Why startups should solve a problem, not chase an opportunity
and other things I've been thinking about
So moving is a nightmare (as many of you probably know all too well).
I won’t bore you with the details but I just had to endure a bit of a nightmare move that distracted me for the last few weeks. I’ve had very little time to read, reflect and write about what has been on my mind, but I’m back!
Last month, I came across an article by Brian Balfour that really resonated with me. (In case you haven’t heard of him, Brian is Hubspot’s former VP of Growth and the current founder/CEO of Reforge.) I haven’t had a chance with the move to write down my thoughts till now…
The article, titled Problem vs Opportunity First Approach, argues that there are two reasons why people start a company. The first is to solve a problem and the second is to go after a market opportunity.
The starting point for solving a problem usually comes from personal experience (“I’m struggling with x and I figure I’m not alone”), whereas going after an opportunity usually originates from observing an unmet need in the market (“I noticed x trend is happening and I think there’s an opportunity here”).
While neither approach is right or wrong, I agree with Brian’s hypothesis that most of today’s wildly successful companies are those that went after a problem. And that as a founder, it’s easier to find the stamina needed to be successful when you’re solving a problem rather than chasing an opportunity.
Let me explain using my own personal experiences.
At Charli, we started out because we saw an opportunity. For us, that opportunity was AI. As someone who loves tech, I was excited to develop our own AI that was interactive and that would bring specific capabilities to market in a new way. We were developing something we felt was missing from the marketplace.
I’ll admit that this posed challenges. We tried a few different approaches to find our product-market fit. But it never quite felt right. Instead of honing in on the true problem we were solving, we were dancing around it. Yes, Charli’s AI technology was – and always has been – something very special and unique, but we couldn’t quite figure out who our target market was or how best to apply the AI to them.
After considerable reflection, we decided to switch gears and instead go after a problem.
That’s when everything in our company shifted.
It was our moment of clarity.
No longer were we trying to develop AI and fit it to the market. Instead, we had identified a very real problem and we were using AI to solve it. And that problem was content management.
Content management is something that has frustrated me to no end for years now. Why is it still so difficult to find what we’re looking for? Searching through emails, Google Drives, Dropbox, link clippers, and more, to find that one item you need...all of this takes considerable time. I’ve faced this problem on a daily basis while building my past companies while doing my home reno while running Charli, and so on. Finding, sharing, and managing content in today’s digital world is truly a hassle.
Once we honed in on this problem, everything fell into place. We’ve made some exciting changes to Charli as a result, and we’re getting a great response from our users. Rather than seeing Charli as simply an AI-driven content assistant, we now see it as a unified workspace for digital content and cloud apps. We know we’re on to something incredible, and I’m looking forward to sharing some big announcements with you in the coming months.
Looking back on our journey, I completely agree with Brian Balfour when he says in his article, “Being a founder is a rollercoaster. When you are in a down moment, [your] source of energy and motivation is stronger when it stems from the problem vs the opportunity.” I also agree with him that going after a problem is more fulfilling and rewarding.
If you’re struggling in your business to find your product-market fit...or to keep your motivation up…or to progress to that next level of growth...or with any number of challenges, I highly recommend you revisit the problem you’re trying to solve. It might just be your golden ticket to success.
Well said, and I totally agree. You’ll get far more satisfaction solving a problem than you would chasing a market. Charli is making great strides and the continuous improvement is amazing!