Startup
How to Get and Evaluate Startup Ideas ?
How to Get and Evaluate Startup Ideas | Startup School
Mar 202510 min read
How to Get and Evaluate Startup Ideas ?
How to Get and Evaluate Startup Ideas | Startup School (opens in a new tab)
“Nobody know for sure if a startup idea will work”
Startup Data Resources
- Analyzing where the top 100 YC companies got their ideas.
- From a classic essay by Paul Graham: “How to get startup Ideas”
- Reading multiple startup applications (analyzing the mistakes that founders make picking ideas)
4 Common Mistakes with Startup Ideas
Not solving a real problem
(Solution in Search of a Problem)
- This approach will result in finding a problem, but it will be a superficially plausible problem (made-up), that people don’t care about the problem
Suicidal Problems
- like global property, these problems are real problems but they are too abstract to make good starting points for startup ideas.
- It should be more specific and traceable
Getting stuck on “Tarpit Idea”
- If the Idea is stuck and never seems to go anywhere.
What causes Tarpit ideas?
A widespread problem that lots of potential founders encounter
- These are common ideas that are much harder than they seem.
- (which is after many years, they are unable to solve this)
Not evaluating an idea
- Evaluating ideas involving market research, feasibility, etc.
Waiting for the perfect idea
- Most dangerous are founders who sit and wait around for the perfect startup idea
- These people never actually start a company.
“You should think of your initial idea as a good stating point. Startup ideas morph over time”
From “How to get startup ideas”
10 Points for Evaluating Startup Ideas
Do you have a founder/market fit?
Plangrid (Architecture planner for iPads)
- Are you the right team to work on this idea?
How big is the market?
Coinbase (Crypto Current Trading)
- Presently has a good market
- The market which is small but rapidly growing
How acute is the problem?
Brax (makes credit cards for startup companies)
- It is a problem which does not have any alternative, which makes it a good problem
Do you have competition?
- Having competition is good because it helps evaluate the market for an idea.
- If there are too many competitors in the market, then it is better to find a new insight
Do you want it personally?
- Does your idea have any market demand?
- Talk to users about the idea
Has this recently become possible or necessary?
Checkr (Background checks for companies that do mass hiring)
- like some new changes, which helps find new problems and create a new opportunity
Are there good proxies for this business?
Rappi (similar to Doordash but in a different region)
- A proxy is a large company that does something similar to a startup, but it is not a direct competitor.
Is this an idea you want to work on for years?
- Ideas that solve boring problems (like tax accounting software)
Is this a scalable business?
- All software businesses are scalable businesses.
Is this a good idea space?
Fivetran (tool for data analysis for companies)
- An idea space is a level of abstraction, out from a particular startup idea.
- It is a class of closely related startup ideas, like software for hospitals, or food delivery services.
- Vertical SaaS (Software as a Service) has a higher success rate than consumer hardware, social networks, advertisement
Coming up with ideas
- Become an expert on something valuable
- Work at a startup
- Building things you find interesting
Startup ideas seem bad but make them good
- Most founders will abandon these ideas, which allows smart founders to work on them.
1. Hard to get started
(Schlep Blindness paper)
Stripe (payment gateway made easy for developers)
- Many developers knew that creating payment gateways was a huge problem but nobody worked on it.
- Getting started was much harder, which included:
- Special deals with banks
- Understanding How Credit Cards Work?