Many side projects and companies succeed because they solve problems that need to be solved or enhance current products.
If you find that to be more easier said than done, here’s a quick fix: At last week’s CNBC Make It: Your Money virtual event, self-made millionaire and CEO of RSE Ventures Matt Higgins advised studying those who have previously overcome unresolved challenges.
According to Higgins, “the vast majority of game-changing businesses are actually built on [those] insights,” adding that “we all have within us a proprietary insight about how something can be done just a little bit better.”
Higgins cited one specific millionaire as an example: Brian Chesky, the CEO of Airbnb, who inadvertently co-founded the company in 2007 while coming up with ideas for how to pay the rent. Air mattresses were rented out by Chesky and one of his co-founders to random people attending a design conference in San Francisco.
They discovered they had a workable company idea after resolving a personal issue. In addition, they resolved a problem for others by enabling guests to stay in less expensive lodging options than hotels.
Although it may no longer be the most affordable choice, Airbnb helped establish the modern sharing economy with businesses like Uber. As of Wednesday afternoon, its market valuation was $77.04 billion.
Put differently, it is not always necessary to create a novel product in order to achieve success. Higgins advised paying attention to your environment and considering the repeatability of the solutions you come up with for common issues.
A recurring subject in entrepreneurship
Chesky is not the only noteworthy case to be studied; many other prosperous businesses were founded similarly. CEO of Bumble Whitney Wolfe Herd noticed a common discontent in individuals around her and decided to establish her dating app, where women start all interactions with matches.
She stated on the Bumble website in a 2020 letter, “I saw a problem I wanted to help solve.” “So many of the lovely, intelligent women I knew were still waiting for a man to approach them about dating… Despite the progress women had made in the profession and in the halls of power, the gender norms around courtship and dating still looked so archaic.
The strategy is also effective for smaller companies. Two coworkers believed they could create a better-looking and more durable frying pan, and as a result, they launched the cookware company Hexclad, which is funded by Gordon Ramsay. Make It was told last month by CEO Danny Winer.
IT industry Co-founder Steven Schwartz told Make It in August that the idea for Whop, which earns an estimated $354,000 a month, came from a group of teenage friends who realized another software marketplace was untrustworthy.
According to Chesky himself, mentally changing your objective from “create something brilliant” to “solve a problem” can be quite beneficial.
We couldn’t have come up with a good concept at all if we had attempted to think of one. It is believed that he stated, “You just have to have a solution for a problem in your own life,” at a 2015 speech at New York University.
In a 2016 interview, Mark Zuckerberg, the CEO of Meta and co-founder, agreed, stating that most Silicon Valley founders construct businesses “backward.” At the time, Altman was the president of startup accelerator Y Combinator and is currently the CEO of ChatGPT maker OpenAI.
According to Zuckerberg, “people frequently decide they want to start a company before they even decide what they want to do.” “The most successful businesses are those that aim to bring about societal change,
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