startups

the way u do startups is fundamentally flawed. heres what i’ve learrned to try to not make the same mistakes.

the Product Development process goes as follows:

  1. Decide u wanna single-handedly change the world bc ur special like that
  2. Have a prophetic vision of some sci-fi future you would like to live in
  3. Is it feasible to build? What resources/skills would be needed?
  4. Who are the customers, how big is the TAM and how will the product reach them?
  5. How much will it cost to reach them/build, aka how much should we raise
  6. Raise money on sheer willpower and gusto. Assemble the Avengers.
  7. Everyone stops talking and starts working. Eng builds MVP, Sales builds demo material and lines up a waitlist of ppl from trade shows and reddit
  8. Alpha/beta/sigma test the product to make sure it works as intended, and iron out the bugs they found
  9. investors start measuring progress by number of orders in place by first customers and CEO sprints for a FOMO fundraising round of ostentatious preening
  10. Launch with fanfare, PR, and enough marketing spend to feed a village in africa for the next 40 years.
  11. ???
  12. Profit

Unfortunately, your company will die.

Think of every startup you’ve been in or known about. Hasn’t the energy, drive and focus been on getting the product to those beta customers ASAP?

Think about what happens after that first customer ship party is over, the champagne is flat, and the balloons are deflated. Sales now has to find the quantity of customers they claimed it would find. Sure, they may have found a couple thousand beta customers, but are they representative of scalable mainstream markets? Most mainstream market customers tend to be risk averse, pragmatic purchases. See Crossing the Chasm and Geeks, MOPs, and sociopaths in subculture evolution.

While that’s bad enough, these startups are now burdened with an expensive scaled up sales and engineering organization frustrated and desperately creating artificial demand via increasing CAC spend. Meta sells great shovels…

If you’re approaching your launch date with a “ready or not, here we come!” mindset, ur omegafucked. esp bc i already u know overengineered the fk out of the kubernetes autoscaling backend to be ready for hyper-viral engagement. †

the solution is the problem

Before we get into what good looks like, lets draw a more concrete illustration of the above.

Square peg in a round hole illustration

Let’s say you’ve built a beautiful peg - a perfectly crafted solution to a problem you’re convinced exists. The polish on it is masterful and its square corners are cut with such precision a CNC router would be jealous. It’s the exact phenomenological representation of plato’s noumenal square peg. congrats!

Now all you have to do is find a hole it’ll slip into. You search far and wide for this mythical hole, but the holes you find are circular, or triangular, or maybe there are no holes at all.

Or worse - imagine you’re so convinced of your peg’s destiny that you start trying to punch holes into the world that match its shape. You spend millions on marketing, trying to create demand where there may be none, denting a squared circle into reality. pls dont dent me next… (wait actually pls do 🫣🥴)

You built the “perfect” product in a vacuum, optimizing for theoretical perfection rather than real customer needs. You’ve built solutions for problems that don’t exist, or solutions that are technically superior but practically inferior to existing options.

The trick here is that you’re right - that problem did exist. You conceived it, so it must exist right?

But Descartes’ demon lurks: just because you’ve conceived something doesn’t mean it exists beyond your perception. Your experience is real, but is it representative? Is it a market?

The challenge isn’t proving the problem exists for you - it’s proving it exists for others, at scale, in a way they’ll pay to solve.

This is the difference between a DIY at-home tinkering project, and a viable venture scale business.

In fact, a very good peg can fit into many holes. Take a pause here to indulge in schadenfreude.

the problem is the solution

A lot of what i’m going to say is good, isnt just conjecture. Its been studied. And you’ll see it time and time again in the best startups of our generation (stripe, deepseek, spacex, etc).

At the end of the day, it comes down to how tight you can make your feedback cycle.

The tightest wins.

This requires deep customer understanding, having an elite team, and making high alpha decisions. Let’s break down what that means:

  1. Deep Customer Understanding
    - You need to be obsessed with your customers
    - Not just surface level data, but deep ethnographic insights
    - Understanding their entire workflows, pain points, and unspoken needs
    This doesnt happen in an herman miller armchair. This happens with repeating “Why tho?” until they yeet you out the window or hang up zoom (true story).

In a startup no facts exist inside the building, only opinions. -Steve Blank, The Four Steps to Epiphany

  1. Elite Team Execution
    - Product people who can synthesize messy customer signals
    - Designers who can craft experiences that feel magical (maps onto reality in an incomprehensibly Truer way - e.g. waymo, tiktok dopamine circuits)
    - B-tier people hire C-tier people. Do not settle under any circumstance.
    Hire someone better than you, trust them with responsibilities and gtfo of their way.

You cannot solve a problem with the same mind that created it – einstein

  1. High Alpha Decision Making
    - Have a bias towards action, 30% of neccessary information is sufficient - you’ll discover way more along the way
    - Be prepared to kill beloved features that don’t serve the core need when customer feedback indicates a misalignment
    - Prioritize decisions that enhance customer value (practically) and address their core needs (transportation, shelter, love, etc)
    Nothing is more important than to learn the next qualitative impro ment for the customer. In accordance to their taste, not your taste or objective taste.

“Many decisions are reversible, two-way doors. Make most decisions in under 2 minutes” - Bezos + David Allen, Getting Things Done

The Build-Measure-Learn loop is also applicable for navigating the Innovator’s Dilemma and crossing the chasm. The company that executes and generates the most insights, wins. plain and simple.

Build-Measure-Learn feedback loop

You don’t even need to write code/build R&D to improve a product. By simply understanding and addressing the specific needs and perceptions of your customers, you can enhance the customer’s perceived value.

Consider painkillers marketed as “menstrual relief” vs “back pain relief”. Same drug, different packaging (pink vs black), higher price for the “female” version (obv… 🙄)

Because the messaging shows deep understanding of their specific pain – when customers feel truly seen and understood, they’ll pay a premium - even for identical solutions. The competitive edge isn’t always in the product, but in how well you understand the problem.

This isn’t about being exploitative - it’s recognizing that empathy and understanding add real value. The solution can be standard if the connection to customer needs is premium. What’s especially fascinating is that research shows placebos are actually more effective when patients pay more for them and when they believe the treatment is specifically designed for their condition - the price and personalization themselves become part of the therapeutic effect. win-win?

To move faster, set the timeline sooner. This will force you to do only the things needed to succeed. Sam Altman will ask “can you add another zero in a year” and thereafter “why can’t you do it in three months,” likely inspired by Thiel’s Zero to One, where you challenge your 10-year goals by asking, “how can I do this in 6 months?”. Sama offers five methods you can do things aka leverage: delegation, capital, brand, network, and technology. This will look different for each company but ifykyk.

tldr (chatgpt summary for those who were just gonna copy paste and ask for a summary)
In conclusion, the success of a startup hinges on its ability to deeply understand its customers, build an elite team, and make high alpha decisions. By maintaining a tight feedback loop and continuously iterating based on customer insights, startups can navigate challenges and seize opportunities more effectively. Remember, the competitive edge often lies not in the product itself, but in how well you understand and address the customer’s needs. Empathy, understanding, and a bias towards action are key drivers of success. Set ambitious timelines, leverage available resources, and always prioritize learning and adapting to deliver real value to your customers. The journey of a startup is fraught with uncertainties, but with the right approach, the rewards can be immense.

Appendix

† 1

There are exceptions to this. For example, if you discover the cure to cancer, they will literally be dying to use it. Or if you think you can build a better product than AWS and just copy their existing functions, add a schmexy GUI and lobby the CISOs to swap to ur product bc its free. But for most startups, “build and they will come” is not a GTM strategy. its a prayer.