The first step to marketing a small business would be to create a Corporate Identity (CI) for the business. This step has a cost implication but like most things in businesses it will pay off at the end of the day. My advice, don’t go too big. This step should come immediately after the registration […]
– Sam Altman. The Days Are Long But The Decades Are Short
Part of the hardest work of innovation, in any sphere, is original thought.
It isn’t building the product. (Which is pretty hard).
It isn’t the spending time with clients to understand, intimately, why they use your product like they do and what you need to do to make that product better. (Which is even harder).
It’s not even building the team or building the business. (Which is itself, really hard).
It’s coming to the first great idea that allows you to do all of those things.
Part of the reason that original thought is hard is because of the fact that – as people, we’re raised to find comfort in groups that are, in most ways, like ourselves. Doing something that may alienate us from that group is, understandably, a scary thing. Another reason, however, is due to the deeply ingrained mysticism around great ideas.
Starting from the time we’re young, most of us are silently conditioned to believe that truly brilliant ideas belong to a lucky few who are gifted with a rare breed of genius, and an insight that normal people just don’t have. Its easy to believe that Einstein or Zuckerberg could have a world shifting idea. But is it just as easy to believe that, that one guy who dropped out of school, wandered bare foot around India for a while and took a lot of psychedelic drugs could come up with an idea that’s going to shape the way people communicate for the next ten years or more?
Our inherent beliefs about this are normally based more on anecdotal evidence rather than hard fact. There are exceptions to this rule of course. As an example: Joel Spoksly, co-founder of Stack Overflow started his famous blog on the admittedly shaky claim that you don’t need a good idea to start a company. What you do need is good people who could make a difference.
Enter: Ed, Edd and Eddy, hatching yet another scheme to fund their ever expensive Jawbreakers habit (a quarter was a lot of money in those days). Ed is the brawn of the group. Edd (“Double D”) the brains. Eddy though? he ties it all together – he’s the leader. The original capitalist. The salesman. The deal maker. While Double D can put the specifics together, and Ed can handle all the heavy lifting, Eddy is the real brains behind the outfit. Eddy is the one who hatches the schemes. Eddy is the one who has the great ideas.
And where do Eddy’s great ideas come from? Who knows. They’re either already in motion before we arrive or, on those occasions where we do see their formative moments, they come as a flash of brilliance brought on by some seemingly inane or incomprehensible thing said by Ed or Double D. Eddy’s great ideas just seem to come to him.
Enter: Wile E. Coyote. A planner. A trapper. A predator looking for his next meal. Day after day, Coyote hatches yet another ill fated plan to catch the Roadrunner. A bird who’s abilities seem to include running through painted walls and generally defying the laws of physics. But where do Coyote’s ideas come from? Nowhere. They just seem to appear as a light bulb above his head.
The flashes of brilliance and the “light bulb moments” are easy for most of us to recognise. We’ve seen them, over and over, from the time we were old enough to watch cartoons. Though we’ve been learning, almost from birth, to recognise the markers of an idea, the tools required to form and validate those ideas haven’t been as well formed.
Enter: William Gates. Building a BASIC interpreter for the Altair 8800. Bill and his partners have seen something that other people don’t. Computer prices are falling. And they’re falling at such a rate that in the future, selling software on them is going to be a viable business. And that if they provide a BASIC interpreter, more people will be able to make software, meaning more people want to buy computers to make and use the software. Bill and his partners have the chance to create a market.
But where did this idea come from? It’s been a build up. Bill and his partner, Paul, have been working on computers for years. And by the time this opportunity came up, it wasn’t just a basic idea – they’d been in the industry for so long that they knew what was happening inside it.
Gates’ and Allen’s story is by now, a famous example of a tech company that went big. But you’ll note that I haven’t used the idea that they’re famous for, but rather the one that got them started. Which led to the one for which they’re famous (the Operating System deal that made Microsoft what it is today). The reason I’ve done this is to illustrate something – that ideas in the real world don’t flow the same way they do in the stories.
Tom and Jerry. Sergey Brin and Larry Page. Bugs Bunny. Mark Zuckerberg. The overwhelming tendency is not to talk about BackRub, but to jump straight to Google. To skip the part about the cat gaining advanced cognitive abilities – and skip to the great mouse trap.
I’m being a bit facetious of course, but the models we grow up with do not lend themselves to showing something fundamental about original thought: That original thought is not a quick conclusion, but rather a journey through sometimes distantly linked ideas that is sometimes slow and painful and on rare occasions quick and easy.
Part of a founders gift is to understand this journey and build a product, a team and a business that is able to take the lessons learned from this journey and turn them into something tangible and lasting.
Beginning the Journey
Like Rome and good ideas, great founders aren’t built in a day. Part of the difficulty to finding a quick path to becoming a great founder is that there simply isn’t one. Though great founders (specifically of technical companies) tend to have a few things in common, the evidence suggests that they can be vastly different. Bill Gates and Steve Jobs are remembered as founders of two of the greatest technology companies of our time. But the two couldn’t be more different.
While one of Bill’s greatest strengths was his understanding of the ebbs and flows of the Personal Computer industry, Steve made his mark by focusing, almost singularly, on the design of his products. While Mark Zuckerberg was a coding guru at 14, Brian Chesky, co-founder of AirBnB, still isn’t a techno-wizard at 34. Unlike professions like Medicine or even Teaching, where the barometer for what a good Doctor or Teacher may look like, has already been set and is, within certain limits, easier to emulate – there is no clear cut definitions for what a good founder looks like. The dual roles of luck and timing further exacerbate this in a startup. A great startup founder, may have a great idea a great team and even a great business. But, by some stroke of nature, the will of the market may simply not take it up. And that’s it, even great founders can go out of business without the market supporting them.
