Stop starting companies just to start a company.
It’s no surprise that from the outside, people see running a startup as a glamorous job of fame and riches. An infatuation for wanting to live a similar, contrived fantasy builds up in many and before you know it, they are dropping out of school, brainstorming the next big idea on their brand new whiteboard…
Wait a second…you’ve already set yourself up for failure.
What I’ve experienced over the last few years is that more and more folks are obsessed with starting a company without experiencing the true problem they are trying to solve and without setting their expectations appropriately to what starting and running a company really entails. How many times have you heard someone say, “man , I just came up with the best idea ever!” Yup, it must be a great idea and it must be the next billion dollar company, go for it!…
The courage and bravado is great but reason cannot be thrown out the door.
Truth is, the vast majority of ideas we come up are absolutely awful. If you’re truly an innovative thinker, you’ll have a thousand more in just few days - not to worry. With that said, these random ideas always seem like the next big thing when we are honeymooning with the initial concept. However, sitting around brainstorming an idea for a company or product is not how a company is created. You don’t brainstorm the next big idea. I’m not at all suggesting that one should stop coming up with ideas. It’s just important to have a system to filter those ideas so that you set yourself up for true success.
The best products and ideas come from experiencing a deep problem over and over again. Then, you start hearing multiple people around you asking for or wondering if a solution exists for that very problem. The latter is your cue to explore the idea, not drop everything and go for it. You can’t force an idea! It will show.
Fundamentally, the most remarkable companies are created by people who are building a product to reconcile a problem they are solving for themselves. A problem they are intimately familiar with, having experienced it in all of its various permutations time and time again.
Finding the right idea to build a company around is something that just happens. Creating the company should not be your goal (which is what it is for many) but a tool to solve the problem you are experiencing.
The right problem is a problem that consumes you and legitimately keeps you up at night because you are so incredibly pissed off at how hard it is making your life. You start to notice it more and more. It isn’t just any problem…it’s the one that stands out among all of the other problems you encounter day to day.
Too many ‘entrepreneurs’ are infatuated with the idea of starting a company for the sake of starting a company, forcing them to brainstorm a new product or idea that they feel is ‘truly innovative and disruptive’ over the course of a few hours around a whiteboard. That’s just not going to work.
Unfortunately, there are investors out there who will fund ‘whiteboard ideas’…instead, they need to look for and fund authenticity instead.
Don’t get me wrong, I’m all for more startups tearing it up and creating competition, diversity and talent in the ecosystem. But it has to happen naturally. Otherwise, we end up creating a synthetic ecosystem filled with hipster-founders, that is bound to collapse at some point. It can lead to even deeper issues like valuation hikes, unsophisticated investors, all of which hurt the longterm ecosystem.
This shift is concerning. An example that makes me nervous is Y Combinator’s new program where you can apply to YC without having an idea (http://ycombinator.com/noidea.html). Wait…what? Isn’t the process of naturally experiencing a massive problem, validating it is a problem, exploring possible solutions all pieces of the puzzle that prove someone is perhaps ready to be a founder? I thought that was a necessary trial by fire. Granted, I don’t know much about that program, so maybe I am entirely wrong here. But I just can’t get myself to agree with the following quote about the program:
“A good startup idea is simply a significant, fixable unmet need, and most smart people are at least unconsciously aware of several of those. They just don’t know it. And we now have lots of practice helping founders see the startup ideas they already have.”
Refinement of an idea is helpful (YC is great at helping with that) but I believe the problem the founder wants to solve needs to be evident in the founder - consuming the founder, felt in his/her bones & guts. Otherwise, it isn’t enough of an issue for the founder.
Everyone experiences problems - no secret there. So, you can have people help you identify and list them out and then think about which one might turn into a biz. However, to me, if you don’t know the problem you want to work on then I don’t think it is a big enough issue for you and not big enough that you should start a company around it.
I’m not entirely sure if this problem of creating companies for the sake of creating a company will self-regulate in a few years as the synthetic companies eventually fail. Or, do we need champions to actually push a change? Does it come from the investors being a bit more reclusive or just better and more readily available education around starting proper businesses?
I guess we’ll see.