What Are The Best Ways To Think Of Ideas For A Startup

What Are The Best Ways To Think Of Ideas For A Startup

This variation on the popular question comes from
. In order to answer this question let's look at the ends of the opinion spectrumfor answers.

“Because if we understand what the extremes are, the middle will take care of itself”. – Dan Formosa, Smart Design, Objectified” 

For my extremes I am going to take the viewpoints of two startup entrepreneurs who have widely varying background and opinion. Lets look at what Russel Brunson and Paul Graham have to say about getting startup ideas.

I like to look at these two gentleman as they have both changed the face of business in their own right in completely different ways.

Paul Graham was one of the founders of Viaweb, an ecommerce shopping cart software company that was sold to Yahoo for around 50 million. Paul Graham was one of the first software as a service entrepreneurs and has since changed the world with his startup accelerator Y-combinator.

Russel Brunson is arguably the word's most famous direct response marketers. He currently runs the world's fastest growing bootstrapped software company Clickfunnels, valued at over 350 million in 2017. Russel Brunson's ideas have changed online business for 10s of thousands of non venture backed internet entrepreneurs.

Whats interesting about considering the ideas of these two gentleman is that they occupy completely different spheres within the world of online business. The majority of entrepreneurs Russel Brunson works with probably are not familiar with Paul Graham's work. Similarly, the majority of entrepreneurs Paul Graham works with are probably not familiar with Russel Brunson's ideas.

Combining the ideas of these two "extremes" accounts for such a wide range of entrepreneurial wisdom that it effectively "takes care of the middle" or more moderate views on starting a company and marketing a product.

Paul Graham On Getting Startup Ideas

Paul starts off ith conviction about the main problem with startup ideas. People are not solving a real problem. This advice comes after Paul's work with hundreds of founders. After a while he started to notice that many people get stuck with a certain product idea or functionality they want to build.

He noticed that it was very hard for people to let go of an idea they wanted to build after they had convinced themselves or their teams that this was the thing they were going to build their company around. Paul calls these ideas sitcom ideas. They are ideas for a company that sound plausible but are actually bad.

Paul says that is can be very difficult to tell the difference between a plausible idea that is bad and a genuinely good idea for a product or service that people will want. A simple Heuristic Paul developed for people to figure out whether or not an idea is valid is to think about who really needs what you are trying to build.

"When you have an idea for a startup, ask yourself: who wants this right now? Who wants this so much that they'll use it even when it's a crappy version one made by a two-person startup they've never heard of? If you can't answer that, the idea is probably bad." - Paul Graham

Once you have something you know some people want, you need to figure out if there are any other groups of people that will want what you are building based on a similar use case.

You can think of these similar use cases like a set of eccentric circles. In the center you have the group you have identified that really wants what you are building. Around that group you have slightly different groups that want the product you are building or a slightly modified version of your product, perhaps with a few added features or types of functionality.

Paul says there is no shortcut to being able to identify these groups of the market you might be able to offer your product or service to. Paul writes that the best way to have good "hunches" about the markets you can move into is to be on the cutting edge of a certain field.

Paul mentions that you do not have to be on the cutting edge of a field actually developing a technology. You can be on the cutting edge of a field as a user as well. Once you are on the cutting edge of a field as creator or user you can "Live in the future, then build what's missing". In this way, you will know what adjacent markets your product or service will be a fit for.

Its clear from his writing that Paul does not think their is a shortcut to gaining this type of "insider" knowledge. You need to be immersed in a field as a creator or user. Once you get their you will develop the the knowledge to intuitively understand use cases for a new technology.

Russel Brunson On How To Start a Startup

In Russel Brunson's article "The Secret Formula" he talks about the correct way to come up with an idea for a startup. Specifically, Russel talks about validating your market before you create a product.

"Most entrepreneurs (me included) – when we first get started, it’s usually because you have a cool idea for a product or a service, so you get excited, and then you go and create it." - Russel Brunson

Russel's method for figuring out and validating a startup idea is to figure out who you want as a customer and how you will provide value to them. His process looks like this.

This idea is not new. Russel is emphasizing finding the correct market for your company and the value you can provide. This emphasis on "market risk" (who is your market) is becoming more common.

Why The Focus On Market Risk

One of the reasons for the emphasis on market risk is the ubiquity of internet technology and applications. Unlike physical product which have not changed much since the mid 20th century, digital products have undergone a rapid transformation in the last 50 years.

Just 20 years ago, the idea of a web application was pretty unique. Around this time Pau Graham's Viaweb formed the basis for one of the first major online order processing systems, Yahoo stores!

At this time, one of the main risks that a new startup idea faced was whether or not their core technology would work. Back when Paul Graham was building Viawed, people weren't really sure if a cloud based order processing and checkout system would work.

If we fast forward 10 years to 2009 - 2010, the idea that a cloud based web application could work and would be scalable was common. The main risk inherent in starting an internet company was now product risk. The concern over whether core technologies of web apps would work was replaced with a concern over whether users would adopt a new product. Tech companies and investors became focused on "product risk". Investors wanted to know if a product was good enough to get users to convert from whatever they were currently using.

Finally, as high quality cloud based applications with amazing design and functionality became more common the main risk inherent in starting an internet company became "distribution risk". As Brian Balfour mentions in his article Growth Wins.


If you are trying to get an idea for a startup it's important to focus on your market, the product you want to make and the technology you are going to use, in that order. This applies to 99% of companies.

The exception to this rule is if you are creating an technology that has never been used in a commercial product. This applies to products that have an obvious demand in the market place.

A good example of this type of startup is Space-X. In this case, there is an obvious demand for lower cost transportation for industrial equipment into space. There is very little market risk assuming you can pull of the technology and productize it in a way that makes sense for your potential customers.

For most other types of companies, you need to build your product or service around a market and a specific need that they have. Who do you want to serve and what can your provide them with (product or service) that is valuable.

← View all posts