A novel solution to an important problem

From Jason’s “Pump” Carpenter and the grain binder (The Roots of Progress):

Whatever form it takes, we should recognize and value direction-setting as a crucial role in driving progress.

This has been on my mind ever since I saw another hiker’s shirt a few weeks ago: “Corporate agenda: Off. Innovation: on”.

There are countless stories of clueless management getting in the way, and I’ve certainly had my share of bad bosses — most of them, honestly, as technology largely fails to celebrate or train great managers. “Why can’t those damned executives just leave us alone”, the thinking goes, “so we can get on with it and get something done?”

There is something to be said for getting out of the way; the people closest often do know best. And coming from a more buttoned-up corporate environment, the level of autonomy good software companies afford can be a bit disorienting. I went the other way, spending summer 2005 as a Microsoft intern, then back into a more traditional Chicago office environment where, I learned, it was not ok to wear shorts to work, or leave without getting permission from my manager.

But the real test isn’t criticizing others, it’s how you run it when it’s your shop — your charge, the buck stopping with you. And so I came to appreciate direction-setting, part of the larger skillset of leadership, which means getting people motivated, but also, picking the right goal to pursue.

So, if your goal is to succeed in a technology venture, how do you find the way?

Pick an important problem

It helps to start with an important problem.

In fact, this is the #1 thing I’d tell new engineer-entrepreneurs to obsess over, for it largely defines the company. Certainly more than the distribution and the technology, maybe even as much as the people.

In engineering, the test is solving the problem well, whatever it may be. Commercial success goes one step further; solve the problem well, but also, solve the right problem. In a free market, you’re only compensated insofar as other people are willing to pay for your output. So you have to pick carefully. In practice, this means looking for something where:

• At least one person urgently wants something you can provide, and
• There are a lot of other people that have the same problem.

Paul Graham compares it to a hole in the ground: it has to run deep (lots of individual pain), but also, cover a lot of area (lots of people).

One path to important problems is reducing pain — the core of Amy Hoy’s “Painstorming” approach. It’s incomplete, for sure; Painstorming won’t lead to Coach, Disney, or Facebook, anchored on quintessentially human things like joy, laughter, and the quest for status. But between climate, taxes, or 100 other things, “reducing pain” has a long way to go. There’s a lot of meat left on the bone, so to speak.

Novelty

Once you’ve found an important problem, and some way to solve it, the immediate next question is: why hasn’t someone done this already? If you can’t think of a good reason, it likely either (a) already exists, or (b) isn’t an important problem.

Good reasons:

• You’re early: You’ve worked/studied at the leading edge of a fast-changing technology (e.g. robotics) and are first to identify how something new could be applied to an existing problem (this seems most common for very large markets)
• You’re a mutant: You have specialized knowledge of 2, even 3 different things (cultures, regulatory domains, hobbies) and your solution requires deep understanding of all of them
• Access: You have some kind of access — suppliers, credentials, etc. that isn’t easily copied.

I’ve had a lot of ideas where “nobody thought of it” actually meant I was late, it had already been tried, and nobody wanted it. Depressing, but true.

Sales and marketing are becoming more important to software, and perhaps something that would fail due to poor marketing, could succeed if it was done better. I can’t think of an example offhand, but with the growing distribution complexity of software, it seems more likely today than five years ago.

Start with the customer

Bill Aulet in Disciplined Entrepreneurship:

The necessary and sufficient condition for a business is a paying customer.

In my view, this points to the way out. Before you build anything, find a specific individual and chat with them. Not a class of people, but one person. Figure out whether the problem is important, whether they care, and whether the thing you’re building is good enough.

In conclusion, when considering problems, add these columns to your spreadsheet:

• How much pain does it cause?
• What are people doing now?
• How much better is what I’m doing?

In short, a startup is a novel solution to an important problem.

And be sure to read 57 startup lessons, Disciplined Entrepreneurship, and How to Get Startup Ideas for more perspectives on this.