Bullet points on evaluating startup ideas
- Places where people have a big passion already but the economic models doesn't make sense.
- It's hard to keep living in the future. The minds wants to rest in the present. Inspiration comes in bursts.
- To get intuition on a certain topic, you need first to learn the rules upon which that field is based to then forget them.
- When you know that you can build it better, take the leap of faith if it won't happen without you.
- The most rewarding thing about my job is that I never have to work very hard to explain why I love it.
- Work on a super hard problem that no-one else is working on.
- If you have to use someone else's name or authority to get your point across, there is little merit to the point (you might not believe in it yourself). If you believe in something to be correct, focus on showing your work to prove it. Authority derives naturally from merit, not the other way around.
- A platform is composable if its existing resources can be used as building blocks and programmed into higher order applications.
- If you mix two hard problems you get an impossible problem.
- MVP as a wedge into the market and then leverage that into a much larger opportunity.
- Timestamp the vision.
- Predict something non-obvious about the future of the world before other see it & make it market ready for their ultimate vision.
- Too many companies are money driven, end up making less money. Be positive impact driven.
Analyse and idea
- If with a new technology:
- Can only be done this way.
- Take full advantage of the new technology/benefits.
- Motivation around the topic.
- Potential of the idea.
- Knowledge around the core technology.
- Capacity to attract top talent with the idea.
- Profit potential.
- Probability of success.
- Every felt the problem.
- Do you like who the customer is.
- Can we have product led growth.
On life's intrinsic motivations by David Pink
- Autonomy → the urge to direct one's life.
- Mastery → the desire to get better at something that matters.
- Purpose → the yearning to do work in the service of something larger than one's self.
On how to begin
- Where am I now.
- The very next step forward.
- The goal/dream.
How to find a problem
- Reformulate as a question → bite off a partial solutions off of it.
- Bring something inaccessible to the masses.
- Find the problem intolerable & feel like there must be a way to solve it.
How to find something people want
- Something people use that's broken.
- Turn luxury into a commodity.
- Look at what big companies should be doing and then do it.
Zero to one - Thiel
Doing what we know how to do takes the world from 1 → n.
College can teach you many things many don't know what to do with those skills.
What important truth do very few people agree with you? Many people believe in X, but the truth is Y. What companies is no-one building.
How do we go about developing the developed world.
Two types of progress: horizontal (1 to n) or vertical (0 to 1)
- Horizontal is focused on copying things that work and improving them
- Vertical is focused on breaking new ground
Most common case of failure is when people don't get along. Far more than external competition.
“Competition can make people hallucinate opportunities where none exist”
Build + maintain a monopoly
- Monopolists lie to protect their monopolies — they inflate the size of markets in which they compete seem larger, to deflect attention; “everyone is competing with us” (Google has a monopoly on search and search advertising, but talks about being a broader technology player)
- Non-monopolists tell the opposite lie — ”we’re in a league of our own”; understating the true scale of real competition
Capitalism and competition are opposites
- Capitalism generates profits
- Competition eliminates profits
Definite vs. Indefinite / Optimism vs. Pessimism — a great 2x2 matrix for thinking about mindsets for innovators
How to develop a good idea? Know a secret about your market. How to develop a secret:
- Know the tools better than anyone else
- Know the problems better than anyone else
- Draw from your own experience background
Get an understanding about something where other people do not yet have. The secret at PayPal they were very interested in cryptocurrencies and encryption technologies and currencies and could they be intersected. Can you build a new digital currency.
Go after big markets that are growing a lot and capture as much of it as possible - one example of this is clean tech companies, where in the first slide they show a huge market- which will of course come with a lot of initial competition.
What are the things that can be done in London better than anywhere else in the world.
The advantages of Silicon Valley, like network effects, also have disadvantages like more Lemming liked and crowd like behaviour which can also be problematic.
work on a problem that otherwise would not get solved. an important problem where people have a blind spot around it or aren't thinking about it. Foundation about it - passion about, and physiological level - something that a lot of people is missing one way or another.
A bad plan is always better no plan.
The future has to be thought in concrete terms and has to be different from the present. Only with these two the future can have a carismatic force. Based on western Europe there're 3 possible futures on offer:
- Islamic Shari'ha: woman's have to wear a burka
- totalitarian AI a-la China: computer track you
- hyper environmentalism where you drive an e-scooter and you recycle.
Where is the frontier? Where are the pockets of innovation where you can do some new things and not be in a craze competition? What's a good career that other people aren't pursuing ? -e.g. petroleum engineer-
The most important things you need to have a secret.
In an industry with a lot of incumbents, a lot money, one has to have a projection of the future that nobody else agrees with that turns out to be insightful.
You need to be able to track future accurately. Otherwise you give generic advice and that's something that most people ignore.
Most people hedge
You must be looking where everyone else isn't. Otherwise there will be tons of competition and it'll be very hard to differentiate.
What do you know that's true that nobody else understands.
Tech startups are inherently a global business, so they must do one thing uniquely well, better than anyone else in the world.
What great business exists that nobody else is building.
Sometimes companies are iterations on things with one fundamental improvement in one key dimention.
Looked at the present, where the internet was, and thought about the obvious opportunity this was going to be. No rocket science, no genius. Seeing the truth when everyone is laughing and having math to prove it.
Next company, x.com (Paypal) -> putting your financial information on the internet. Trust your reasoning from first principles.
Reason from axioms vs reason by analogy. In the important moments in life you should reason from first principles.
See where it's going because he could see where it was that day. Conventional wisdom is still a few years later.
If this could b done, this would have been done along time ago -> a math that you believe in. See reality, asses probabilities, ignore the rest/noise.
- Saw web usage growing 2300% YoY.
- Made a list of the top 20 products to sell online & picked the one that could only happen online.
For any infant technology -> Anything that can be done using traditional methods should probably be done that way.
You best theories are going to be creating guesses, not simple speculations.
Airbnb, Coinbase, Stripe
- Timing was important:
- Preexisting product.
- Preexisting competitor.
- 10x Better Product Possible.
- Most founders and investors thought these ideas were terrible (either too hard to execute or plain bad ideas).
- Each opportunity turned out to be bigger than what the founders expected.
GDP percentage of the west is in decline:
- Influence and capability to defend itself will also decline (although people will probably not notice this).
- Capability of states to crack down on civilians will increase -> people will try to look for alternatives.
The west focusing more on equality rather than in excellence. Focus in defending universal values of: 1. Freedom of speech. 2. Free markets. 3. Protection from search & seizure.
- What problem are you solving?
- Can you state the problem clearly
- Have you experienced it yourself?
- Can you define your problem narrowly?
- Is your problem solvable?
- Who’s your customer?
- How intense is the problem?
- Are they willing to pay?
- how easy are they to find? (The customers)
- Does your MVP actually solve the problem?
- Which customers should you go after first?
- Which customers should you run away from?
- Should you discount or start with a super low price?
- How to setup metrics
- GA + something else (Amplitude, Mixpanel)
- Pick 5-10 important stats
- Make measurements a part of a product spec
- Product Development Cycle
- KPI Goal