Scott Maxwell

@scottsnews

Just because your idea stinks doesn’t mean your startup can’t be successful

No one starts a company without convincing themselves that they have a great idea. But one of the biggest hurdles to success is the belief that your idea is too great to modify.

This is the paradox at the heart of any successful company. The way through it is to realize that there is a continuum somewhere of favorable outcomes. A hypothesis that gets a project started is merely a shot across the bow. A smart entrepreneur experiments endlessly to discern this range of outcomes, finds out where the successful end is and modifies the idea until it has the best chance of success. You do this until you find success or your funding runs out.

Wittgenstein’s Ladder and startups

This concept of a “starter idea” isn’t new. Philosopher Ludwig Wittgenstein came up with the metaphor of a ladder that gives us a better view, but that needs to be kicked away once we climb it. For example, great jazz musicians need to know all the musical rules so they’re free to break them later. To understand quantum physics, you need to grok standard physics first and then accept that quantum physics negates many of those rules.

Another variation on this idea is Alfred Hitchcock’s conception of the MacGuffin, an object in a movie or book that merely serves to keep the plot moving. For example, the search for R2-D2 was the MacGuffin that got the first (or fourth?) Star Wars movie off the ground.

Think of a great startup idea as a MacGuffin. Its purpose is to unify your team and offer a focus. It may be good enough to take you all the way to the finish line, but that’s unlikely. If you do make it to the finish line, your idea is likely to look very different.

The continuum of successful outcomes

Think of some recent very successful startups. Instagram began life as a Foursquare-like check-in app but cofounders Kevin Systrom and Mike Krieger noticed that people were using the service to share photos. Airbnb was built around the promise of an air mattress and a guaranteed breakfast, but most users didn’t care about those things. These pivots are well-known and even the idea of pivoting is hackneyed now.

Of course you can overdo pivoting as well. If you completely shift your company’s mission and goals more than once, investors will lose confidence in you and so will your employees. Both a failure to pivot and over-pivoting are hazards. So what’s the best course of action?

According to research, the top reason that startups fail is that there’s a lack of market need. That’s what happens when your grand idea is released into the wild. We have all experienced this disconnect. I’ve blogged for many years, for instance, and there were times when I’d put a lot of effort into a post that I thought was going to be huge and it landed with a thud. Then there were posts that I published with little thought that caught on big. You never know.

There’s no surefire way to crack that code, but I find the following metaphor to be helpful: Imagine there’s an infinite number of possible ideas to try and results of the ideas to capture. Now imagine that you were able to try every possible idea and get the resuts and you arranged in order from most successful to least successful. Finally, imagine plotting the results on a chart with the vertical axis being level of success and the horizontal axis being the best idea, followed by the next best idea, followed by the next best idea, and so on. Then connect the dots to get a curve.

What would the curve look like?

My view is that the best idea would have very high success, thereby being very high on the vertical axis. The second best idea would have great success, but significantly lower success than the best idea. The third best idea would have good success, but significantly lower success than the second best idea. And so on. The curve might look like the curve of a ski slope, steep on top and less steep as you move down the curve.

The trick is to find the best idea, but no one really truly knows the best idea until you start doing experiments with your best set of ideas ranked by your perception of how they will turn out. You can use intuition and as much research as you want, but no one knows how people will react to a stimulus (a.k.a. your idea that touches the market and they respond). A whole genre of hidden-camera TV shows is based on this premise. The more well reasoned ideas that you can test, the greater the possibility of finding the best idea!

So to recap: Start with an idea that’s good enough to give your startup organizational momentum to bring it to the market. Then prepare to abandon or drastically modify that idea based on customer reaction and then keep trying new ideas, major changes and/or minor changes, forever…remember, there are an infinite number of variants on the idea.

This is a company-level variant on the macro level start-up game where thousands of ideas get tried by thousands of start-ups and there is a result curve that you could plot with the largest and most valuable start-up being the one that found the market response to its idea to be the fantastic early in its own experimentation.

If you can keep the funding going while you do this, you have a shot at success even if your initial idea was lousy — and chances are, it is.

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