never come to pass.
This is a "how to day dream better" post. Which maybe some people need I suppose.
But I'd rather see a "how to make your dreams a reality" post.
This reminds me of David Heinemeier Hansson's talk at Startup School waaayyy back.
https://www.youtube.com/watch?v=0CDXJ6bMkMY
The gist: funders tell founders all the time to catch a wave. Go big or don't bother. The reason is that the funder must have a big payoff and small outcomes don't cut it.
But there's plenty of room for a small, well-run company with no aspirations of getting bigger. I believe the analogy was: best Italian Restaurant in the city.
The other advantage of thinking smaller than "huge" is that success is so much more likely because the competition tends to be less intense.
Maybe the author and I have a different idea of "huge," but the examples suggest otherwise.
If you're looking for a community that embraces the small startup idea and has developed a lot of material for exploring it, check out Microconf:
Just a few days ago I was reading an old thread on HN about "patio11's law" (The software economy is bigger than you think)
https://news.ycombinator.com/item?id=23162651
The comments are great and they talk about these non-venture companies that are quietly churning out 10s of millions or maybe 100s of millions of dollars.
Most things I would classify as "really great ideas" are emergent patterns in industries I know very well. Also, most of these are not abstract product ideas per se, you can usually see a direct and plausible path to generating large quantities of revenue and profit.
> Stay away from people who are world-weary and belittle your ambitions.
OK maybe that just is me.
People keep repeating that you should work on ideas that solve problems that you have yourself. Now given some time on your own, it's natural to start looking at your problems and seeing how to solve them for yourself and potentially others and make a profit along the way. If you want a sinister spin on this, nothing sells better than fear or hope.
But this is HN and as far as tech people go, our instinct is to solve problems that are given to us. And often when we have problems on our own, we come up with a solution and don't really think about it twice. I was recently talking with someone about a project they had at their work and how their company paid something like 3 million euros to another company to build a "platform" for them. And given that their company isn't that large or doesn't have that many users (say 40k/month tops), that raised my eyebrow a bit. So I asked them to show me what that "platform" was. Long story-short, a website with a username and password registration, email verification, paypal subscription, which allows you to download a list of PDF's.
To a developer the whole concept sounds like a joke - anyone with a few months of experience can mash that up in two weeks. "Oh but we have so many users and traffic, it's not that simple."
Bruh... 40k users/month, 100 pdf's, ~2mb each is something a raspberry pi can serve without any issues.
The truth is, most tech people are very much detached from reality(granted that the mass of people is the reality and not the other way around). We try to fix problems which we really don't have ourselves and we over-engineer the crap out of them. And commonly this is the result of the so called "idea generation". It's easy to create a startup that solves a niche problem. But we often fail to acknowledge how tiny these niches really are. It's easier to sell something that costs 10000 euros to 10 people and make 100k as opposed to selling something for 5 euros to 20000 people.
The truth is, most people create 5 euro products which have a potential audience of 10 people, hence the reason why they make 50 euros as opposed to 100k. You can scroll through PH for days and keep repeating "omg, who needs this?!?!?"
I know I have. And truthfully I doubt many people have hit the 50 euro mark, not to mention the 100k.
But people make that mistake all the time. We are surrounded by people who will hook up an led to an arduino which will blink when someone mentions them on slack while they are watching a movie, while ordinary people are looking at a website which has payments and they think that's quantum physics. Tech people and ordinary people live in parallel universes at this point. The ideas we come up with are solutions to problems no one has. That's the reason why SaaS is proving to be a lot more successful strategy than B2C.
My take on this is that every time you come up with an idea, don't bother sharing it with your tech friends first. In most cases you will get a 50-50 positive-negative response. Find people who are completely detached from your world and have no idea what the difference between a USB and RJ45 is.
1. Can you explain your idea in 4 sentences or less?
2. Do they understand it?
3. Do they have that problem?
3a(if Y on 3). Do they have a working solution, even if it takes 3 times the effort?
If the answers to those are:
1. No
2. No
3. No
3a. Yes
Then don't bother. You will almost certainly fail.
Before you take 3M euros project, you need to be invited to join the RFP / tendor, which is not available for everyone. It may take years to build up a reputation.
After you are invited, how long it takes to prepare the project proposal? It may take months or a year for pre-sales process. If you fail, your months of work are wasted. The client won't pay a dime for your prep time.
