How do you pick the right idea?
I've spent a lot of time thinking about this. I've started multiple companies and pivoted countless times. Last year, I took some time off to reflect deeply on what to work on next. Recently, I started a new company and chose an idea I'm truly proud of.
I wanted to share the lessons that impacted me while they were still fresh.
1. Pick something you want.
The easiest way to pick a good idea is to pick something you want. If you want it, there's a good chance others will, too, and you'll understand exactly what to build. This is how many iconic companies started.
The best way to come up with startup ideas is to ask yourself the question: what do you wish someone would make for you?
— Paul Graham
The very best startup ideas tend to have three things in common: they're something the founders themselves want, that they themselves can build, and that few others realize are worth doing. Microsoft, Apple, Yahoo, Google, and Facebook all began this way.
— Paul Graham
In the great tradition of startups, we started Apple because we wanted the product ourselves. There is 1 person or 2 people who are both the creator and the market so that they know the marketing requirements intuitively because they're the market themselves. They can have the engineering-marketing meeting in their head and arrive at what the product ought to be.
— Steve Jobs
2. Solve a problem.
No pain, no gain. If there's no problem, there's no opportunity. Don't chase ideas. Notice real problems and solve them.
The way to get startup ideas is not to try to think of startup ideas. It's to look for ("notice") problems, preferably problems you have yourself.
— Paul Graham
You start a company because there's a very important problem to solve that's not getting solved.
— Peter Thiel
The reason I started Tesla is because i think it's important to accelerate the adoption of electric vehicles.
— Elon Musk
I always say, "Make sure you're actually solving a problem." Now there are different ways that can be wrong. It can be solved already, really well, in which case you're not solving a problem. The idea might be great, but you're not solving a problem. It can be a really neat idea with not a lot of people that need that problem to be solved, in which case, it's not really a problem for the world. Maybe we could broaden this by saying, Solve a problem for the world.
— Kevin Systrom
3. Pick a large market.
In hindsight, this might be the simplest and most important advice: Don't pick an idea. Pick a market, ideally one that's large, growing, and that you're part of.
"Notice I don't talk about the idea. I think ideas are almost irrelevant… The more important thing is that you pick a large space that you're knowledgeable and passionate about. And then you will figure out what the right thing to do within that space is."
— Naval
The only only advice I have about trying to start something big is pick pick a market where it seems like there's some version of the future where it could be big if it works but other than that it's like one dumb foot in front of the other for a long time.
— Sam Altman
As I look for patterns in successful startups, the more I believe the market, inclusive of timing, is more important than the initial startup idea. People get so enamored with the idea — even putting it up on a pedestal as the be-all-end-all — that they don't step back and spend enough time assessing the market. … Take any famous entrepreneur. I bet they picked a great market (and timing!), found an opening in the market (an initial idea), and then built a suite of offerings to service that market over many years.
— David Cummings
We have always focused on the market. The size of the market, the dynamics of the market, the nature of competition because our objective was to build big companies. If you don't attack a big market it's highly unlikely you're ever going to build a big company.
— Don Valentine
Most people think first of what they want to express or make, then find the audience for their idea. You must work the opposite angle, thinking first of the public. You need to keep your focus on their changing needs, the trends that are washing through them. Beginning with their demand, you create the appropriate supply.
— 50 Cent via Sama
An entrepreneur's job is to have a hypothesis on what a good market is going to be.
— Chris Dixon
4. Be obsessed.
Startups are impossibly difficult. To succeed, you need to be obsessed to persevere through all the difficult things you must do to make it work. If you're not obsessed, don't do it.
I'm convinced that about half of what separates the successful entrepreneurs from the non-successful ones is pure perseverance. It is so hard. You pour so much of your life into this thing, and there are such rough moments in time that most people give up. I don't blame them. It's really tough, and it consumes your life. I mean, if you've got a family and you're in the early days of a company, I can't imagine how one could do it. I'm sure it's been done, but it's rough because it's pretty much an 18-hour-a-day job, 7 days a week for a while. So unless you have a lot of passion about this, you're not going to survive. You're going to give it up." … "You've got to have an idea or a problem or a wrong that you want to right that you're passionate about. Otherwise, you're not going to have the perseverance to stick it through. And I think that's half the battle right there.
— Steve Jobs
I came up with 40 new business ideas—everything from creating software to setting up hospital chains, since my wife's father is a doctor and has a hospital. Then I had about 25 success measures that I used to decide which idea to pursue. One success measure was that I should fall in love with a particular business for the next 50 years at least. Very often, people get excited for the first few years, and then, after they see the reality, they get tired of the business. I wanted to choose one that I would feel more and more excited about as the years passed.
— Masayoshi Son
I don't like mercenaries, and I don't like mercenary cultures. The missionary is building the product, building the service, because they love the customer, because they love the product, because they love the service. The mercenary is building the product or the service so that they can flip the company and make money. One of the great paradoxes of entrepreneurship is that the missionaries usually end up making more money than the mercenaries anyways.
