But don’t worry — The bigger the problem, the bigger the opportunity. Last week, I had an interesting breakfast meeting with a local entrepreneur who has had a couple of impressive exits. Given his track record of building successful companies, I was curious to know what he wanted from me. Surprisingly, he sought my opinion on a new startup idea he was considering. After selling his last company and enjoying some luxurious world travel, he was restless and eager for his next big venture. His strategy involved pitching his ideas to other entrepreneurs to identify potential flaws.“Since you’re always writing about startups,” he said, “I thought you’d be good at poking holes in one of my ideas.”Flattered, I agreed to give my thoughts. While I can’t share the specifics of his idea, it was a straightforward software concept that seemed so obvious, I was surprised it didn’t already exist. We spent most of our conversation marveling at its simplicity and lack of competition. After about 30 minutes, I admitted, “Sorry, but I don’t see any major problems.”“That’s my concern, too,” he replied. “Why doesn’t this thing already exist? What’s the critical flaw?”
Why Every Great Startup Is Critically Flawed
To those unfamiliar with the startup world, our concern might seem odd. Aren’t problems bad? Wouldn’t entrepreneurs want to avoid ideas with glaring issues? Counterintuitively, the answer is no. Every startup idea has at least one fundamental flaw or reason it doesn’t already exist. Startups solve problems, and if a solution were straightforward, it would likely already be on the market. Take Uber, for instance. Fifty years ago, the idea of summoning a car with a button press would have seemed fantastic. Yet, it didn’t exist because the necessary technology—GPS-enabled smartphones—wasn’t available. The lack of technology was the critical flaw that prevented Uber from existing until it could be addressed. Similarly, every startup idea that doesn’t exist today has at least one critical flaw. These flaws might not be as obvious as the technological gap that delayed Uber, but they exist. Good entrepreneurs know they need to find and address these flaws before they can build a successful company.
The Importance of Finding the Critical Flaw
Identifying a startup’s critical flaw goes beyond understanding why an idea doesn’t exist. It involves a deep comprehension of the market, technology, and customer needs. This knowledge directs efforts precisely where they’re needed most. Consider Airbnb. Initially, the idea of renting out spare rooms to strangers faced significant flaws, including trust issues, legal hurdles, and market skepticism. By addressing these through verification processes, insurance policies, and community-building efforts, Airbnb turned potential deal-breakers into strengths. Tesla’s story is another example. Early electric cars were hampered by expensive and inefficient battery technology. Tesla’s breakthrough was not just in making electric cars but in making them viable by innovating on battery technology and building a supercharger network, transforming a niche market into a mainstream one.
Conclusion
Every successful startup is a testament to the power of identifying and solving critical flaws. If something doesn’t exist, it doesn’t exist for a reason. Understanding that reason is crucial to building a successful company. You don’t need all the answers from the start, but knowing the big problems you’ll face prepares you for the challenges ahead. Before you start building your startup, poke, prod, and question your idea until you find the core issues. Once resolved, these will pave the way for your startup’s success.
