So, you want to be a startup founder. But how do you find an idea worth doing?
Despite what startup formation myths say, many founders decided they wanted to be founders and then went in search of a product or problem. It is a much more common pattern than you normally see in the media. In retrospect, there is a lot of pressure to polish the story, make it simpler and more compelling. Often what actually happens is a bit more complicated or maybe more self-directed than you hear. For whatever reason people don’t want to admit they decided to start a company first and then had ideas. Perhaps it sounds too mercenary and not “authentic” enough.
I mention this because there are techniques to generate and identify startup ideas. In two of my startups, first was the decision to start a company and then a very intentional search for the right market and problem to solve.
Here’s a list of some of the common patterns in how people generate startup ideas (or really any new business idea). You can generate using these methods and then evaluate against criteria like fit with team expertise, passion for the problem, size of the market, fundability, expected gross margin, or others.
- Become an Expert – Dive deep into the subject area that you have an interest in. Once you are an expert, you may be able to solve problems that everyone knows about and thereby create a business. Or if you pay attention, as you approach the subject with a beginner’s mind you will have questions and insights about the assumptions inherent in the way things are done. You will have fundamental questions that if you can capture them may lead to new approaches and insights allowing you to create a new product. That product could become a business.
- Live in the Future – Become an early adopter of technology or new ways of living. If you can experience the problems others will have ahead of them, you will find an idea with a growing market as others start to have the same technology. (“Live in the future, then build what’s missing.” – Paul Graham)
- Find a Co-Founder or Advisor – Find an advisor or co-founder who can brainstorm with you and/or help you evaluate the ideas. If you do not know them well or have not established a high level of trust, you may want to have an explicit conversation about idea ownership.
- Starting a Passion Project – Experiment or tinker with a project that you think is interesting. If you discover something that others find valuable, too, you may have a business. (“Live in the future and build what seems interesting” – Paul Graham)
- Look for Problems You Have – Develop the habit of noticing what problems you personally have and writing them down. Consider how you could turn to solve the problem for people like you into a business. (BTW, the common use of this venture pattern is one of the reasons that startups are sometimes criticized for too often only scratching the itch of only the types of people who are typically starting companies.)
- Look at Your Super Power – What is the thing that you are best at or know the most about? Focus on deepening that and noticing startup ideas that match that strength. Investors and customers may be more likely to trust you if the company’s mission/product has some alignment with your strengths.
- Focus on Non-Customers – Practice looking for the spaces not currently served by markets or companies today. Or as summarized for the Blue Ocean Strategy: simultaneously pursue “differentiation and low cost to open up a new market space and create new demand” (See book Blue Ocean Strategy).
- Brainstorm for Quantity – Research on innovation shows that often those with the most successful ideas are often the people with the most ideas. So, keep a list and keep adding! Don’t make anyone too precious and don’t get attached early. For example, complete X for Y grids. Or studying brainstorming techniques.
- Study Venture Patterns – If you become familiar with the mental models used in product and business model design in startups, you may be able to combine ideas in new ways. Steven Johnson notes in his book Where Good Ideas Come From that the combination of ideas is often a source of innovation. (You don’t have to read this blog to learn about venture patterns, but that’s cool, too.)
- Try to Sell It – If you have a general area you’d like to focus on or the beginning of a product idea, try to sell it to friendly potential customers under the premise of getting feedback or advice. Make the sale process gradually more real by asking for them to pay and see what feedback you get. Careful not to take every comment literally as some people will be kind and others won’t be able to say what they want. Sometimes you may find that the idea you are selling is adjacent to what customers really need and will buy.
- “Get Out of the Building” / Interviews – Talk to potential customers in your market to develop customer empathy and look for recurring patterns or problems. (For more on Interviews or Sell It, read Talking to Humans, Four Stages of Epiphany or Disciplined Entrepreneurship.)
- Find a Small Group Who Will Pay – “You can either build something a large number of people want a small amount or something a small number of people want a large amount. Choose the latter. Not all ideas of that type are good startup ideas, but nearly all good startup ideas are of that type.”- Paul Graham
- Read the Lists – YCombinator has a Request for Startups List which they have updated at least once. Another YC list by alumni is here.
- Find a Co-Founder with an Idea – If you have technical skills or an execution orientation but do not have an idea currently, find a co-founder who has an idea and is looking for teammates. Schools, founder speed dating, other startup events can all be places to look. Also, letting your friends, co-workers, and former teammates know you are looking can be helpful, too. For example, Arash Ferdowsi famously co-founded Dropbox when he met fellow MIT student Drew Houston who had an idea.
- Work for a Startup – put off the notion of having a startup idea right now. Instead, work for a high-potential startup where you will meet people who may become co-founders.
Further reading and sources:
- How to Get Startup Ideas by Paul Graham
- Book: Four Steps to the Epiphany by Steve Blank (Summary)
- Book: Disciplined Entrepreneurship by Bill Aulet
- Book: Blue Ocean Strategy by Chan Kim & Renée Mauborgne (Summary)
- Book: Talking to Humans by Giff Constable
- Guide to Developing Startup Ideas by Founder Institute
- YCombinator has a Request for Startups List
- Products I Wish Existed by Elad Gil
- “Is your startup idea taken?” — and why we love X for Y startups
- Startups I Want to Fund by Andrew Lee
- Startup Themes for 2020 by Dan Gross