I've never met a successful entrepreneur who sits around trying to come up with business ideas. At the risk of sounding negative and grumpy, groan. Another one of these blogadoodoos. What follows is my $.02, some might disagree.
From what I've seen it goes "I have experience in this area" -> "Wow there are under-served market needs here" -> "I have some relevant experience to start a company that addresses it and can attract talent" -> startup.
Not "I'm a wannabe entrepreneur" -> "I have no domain specific expert knowledge" -> "let's randomly find something we guess people care about and overspecialize" -> start coding blindly or find a Rails dev on Odesk. Seen that one fail innumerable times.
One other thing. If you have to go searching for ideas, you probably have no business experience. Let's say you manage to find a good idea using something like the techniques of this blog post. You manage to secure some funding. The startup starts to do well. You then become a sitting duck to be ejected by your investors, as you've built the product, but are inexperienced in business, and they specifically will want you out for that reason.
An exception to this is incubators like Y Combinator, who are more concerned with team chemistry than idea. If they weren't buying the concept but want to give you a shot, they might stick your team on an idea other than yours. But they probably already have an appropriate idea in mind, they don't have to go hunting.
Another possible exception is Stanford MBAs, specifically.
>>Not "I'm a wannabe entrepreneur" -> "I have no domain specific expert knowledge" -> "let's randomly find something we guess people care about and overspecialize" -> start coding blindly or find a Rails dev on Odesk. Seen that one fail innumerable times.
What kind of domain specific expertise did Mark Zuckerberg have when he wrote Facemash (Facebook's predecessor)?
The answer is "none." It was a pure hobby project - he didn't even plan on monetizing it. Yet here we are.
My reply is coming late, but I can understand how my point could be unclear. Let's break it down for Zuckerburg's case, and see how it fits. Unfortunately I will have to resort to common lore.
1. "I have experience in this area"
Yes, yes, and hell yes. Zuckerburg was conscious of social dynamics to the nth degree. This is the executive who publicly admitted his company is no longer cool because he's just that realistic and expert.
2. Wow there are under-served market needs here
He seemed to know that it was at the point where the web had become so universal that both male and female students would be entertained by this idea and treat it like a game. American college students f'ing love social games. What Facemash did isn't really possible in the physical world, so it was a new kind of game that appealed to both genders. Young women were an absolutely underserved segment of the digital entertainment market. And for anyone of either gender who doesn't usually like games played on screens, this game was easy peasy and required no hand-eye coordination and had zero learning curve.
3. "have some relevant experience to start a company that addresses it and can attract talent"
He's a coder. He had the idea. He executed. He attracted talent immediately. Coding became a whole helluva lot sexier than before because this was a social game and people liked it. It wasn't DOS or LotusNotes, other runaway successes by coders that probably never got them laid at a frat party. Bill G on the Byte cover anyone?
4. -> Facebook.
What happens when we fill in the alternate?
1. "I'm a wannabe entrepreneur"
Debatable. I was kind of being snarky with this point anyway. But he was a CS major, and he seemed fueled by parlaying his coding skills into social status. I am not his therapist though.
2. "I have no domain specific expert knowledge"
The way he is portrayed, he was an absolute expert at negative social dynamics and appealing to people's social motivations, often in a less than wholesome way. He seems way expert to me.
3. "let's randomly find something we guess people care about and overspecialize"
Here's the CRITICAL point you missed. He did not sit around trying to come up with ideas. He had a razor-sharp, almost game-theoretic perspective on college socialization. He honed in immediately on how to exploit that, scraped the dorm directories, and manifested his idea quickly.
4. -> start coding blindly or find a Rails dev on Odesk
THERE WAS NOTHING BLIND ABOUT WHAT HE DID AT ALL. It was razor-sharp, targeted, deliberate, and in my view, brilliant.
Ie, he had his idea and executed and holy shit did he succeed. He wasn't sitting around twiddling his thumbs dreaming up what feature he could steal from something else as is basically the main point of this article. Friendster and MySpace were knocked out quickly because Zuckerberg was considerably more expert than them.
I agree with everything you said except the last part... "Another possible exception is Stanford MBAs, specifically."
I will also add, it is important to have a good combination of good team with a good idea. You can't just have a great kickass team and expect your idea to be successful. Think Color, Foursquare, Cuil etc.
The brilliant part is Amazon doesn't make money directly by selling books, they make money by not paying for books until they are all sold (so publishers are effectively floating them interest free loans for every new title).
Exactly- that can be seen as CFO qualifications, a background that I think primed him for Amazon well. Amazon is a CFO-type idea- small margins, obscene volume, financially micromanage the infrastructure.
To call Amazon a bookseller is missing their entire raison d'etre. Bezos wanted to be King of Volume, and how much of their current revenue is books? Can you imagine Barnes and Noble starting BNWS?
As a hedge funder he'd be looking for secure, smaller returns through diversification. Sound anything like Amazon's business plan?
This, yes, a thousand times. Building a startup is gruelling and I wouldn't be doing it at all if I hadn't had such an urge to fix a problem I actually faced/was angry about and saw that no one else was fixing it.
The thing is, everyone reads the news and thinks they can come up with some alright idea and make a few million in a couple years. Most of them don't know how hard it is because they've never done it.
The only upside to "looking for startup ideas" is that it is better than sitting and doing nothing or watching 13 episodes of house of card on netflix for example. The key is to not commit to an idea that was generated in this essentially random manner. Treat such ideas as "projects" where your main objective is to learn. Perhaps do a few in parallel. Experience naturally follows and then real ideas can spring forth. The mistake is to "come up" with an idea and then blast full steam ahead when there is no basis for real conviction.
You don't ever seem to find startup ideas. Startup ideas seem to find you. That's why it's important to always be listening - if you listen often enough then problems will "appear out of nowhere" and you'll be in a good place to understand their potential.
I thought the author made a good point though, actually said what you're saying. This is just if you are in a pinch or need to pivot. I thought it was a good article, wish he had written a little more,
1. giving sufficient reason to take legal action.
2. able to be done or acted on; having practical value.
Up until about 10 years ago, it was nearly exclusively used in the first sense. The second sense was popularized by pop-business gurus promoting with proactive dynamic enterprise synergistic actionable best-practices...
From what I've seen it goes "I have experience in this area" -> "Wow there are under-served market needs here" -> "I have some relevant experience to start a company that addresses it and can attract talent" -> startup.
Not "I'm a wannabe entrepreneur" -> "I have no domain specific expert knowledge" -> "let's randomly find something we guess people care about and overspecialize" -> start coding blindly or find a Rails dev on Odesk. Seen that one fail innumerable times.
One other thing. If you have to go searching for ideas, you probably have no business experience. Let's say you manage to find a good idea using something like the techniques of this blog post. You manage to secure some funding. The startup starts to do well. You then become a sitting duck to be ejected by your investors, as you've built the product, but are inexperienced in business, and they specifically will want you out for that reason.
An exception to this is incubators like Y Combinator, who are more concerned with team chemistry than idea. If they weren't buying the concept but want to give you a shot, they might stick your team on an idea other than yours. But they probably already have an appropriate idea in mind, they don't have to go hunting.
Another possible exception is Stanford MBAs, specifically.
So much advice on blogs. Be careful.