The Best Problems to Solve
In my current role at Microsoft, I work with incubation teams across the company. Probably the coolest job ever. My role? Do whatever needs to be done to help them get off the ground in the earliest of early stages.
Tactically, I do a lot of research about customers and markets. A big part of that is understanding the problems that people are facing. By understanding problems, entrepreneurs can create valuable solutions that people will buy.
Well, in my experience, turns out there are ALOT of problems out there. One of the tough parts, is figuring out which you should solve. Which is the most severe? Which am I uniquely positioned or qualified to address? Which has the biggest opportunity?
My approach usually involves a mix of research and intuition that flows through a divergent and convergent rollercoaster. Oh, and there’s usually a bunch of spreadsheets involved, prioritizing problems against customer, business, and technology variables.
Kevin Hale entrepreneur and partner at Y Combinator explains his process for evaluating problems in this video. It’s always stuck with me, and has helped me through the problems problem. 😜
As an investor, he says he looks for startups that solve a problem. But not just any problem, a problem with these characteristics:
Popular (a lot of people have this problem)
- Ideal – 1 million +
Growing (more and more people will be having the problem)
- Ideal – growing at 20% per year
Urgent (need to be solved quickly)
- Ideal – immediately
Expensive (if you solve it you can make more money)
- Ideal – $1B+ revenue potential
Mandatory (people must solve this problem)
- Ideal – a recent law or regulatory change that makes this required now
Frequent (problems that reoccur)
- Ideal – daily or hourly
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