Paul Graham: How to Find an Idea for a Startup (Part One)

Recently, an article by Paul Graham about finding ideas for a startup was published. Graeme is itself a cult person in Silicon Valley and this is why it is worthy of attention. But in my opinion, this article is one of the best of its kind. Yes, lazy isn’t writing about Customer Development and Lean Startup now, but she is distinguished by Grem’s deep internal philosophy and summarizes his rich experience as the founder of YCombinator, who communicates with thousands of startups a year.
The article is very long, so I took the liberty of breaking it into 5 parts so as not to tire anyone. Let's go: The

best way to find an idea for a startup is not to think about it. Find a problem, and better if you have it yourself.


The best startup ideas have 3 things in common: there is something that the founders themselves need; they themselves can create it; and only to a few other people does this seem worthy of realization. Microsoft, Apple, Yahoo, Google, Facebook - all went this way.

Problems

Why is it so important to work on a problem that you yourself have? One reason is to make sure that the problem really exists. It sounds obvious that you only need to work on problems that really exist. Nevertheless, this is the most common mistake startups make - to solve a problem that no one has.

I did it myself. In 1995, he launched a project designed to bring all art galleries online. But the art business doesn’t work like that. So why did I spend 6 months working on this idiotic idea? Because it ignored users. I invented a model of the world that did not correspond to reality, and worked on the basis of it. And I did not notice that the model was wrong until I tried to convince users to pay for what we developed. Even after that, it took a long time until I realized everything. I was so attached to my model of the world and spent so much time developing software that users were required to want it!

So why are so many founders building projects that no one needs? Because they start by trying to come up with an idea for a startup. This way of thinking is doubly dangerous: it will not only not bring any good ideas, it will give rise to bad ideas that seem plausible enough to be deceived and begin to work on them.

At YC (YCombinator) we call them "fictitious" or "sitcoms." Imagine someone from the television series decides to start a startup. The screenwriter would have to come up with something. But coming up with a good startup idea is hard. This is not what can be done upon request. Therefore, the scriptwriter will propose an idea that will sound believable, but actually will be bad.

For example, a social network for pet owners. She does not seem unconditionally mistaken. Millions have a pet. Often they take great care of them and spend a lot of money on them. Of course, many of the owners would like to have a site to communicate with other owners. Probably not all of them, but if 2-3 percent of them constantly visited the site, you could have millions of users. You could show them targeted ads and possibly offer some premium features.

The danger of such an idea is that if you interview your friends with pets, they will never say that they will never use this service. They will say: “Yes, I can imagine using something like that.” Even when a startup starts, it will sound believable to many people. They themselves do not want to use it, at least right now, but they can imagine that other people are using it. Aggregate this reaction among the entire population and as a result get zero users.

Well

When a startup starts, there must be at least a few users who really need what you are doing. And not just people who perhaps see themselves someday using your service, but who do not need it right now. Usually this initial user group is small. The reason is simple: if this group, which urgently needs something, was large and this something could be built by the forces that startups usually need to develop the first version, it would probably already exist. Thus, you need to sacrifice something: you can build something for a large audience that does not really need it; or for a small audience that really needs it. Choose the second! Not all ideas of this type are good startup ideas, but almost all good startup ideas are of this kind.

Imagine a graph where the X axis represents the number of people who want your product and the Y axis represents how much they want. If you mirror the Y axis relative to the X axis, you can imagine the company in the form of holes. Google will be a huge crater: hundreds of millions of people use it and they really need it. A newborn startup should not expect to dig a pit of such a volume. Thus, you have two options regarding the shape of the hole you start with: either you dig a wide, but flat hole; either narrow but deep as a well.

Contrived startup ideas are usually of the first type. Many people are moderately interested in a social network for pet owners.

Almost all good startup ideas are of the second type. Microsoft was a well when Altair Basic was doing. There were only a few thousand users, but without it they would have to program in machine language. 30 years later, Facebook had the same figure. Their first site was only for Harvard students, for only a few thousand, but these users really wanted this site.

If you have an idea for a startup, ask yourself: who needs it right now? Who needs it so badly that he will even use the ugly first version of the product, made by a two-person startup he never heard of? If you do not have an answer, perhaps you have a bad idea.

But you do not need the narrowness of the well in itself. You need its depth. Narrowness is obtained as a byproduct of optimizing depth (and speed). And you - narrowness - almost always get it. In practice, the relationship between depth and width is so strong that it is always a good signal when you know that an idea strongly attracts a certain group or type of users.

And although demand in the form of a well is almost a prerequisite for a good startup idea, it is not enough. If Mark Zuckerberg had built something that only Harvard students would like, it would not be a good startup idea. Facebook was a good idea because it launched in a small market while there was a quick way out. Colleges are fairly similar in the sense that if you built a facebook that suits Harvard, it will fit any other college. So that you can spread the idea quickly among all colleges. Once you have all college students, you will get everyone else just by putting them into the system.

Same thing with Microsoft: Basic for Altair; Basic for other computers; languages ​​other than Basic; operating system; software; IPO

Continuation(part two) follows tomorrow. Just right to digest and / or sleep with thoughts.