After a long long hiatus (ie been far to busy working finishing a startup) I decided to write a post. My own blog is still lacking in posts due to work, but will get back to that this week.
Anyhow have been thinking about this for some time. I have looked back at several startups, we all know of Google, Yahoo, Indiatimes, Facebook etc etc, but I am wondering all these which got funding, did they really solve a problem, I mean isn’t that what all VC’s really want, or maybe they did and it was just me that didn’t have that problem in the first place.
Lets look at Google, everyone says it solved the problem of being a better search engine, or rather it was a better search engine than those that were around during those days (I was a fan of Lycos). But how did we know we needed better search, I mean you can only tell you need better search if you know what else is out there, and I for one dont recall comparing search results everytime between google and lycos to see which was better. Hence was google a success because of search or simply because of speed. Lycos was full of ads, we all had 28.8K modems or some of us have the V90, K56Flex modems, but speeds were still slow, when google came along it just returned the results quicker…not sure if they were better.
Now lets look at Facebook, If I was do come to a VC with cap in hand and say “Please sir can I have some more…funding that is” and my idea was to build facebook. I am unsure as to what problem I would actually be solving, is it to get people to communicate, or to waste time at work, or to connect. I am talking about seed stage funding here, not the 3rd rounds where VC’s just follow others. What problem did/does Facebook solve.
What did Skype actually do that Yahoo Voice chat could not (agree quality at that point was better), but did it solve a problem that people just needed to solve.
What about twitter, did we really have a problem with telling the world when we get up out of bed 🙂
Did we really need a Zimbra, didn’t email just work before.
Did these companies and other really successful ones solve a problem, or are they just things that we use because out friends use them, and so we must also, and if that is the case, how would you ask a VC for money for something like that 🙂
Iqbal
P.S Next post – How does a company like minglebox ask for $ 8 million …and what does it spend it on
- Building a startup in 30 mins (well 41ish) – Iqbal Gandham - December 3, 2009
- Should Facebook and Twitter bother to make money? (Iqbal Gandham) - February 17, 2009
- How we got Nivio to Davos (WEF)…and won - February 5, 2009
Super post Iqbal! “Better, faster, cheaper” is never given its due but some of the world’s largest businesses are just that.
On hindsight, while explaining success stories, if we want to, we can always associate the concept of a “need” being filled. But that is more forced than real. As society progresses, yesterday’s luxuries become today’s comforts, and yesterday’s comforts become today’s needs.
But yesterday they were definitely luxuries and comforts only, and certainly not needs. You may not be able to do without Facebook today (perhaps!), but you did not even think the need for it, few years back and life was just fine without it… !
Hi Iqbal 🙂
Nice views..but to take the discussion forward..I think taking the much quoted VC phrase “we want our startups to
Solve a problem/need..” and trying to apply it every startup would be almost falling for contextomy 🙂
Lets look at Facebook for instance…
Was FB really trying to solve the “to help people communicate or connect” problem…NO
Myspace..friendster were already creating social networks by then..and yeah people could easily communicate with friends in more ways than one..(IM,Email,blogs ..you name it!!)
I believe what FB did was “to provide a way to replicate your exclusive Social network…online..and be in the know-how of what your friends were upto..)” the feeds feature came much later..infact the much loved feature was a subject of huge uproar when it was deployed…
Anyways…I am sure we all know of FB’s history as to how initially it was almost closed Social network where you needed an invite and had to hav an email id of Harvard or Ivy league University….
By the very nature of markets and mindsets// anything exclusive and in short supply had to be cool … and that was exactly why FB clicked when Friendster and others faltered…add to that Mark Zuckerberg and team took care of Usability and otehr issues..(Executed the Basic Idea Well)..Facebook took off in an unprecidented way!!!
without digressing…Facebook Solved the problem of “a way to communicate in a secure environment where you were sure the only ones looking at the party pics where people you knew and not some stalker…”
Coming to Mother of all Startup-Ships…Google…
Did it solve a problem??– I wouldnt speak for others…but I felt it surely did mine…and a lot of researchers..
Around late 90s..I do remember vividly a large number of search engines that were on my bookmark list…Dogpile..Vivisimo ..teoma…Alltheweb..lycos..Google…that I used for my reaserch at University..
Cont :-
But what did Google offer that others didn’t….You were right it offered Speed..almost blindingly speed results…But what it offered to me was almost surprisingly accurate results and a way for controlled querying,…
I no longer had to look at results where the searched query just happens to appear a 1001 times… Pagerank was a clear improvement over other existing search algorithms. and the by taking up the gargantuan task of indexing the whole web…Google gave me speed. very important in those low bandwidth days!!!
Yeah I used to compare results across search engines and google’s results were the most relevant of the lot.
(Those were the days when SEO and Google bombing were not mainstream words..)
It almost came to a point that what once used to be a definite set of links for research was now one stop pit…
Need a meaning for a word. Forget typing dictionary.com…
It solved the need for a way to navigate the internet seamlessly…
I know my comment is already too long. But I would close with one observation…
Startups need not always solve problems….they usually fall under one 2 categories…”Nice to Have” Vs “Must have” [For their target audience of course]
These days having a functional personal email solution with enough storage space and good functionality is a Need.
But having online social network presence or a blog is a “Nice to Have” scenario… Some thing like a Vitamin pill while the earlier one is a Pain Killer..
What Blogger/wordpress/twitter did was give people ” a channel to communicate/express their views to the world with the click of a button-uncensored”
…Now everybody could be a writer….Every one could be a journalist and command an audience…You very chance to be heard and express
What Flickr/Shutterfly/Youtube enabled was yet again a way for people to express their ideas of fun or creativity to a large audience…
Almost always these ideas dont look they had the capability to be the large billion dollar corporations that they are now when they started…but sure they did look like they were making some ones life a little easier than yesterday….
Almost all these startups looked like they were answers to a “Dear Lazyweb…” query and that is the answer to what problem they solved!!
…I might be totally wrong and opnionated..but then I always enjoy a good debate…so let the brick bats come flying 😉
–Upendra
Good thought provoking post. IMHO, “need” may not exist in a well identified and understood form, when a Startup starts up. The “need” may then be created, by seeding the desire or want that never existed in the first place. That is a crucial function of Marketing, and one of the ways it is fulfilled is through overt or covert advertising.
One intrinsic “need” that we are probably overlooking in the original post is that the humans need to evolve, explore, learn or just plain “change” (as in fashion). And then the human psychology pyramid comes into picture, Physicals Needs, Physiological Needs, Social Needs, Higher Needs… s.a. a diamond studded iPhone. It’s hard for me (as a person) to quantify for need of such an iPhone. What “functionality” did it add (i.e. the diamonds) ? But businesses manage to sell it, because it fulfills an intrinsic higher order need to satisfy one’s ego, of them being able to show-it-off to friends etc.