Solving the Problem 

You don't have to look far (whethere it be my website or on any entrepreneur website, forum, blogs, Investors forums, or other articles) -  The source of entrepreneurship is building a business around solving a problem. What's the problem? What problem are you so solving? What is the pinch point? ok, ok, ok... We've heard this before so many times, but there's something a little deeper that needs to be understood and respected in order to validate a business model.

There are typically two types of origins on how the problem's "solution" is generated. 

Problem Centric vs. Product Centric

The first is where the focus is on a problem. An individual will observe and accumulate curiosity or even frustration for a problem or pinch point that no one seems to either knows how or motivated to fix or address. "There has gotta be a better way to do this..." This is how millions of inventions come to the marketplace.  We crave it. We need it. We can't do without it. Sometimes we don't realize we are missing it until we have it, but we do want and are willing to pay money for it. There has got to be a better way to mix this cookie dough without cramping my wrist… Blender! ta da!. This is what I referred to as problem centric. 

On the other hand, some people will seemingly serendipitously come up with a product that is so impressive and so amazing, that everyone should beat a path to your door. I'm sure you have seen this many times a better mouse trap, a new exercise machine, etc. The challenge with this approach is that most adopt the "build it and they will come" mentality they believe that the product just means a good sales person and the product will sell." I am interested in it, therefore, millions of others should be too". Although some inventions like the television, iPad or iPhone was groundbreaking and revolutionized humankind, and was needlessly to say, a mass of success. However, it wasn't intuitively a market need - at least to the masses. A few business geniuses, such as Steve Jobs will have a talent for this, but more often than not, it does not work.

Although the ladder can evolve to a viable business, you need to pay special attention to matching the problem that you're solving to who owns the problem. As a close friend and mentor James Chepyha of Foresight Capital shared with me many years ago, his two favourite questions to any budding company; "What is the problem?" and "Who owns the problem?"

If you crack that nut, then you have established that you have a product in the market. Without it you are simply assuming and no investor will touch it. You are uninvestable.

Keep your eye on the ball (the problem)

All products need to inevitably be solution focused. The business needs to be problem centric, not product centric.  if you focus on the problem, you'll catch changes that need to be made. As the problem evolves, so does the solution.

When VHS tapes were the medium to watch movies in the post-theatre market, Blockbuster had the movie rental industry completely cornered. However, with the evolution of Internet and the ability to streaming media in higher volumes, a tiny company called Netflix completely unravelled the business model that blockbuster once had. Once a small company running vending machine that would rent DVD discs at a grocery store, Netflix pivoted with the changing environments to become one of the largest streaming media companies in the world and became part of the transformation movement on  how movies are watched.

I'm sure you could think of a few other Goliath companies that went completely out a bit because they were focussed on their product instead of the solution and we're not paying attention to the signs. Britannic Encyclopedia. Yellow Pages. Nortel. Blackberry. The list goes on and on.

Now, that's not to say all hope is lost. If you have an amazing product, you may find a market for it. Just be sure it completely solves a problem and there is a big enough market for it. If you look at the origin of bubble wrap, it's initial intent, was to be a wall covering, but no one likes bubbles on their wall. Then they try to repurpose it as greenhouse insulation, but that didn't work either. Then a couple of smart fellows at IBM in 1960 while looking around for some material to protect some computers during shipping put two & two together… Bubble wrap! Sometimes all it takes is a pivot to repurpose and accomplishment to find the market.

So as you lay out your business plan, be sure to keep the problem in mind. Put yourself in the position of the user. Ask other users. Lot of them.  Listen to them carefully and empathetically. Does your solution resonate with them? Are they diving across the table and saying "shut up and take my money", or are they just saying "meh...I could take it or leave it".

In other words, is there a substantial market for it? If it's too ambiguous, too small, or too challenging to penetrate, then you don't have a business. Don't forget, some problems aren't meant to be solved, or at least they aren't worth it economically.The typical kiss of death is if the market is too small, too frugal, or too difficult to penetrate. That is definitely a company killer. Some problems just aren't worth solving. Do some realistic and simple math - the total market avaiable, what you think you can capture and your profit margin (There are lots of TAM/TOM/SOM models to summarize this easily). Make sure you understand your market

Conclusion

There will always be serendipitous solutions created that were intended for its final market home that are successful, however, you need to make sure that there is a tight match between what the problem is and who it's directed to. Nothing else matters if he can't solve that.

 thanks for reading and do well.