— Jeff Bezos
5. Be different.
Thanks to AI, it's easier than ever to create—making it harder than ever to stand out. In a world full of noise, don't pick a better idea; pick one that's different.
Tolstoy opens Anna Karenina by observing: "All happy families are alike; each unhappy family is unhappy in its own way." Business is the opposite. All happy companies are different: each one earns a monopoly by solving a unique problem. All failed companies are the same: they failed to escape competition.
Focus on being different rather than better. "I've learned over time that you need to have differentiation. A lot of storytelling is about differentiation. Why are you different than anybody else? You don't want to compete head-to-head. You want to tell the story about why your company is unique. I think sometimes we forget that. We just talk about why we're better than the competition.
— Alfred Lin
6. Be narrow.
There's no focus that's too narrow to start. The best startups begin by serving laughably small groups of people. As my friend Shane Mac says, "Think smaller to go bigger."
Focus on the smallest possible problem you could solve. There's a resistance to focusing from a fear of being trivial. If you get to be #1 in your category, but your category is too small, then you can broaden your scope. Focusing on a small niche has many advantages.
— Ev Williams
Better to make a few users love you than a lot ambivalent. Ideally you want to make large numbers of users love you, but you can't expect to hit that right away. Initially you have to choose between satisfying all the needs of a subset of potential users, or satisfying a subset of the needs of all potential users. Take the first. It's easier to expand userwise than satisfactionwise.
— Paul Graham
I would definitely advise a small startup company to be as narrow and as focused as is possible to be. If you look at the original Amazon business plan, there was no hint of anything other than books in it… I wanted to build an online bookstore, and that was it. But the online bookstore worked better than they thought it would. So Amazon launched music, and that worked better than they thought. Then video, and that worked too. So Jeff sent an email to customers: "I picked about 1,000 customers and I said, besides the things we sell today - books, music, and video - what would you like to see us sell? And the list came back incredibly long-tailed… So it's been kind of one foot in front of the other.
— Jeff Bezos
7. Be you.
Play the hand you're dealt, not the one you wish you had. Pick an idea you're uniquely positioned to solve—one that your entire life has led up to working on.
You want to look for the intersection of what you're good at, what you enjoy, where you can create value for the world. In my experience if you don't find something at the intersection of those three it's hard to really have impact. Most people just fall into what they work and don't give it much thought. Its worth upfront thought about what you're going to send most of your waking time doing.
— Sam Altman
In my opinion, the best predictor of whether a startup will achieve product/market fit is whether there is what David Lee calls "founder/market fit". Founder/market fit means the founders have a deep understanding of the market they are entering, and are people who "personify their product, business and ultimately their company.
— Chris Dixon
Understand you are one of a kind. Your character traits are a kind of chemical mix that will never be repeated in history. There are ideas unique to you, a spell of rhythm and perspective that are your strengths, not your weaknesses. You must not be afraid of your uniqueness and you must care less and less what people think of you.
Your time is limited, so don't waste it living someone else's life. Don't be trapped by dogma - which is living with the results of other people's thinking. Don't let the noise of other's opinions drown out your own inner voice. And most important, have the courage to follow your heart and intuition. They somehow already know what you truly want to become. Everything else is secondary.
— Steve Jobs
8. Be useful.
Pick an idea where you can be helpful to other people. That is the whole point of startups. Your success is determined by the number of people you help and how much you help them.
When one serves for the sake of service—for the satisfaction of doing that which one believes to be right—then money abundantly takes care of itself. … Concretely, what I most realized about business in that year-and I have been learning more each year without finding it necessary to change my first conclusions-is this: 1. That finance is given a place ahead of work and therefore tends to kill the work and destroy the fundamental of service. 2. That thinking first of money instead of work brings on fear of failure and this fear blocks every avenue of business-it makes a man afraid of competition, of changing his methods, or of doing anything which might change his condition. 3. That the way is clear for any one who thinks first of service-of doing the work in the best possible way.
— Henry Ford
Whatever the thing is that you're trying to create what would be the utility delta compared to the current state of the art times how many people it would effect. Having something that makes a big difference but effects small to moderate number of people is great as is something that makes even a small difference but effects a vast number of people. The area under the curve would be roughly similar for those two things. So it's really about trying to be useful.
— Elon Musk
How strange is the lot of us mortals! Each of us is here for a brief sojourn; for what purpose he knows not, though he sometimes thinks he senses it. But without deeper reflection one knows from daily life that one exists for other people — first of all for those upon whose smiles and well-being our own happiness is wholly dependent, and then for the many, unknown to us, to whose destinies we are bound by the ties of sympathy. A hundred times every day I remind myself that my inner and outer life are based on the labors of other men, living and dead, and that I must exert myself in order to give in the same measure as I have received and am still receiving. … A man's value to the community depends primarily on how far his feelings, thoughts, and actions are directed towards promoting the good of his fellows.