Even you win the project, how many changes did it take to reach UAT? If the project delays, you are losing time and money again.
How can you ask the customer to accept the UAT, which changed a lot from original scope of work due to lots of change requests? But the client will never say, Oh I am wrong, sorry, I am going to compensate you with big money.
Compared with product business, the order amount is indeed small, may be $20 / month. But I feel happy because I am no longer a slave of an enterprise begging for business all the time
Question - How do you discover the issues a business is having? Similar to the PDF issue that you describe above?
It’s much more important to find balance on your founding team than expecting to learn idea generation suddenly.
We need better tools for these different types to find each other. Creatives, executors, evangelists, etc can be different people.
I'm not sure this is as true as founders hope. Yes, startups take the lead when change occurs. But then they also take on all the risk, fight it out with similar startups, and a few years later often get purchased by one of the old incumbents. And in those purchases, some specific founders get rich, but many others fail, and many devs work quite hard and don't end up where they thought they would.
At the same time, the big incumbents get to just sit back and let other people fight it out, then re-buy their market share in the future.
Namely, people who went to an elite school (which inevitably implies they have rich parents) and aren't going to burden your fledgling cash grab with any world-weary ideas about integrity. Extra points if no one involved in the project has any programming talent. That frees up lots of time for coming up with brilliant ideas.
The rest is time and iteration.
Graham crackers with chocolate pre applied for making s’mores.
A racing league for bipedal robots.
If we permit meatware it might be ok.
- And have that murine sense of when to leave the sinking ship when this disregard backfires.
It seems that all reduces to find if you have some information asymmetry to take advantage of
So I've tried to learn to program to execute them myself, but that's a slow, long process, I'm an excellent Project Manager but a B- programmer, plus trying to wear every hat in a company is not exactly fun.
I've seen so much talent wasted on such poor ideas over the years, it's frankly unbelievable, and it never seems to change.
/endrant
There was MySpace before Facebook, 2nd mover advantage and all that.
What's that quote?
"Nothing is more common than unsuccessful men with talent. Unrewarded genius is almost a proverb."
Could start by setting up some kind of IoT auditing system.
An idea? Okay: Setup a software as a service Web site to solve quickly all traveling salesman problems with fewer than, say, 1 million cities, and everything equivalent in computational complexity to them.
First difficulty: To write the server side software, basically are asking for an algorithm that shows that P = NP, and now we have had some decades to conclude that so far no one knows how to do that (with a von Neumann computer, but maybe could get a solution using a quantum computer).
Well, for positive integer n <= 1 million, consider the traveling salesman problem on n cities. Without loss of generality, assume that n is a prime number (with factors only 1 and n). Then embed this problem in ..., and notice that ..., and then apply ..., exploiting special case ...! Right!!!
Lesson 1: This idea was super easy to find!
Lesson 2: What it takes to make this idea work is something new, and, if we get a solution, that would contradict the observation that there are no good new ideas because all the good ideas were thought of long ago.
Lesson 3: Finding an algorithm that shows that P = NP is challenging, but with that algorithm would have one heck of a strong technological barrier to entry and a contradiction to the claim that it is easy to copy a startup!
My real point: Have two lists. List A has the problems that plenty of people would pay big bucks to have solved. List B has the tools for solving problems. Pick a pair from lists A and B where the tool from B solves the problem from A.
Next, if there is no suitable tool in list B, then do some research and find one. If can't find a tool for the problem from A, then pick another problem from A and try again to do the research to find the needed tool.
The research need not be as challenging as proving that P = NP. But broadly one way to find "good ideas" is do some research that yields a tool that enables solving a problem from list A that has been sitting there for a long time unsolved due to the lack of a suitable tool from list B.
That is, one way to find a "good idea" is to do some research.
If we are restricting to having von Neumann computers do the data manipulations, then we can notice that the manipulations are necessarily mathematically something so that an enabling tool and the research are about forced to be in applied math.
It might also be sufficient to use some of the math on the shelves of the research libraries, math that so far has been neglected by the information startup culture.
Possible psychological issue: It may be that we frequently see good problems to solve but right away, within a few seconds, implicitly, maybe even unconsciously, reject solving the problem as a startup idea because we don't see a suitable tool for a solution. Well, then, slow down a little on the rejection step and consider some research or just what is already in the research libraries. Uh, there's a lot in the research libraries!