Y Combinator, the biggest fundraising and startup incubator in the U.S., has the motto “Build something people want.”
The challenge is: How do you find out what people want?
Here are three strategies that can help answer this question:
1. Solve a problem you have.
This is a good first simple step. Try building a product or service for yourself, to solve a problem that you have. Now you know at least one person who wants it (that is you).
2. Solve a problem for people around you.
You can explore problems by talking to people around you (friends and office colleagues). You will soon learn about the many problems they have. You can then build a product or a service that solves a common problem.
Using this simple method, you will find a group of people with similar wants.
3. Solve a problem for a “section-slice” of people.
This is where it gets very tricky. A “section” of people means people with similar problems—so their wants will be the same too.
For example, people wanting to learn programming and software development—now this is a “section of people.” If you know programming, can you offer them training? Of course you can. But, you wouldn’t because there are so many online and offline courses that already offer what this section of people wants.
So, now you need to start “slicing” this section.
One section-slice would be people wanting to learn programming in your geographic location. If there are already many programming courses in your area, the business-to-market servicing this section-slice is very thick, and therefore the section-slice is of little use.
Let us then move on to another section-slice. Look at people wanting to learn “machine learning” or “data science” programming. These are fairly new technologies, so chances are there wouldn’t be as many classes around.
However, you also need to look at the number of people in your geographical area that “want” such training. If there are hardly any people wanting to learn machine learning or data science, it is a very thin section-slice.
What, then, is the ideal section-slice?
The ideal section-slice is not too thick or too thin. It’s the sweet spot in between. The section where you have just enough interested people seeking what you offer, with little or no competition.
How much is enough interested people?
It can be ten, a hundred, or a thousand people. It entirely depends on what you have to offer.
Say you want to sell a product/service that earns you $5,000 on each sale; in this case, a hundred interested people would be enough.
If a sale earns you $50,000, then even ten interested people would be enough.
And, if it’s just $50 for each sale, you’d need more than a thousand interested people.
Finding out what people want, and finding enough people wanting the same solution, is an extremely difficult task. Yet this simple and easy-to-understand framework, while not exhaustive, provides a great place to begin your entrepreneurial journey.