— Albert Einstein
9. Think in first principles.
Don't think in analogies by picking an idea that is "X for Y" or because someone says, "A is hard and B is easier." Instead, think in first principles and choose an idea based on fundamentals—an important problem for a clear customer in a growing market that you're born to solve.
The paradox of teaching entrepreneurship is that such a formula (for innovation) cannot exist; because every innovation is new and unique, no authority can prescribe in concrete terms how to be more innovative. Indeed, the single most powerful pattern I have noticed is that successful people find value in unexpected places, and they do this by thinking about business from first principles instead of formulas.
It's mentally easier to reason by analogy rather than first principles. But first principles is kind of a physics way of looking at the world…what that really means is that you boil things down to the most fundamental truths…and then reason up from there…that takes a lot more mental energy.
— Elon Musk
10. Live in the future.
Good ideas are gaps in the world, and it's hard to see them if you don't live in the future. Live in the future by using the newest technology, spending time with smart people, and observing what's missing that you wish existed.
Paul Buchheit says that people at the leading edge of a rapidly changing field "live in the future." Combine that with Pirsig and you get: "Live in the future, then build what's missing." That describes the way many if not most of the biggest startups got started. Neither Apple nor Yahoo nor Google nor Facebook were even supposed to be companies at first. They grew out of things their founders built because there seemed a gap in the world.
— Paul Graham
An inflection is an event that creates the potential for radical change in how people think, feel and act. An insights is a non-obvious truth about how one or more inflections can be harnessed to radically change human capacities and behaviors. If you have an insight your initial idea doesn't have to be right.
11. Bet with conviction.
Pick an idea you believe in so deeply that you'd bet everything on it—even if no one else thinks it's a good idea yet. If you don't feel a "hell yes," then it's a no.
We said okay they're going to try a lot of things and we've just got to pick one and really concentrate and that's how we can we can win here. Most of the world still does not understand the value of like a fairly extreme level of conviction on one bet. That's why I'm so excited for startups right now it is because the world is still sleeping on all this to such an astonishing degree.
— Sam Altman
And here is the prime condition of success, the great secret-concentrate your energy, thought and capital exclusively upon the business in which you are engaged. Having begun on one line, resolve to fight it out on that line, to lead in it, adopt every improvement, have the best machinery, and know the most about it. The concerns which fail are those which have scattered their capital, which means that they have scattered their brains also. They have investments in this, or that, or the other, here, there and everywhere. "Don't put all your eggs in one basket" is all wrong. I tell you "put all your eggs in one basket, and then watch that basket." Look round you and take notice; men who do that do not often fail. It is easy to watch and carry the one basket. It is trying to carry too many baskets that breaks most eggs in this country.
— Andrew Carnegie
The first thing I heard when I got in the business, not from my mentor, was bulls make money, bears make money, and pigs get slaughtered. I'm here to tell you I was a pig. And I strongly believe the only way to make long-term returns in our business that are superior is by being a pig. I think diversification and all the stuff they're teaching at business school today is probably the most misguided concept everywhere. And if you look at all the great investors that are as different as Warren Buffett, Carl Icahn, Ken Langone, they tend to be very, very concentrated bets. They see something, they bet it, and they bet the ranch on it. And that's kind of the way my philosophy evolved, which was if you see – only maybe one or two times a year do you see something that really, really excites you… The mistake I'd say 98% of money managers and individuals make is they feel like they got to be playing in a bunch of stuff. And if you really see it, put all your eggs in one basket and then watch the basket very carefully.
12. Choose good quests.
Startups are hard, and life is short. If you're going to spend the best years of your life working on one, pick an idea that matters—one that leaves the world better than you found it.
What's your quest? Quests tend to manifest as an objective we center our lives around. Your quest might be to reach a specific milestone: to become a senator, to publish a book, to make a million dollars. But not all quests have an end state. You might be on a quest to maximize your net worth, or to bench-press more weight than anyone else at the gym. Maybe you're just on a quest to have the most fun possible before you die. A far cry from refrigeration or running water, but a nice life. As you've probably already intuited, not all quests are created equal. In the most simple terms possible: a good quest makes the future better than our world today, while a bad quest doesn't improve the world much at all, or even makes it worse.
13. Take your time.
A successful startup takes years. It's better to spend an extra month choosing the right idea than to waste years on the wrong one. Don't rush the pick.
If you want to do great work, you must work on important problems. Great scientists made time to carefully think about the most important problems. Average scientists spent almost all of their time working without carefully considering the importance of problems.
Picking the right thing to work on is the most important element of productivity and usually almost ignored. How do you think about it more? Leave enough time in my schedule to think about what to work on. Reading books, hanging out with interesting people, and spending time in nature.
I am willing to take as much time as needed between projects to find my next thing. But I always want it to be a project that, if successful, will make the rest of my career look like a footnote.