Enter: the Message Pad, Apple’s little known first attempt at creating the – then non-existent – tablet computing market. Built in 1993, the Message Pad had a 6 inch screen and weighed 800g (the iPad Air has a 9.7 inch screen and weighs 469g). The Message Pad ran the Newton OS and an innovative text recognition system. Complete with a calculator, scheduling and notes, the Message Pad was slated to be the next big thing in tablet computing. Unfortunately, it never lived up to that grand expectation. Technical difficulties associated with the Message Pad made it the butt of market jokes – it even got a spot on The Simpsons. It would be 17 years until Apple cracked the Table code and released the iPad.
We know from history that Steve Jobs was not a bad founder. And we also know that the tablet market would eventually be a great one. But even good founders, and good ideas, are subject to market forces.
To Apple’s credit, they didn’t quit on what they felt was essentially a great idea, even if they didn’t get it right the first time. Great founders learn with experience, just like great ideas grow a little clearer with time spent in front of customers. The “in front of customers” part of that is especially important. There’s just no overstating how important it is to get customer feedback while the product is still evolving. Good ideas can get lost down their own paths when founders are left to their own devices. Ideas that are critiqued in the harsh light of customer feedback tend to become better products much quicker, and far more often than those that don’t.
Growing a Good Idea
When I was younger and the world was slightly more simple than it is now, one of my favourite shows was a cartoon named Animaniacs. From time to time, the show covered the antics of three old cartoon stars named Yakko, Wakko and Dot while they ran around the Warner movie lot. The rest of the time the show was a variety of skits and bridging segments about things I didn’t really understand, but were funny all the same. One of the skits in the show was a segment called “Good Idea, Bad Idea”. The skit basically went through a number of ideas that may be good things to do and others that just weren’t. For example:
“Good Idea: Tossing a penny into a fountain to make a wish.
Bad Idea: Tossing your cousin Penny into a fountain to make a wish.”
– Animaniacs, Good Idea, Bad Idea Skit
The goal of the show was to be funny instead of to provide founders with good ideas to implement, so they were, more often than not, simply there for a laugh. The nature of the skit highlights something in real life, though: Good ideas and bad ideas can, sometimes, be really difficult to tell apart.
For clarity, I think it’s important to mention that what matters when implementing any idea is the execution rather than the idea itself. Good ideas, done badly, are often indistinguishable in their result from bad ideas done well. Both are very likely to fail.
Considering this, the question then becomes: How does a founder differentiate a good idea from a bad one?
Part of what follows from believing that good ideas come out of nowhere is a misunderstanding about how most of them grow.
Most people will agree that a great core idea is critical to making a great business:
Of course people are looking for new ways to search the Internet based on what everyone else is looking at. Of course people want to be able to stay in other peoples when they travel instead of a hotel. It all just makes sense now. But did it all make sense when Google and AirBnB started?
The short answer is no.
When Larry and Sergey started BackRub (what Google was called before Google), they were actually late to the game. Instead of having a first mover advantage, BackRub was coming into a market that was already dominated by search giants like AOL, Yahoo! and MSN.com. What’s more, the industry has already agreed that search portals are bum game in and of themselves, and the real value is to get advertising revenue out of them since so many people need to use them. This was the established business model for search engines at the time that BackRub started.
But Larry and Sergey realised something. Something that all of us who’ve grown up on the internet recognise. Ads are annoying. No one wants to see a pop up offering them the next big thing in burning fat all they really want at that time is to find out where the nearest (and greasiest) pizza joint is. Larry and Sergey were originally against this. And they started a search engine that not only didn’t bombard people with Ads, but showed people which greasy pizza joints other people were looking.
When Brian Chesky, Joe Gebbia and Nathan Blecharczyk started AirBnb, their idea was equally tenuous. The hotel industry had been standing for ages and for all intents and purposes, was (and still is) pretty entrenched as the defacto choice of home away from home. But Brian and Joe had a problem: They needed to make rent and they were broke. Luckily, there was a convention in town soon and hotels were packed – people had nowhere to stay. They realised they could make up their shortfall by just renting out their own home for the exact amount that the people needed at a radically reduced rate compared to their hotel counterparts.
They put up the ad, and as can be expected, people came to live with them for the conference. And what’s more, they had a great time. Brian and Joe were great hosts. They did the conference, they got to know each other, they took pictures. They did all the human stuff that one generally doesn’t get to do when living in a hotel in a strange town where they don’t know any of the people. Brian and Joe provided a living space, but they also provided something much more important: a community.
The two companies have very different origin stories, but both of them share one thing in common. Both of the companies saw a problem that people with the solutions that currently existed (there were already search engines and hotels when Google and AirBnB came into existence) and they went out solving it. One, by solving a problem its own founders were having (making rent), and the other by solving a problem that a lot of people were having (having a good search experience).
The common factor in Google and AirBnB’s story is the crux of what differentiates a good idea and a bad idea. A good idea is one that has market applicability. A bad idea is one that doesn’t – just that simple. A good idea solves a problem that enough people want to solve. Implementing a good idea is all about finding a way to reach those people with your solution. Said another way, a good startup idea is one that focuses on making something that people want. A bad startup idea is one that focuses on making something people don’t want.