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Monday, August 03, 2009

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MuhammadAtt

I would generally be in whole-hearted agreement with everything said here, especially when talking about any sort of enterprise, SAAS, etc. product. Too may pitches get bogged down in what the startup intends to do, rather than explaining to the the VC, why they should care in the first.

Buuuuuuut, to play devils advocate, or just to call bullshit on this whole "problem first" tirade and avoid another smoke-blowing response, it seems like many, if not most, of today's consumer internet companies and tech startups appear to be solutions to "problems" that barely ever existed, if at all.

I mean, what "problem" did Twitter solve? Were people really sitting around stymied by the inability to send messages of less than 140 characters?
What was Google, like the 15th or 20th major search engine on the market?
Why did we need Facebook when we already had Myspace and Friendster?
What would Foursquare's "problem first" pitch look like?: "Mobile users are frustrated by their inability to earn points and badges everytime they stop by the grocery store to pick up a carton of milk?"

Strong problem statement/understanding is crtically are important for some, but not necessarily all.

Bob Yoplait

Well, when Google put in AdSense, they were not solving a problem really, but it looks like a business that made a couple of dollars though

Jan Schultink

It depends on the stage of development your company's market environment. Pitching Twitter 5 years ago versus pitching a new "within 30 minutes" pizza delivery service in New York. The latter is all about pitching solutions...

Joseph Turian

Whenever I would pitch Sanford Dickert an idea, he would always interrupt me and say: "What problem are you trying to solve?" So I learned this lesson real quick.

www.facebook.com/profile.php?id=10603313

Problem: Not enough entrepreneurs know to put the fucking problem up front and first.

Solution: Dave McClure.

twitter.com/colinnederkoorn

Im not currently pitching a startup, but after reading this, I'm going to rework how I describe the company I work for to people I meet.

Sean

Sounds like the SPIN selling approach to pitching a VC!

willo

That was good for me! ;)

Seriously though, great passion & great advice. I enjoyed reading the Dick Principle post you linked to as well: "You have 30 seconds. For the most effective pitch, focus 80% on the problem, 20% on the solution."

Thanks!

Alex

Problem focus or market needs are often forgotten, I agree.
People talk about "customers do not always know what they want" but even then the focus should be on what you solve - the problem, rather than the solution.

By the way, splashing huge fonts, colours orgy, etc. made my head hurt while reading this.
Perhaps some self-criticism about "pitching" the rant is due?

Same could go for some of the owner's presentations posted on this site.

Paul Papadimitriou

Great post, Dave, as usual. Most entrepreneurs are so into their idea, into what they're creating that they sometimes lose focus on why they did it in the first place. It should be what can that solution do for a problem, using your own terms.

If the origin of that idea was not to solve anything, but was just "cool" and "nifty", I'm usually not interested. It's just tech show off. This happened way too much in the end 90s.

Wayne Greenwood

Yep. Most startups in the valley start with technology they find exciting, then look around and ask themselves, "Now, what can we do with this?" The answer to that backwards question becomes the "solution."

It's much less common to find a startup that first identifies a real-world need, performs a rigorous investigation to fully understand the relevant domain & users, then develops the idea and technology that will satisfy the need.

Dave McClure

@JohnT: sorry, you're very very wrong.

to cover just a few:

Canopy Financial helps businesses setup HSAs for their employees, has several hundred thousand paying customers, and is doing quite well financially. i expect it to be one of my best investments.

Mint has over 1M registered users, is the premier personal finance solution online, and has won numerous awards for helping people manage their finances.

SlideShare has over 10M unique visitors monthly around the world, and is the defacto standard for hosting online presentations. i as well as many many others use it to manage and embed my presentations, and various versions of my Startup Metrics ppts have been viewed by over 100,000 people.

in addition to just those 3, most of my other investments have raised downstream capital, and have paying customers. in other words, you're talking out of your ass my friend. i'll match my portfolio against anyone, from either a ROI or customer viability perspective.

John T.

Looking at some of your investments, Dave, I would say that you are easily impressed (or bullshited). Few solve any real problems.

Ken Berger

Spot on, as usual, DMC.

An issue here is most entreps can't separate themselves enough from their offering to take such constructive criticism, at least not in real time and in public. It's like saying their kid is ugly.

But as long as you were rudely interjecting, and telling them to try again, what about instead taking at least one and with their permission, say, "here's how *I* would do it..."?

In fact, such a before and after example as an adjunct to this post might help, eg: "how they said it" vs "the Pitch the Problem way to say it", etc.

Dan Arkind

Hey Dave, I've been irking other entrepreneurs by doing this for years myself. I have one more thing to add. Not only do I insist entrepreneurs explain the problem the address... I ask them to tell me EXACTLY who has it- job title, company name and type, budget (or demographic data for consumer start ups) and stories about how they've interacted with them and how that lead to the solution.

CK

Yes.
Problem: For non-English-speaking web users, e.g. Japan, twenty percent of the Google/Yahoo SERP is in the wrong language. 20% of this prime SERP real estate is utter gibberish, a waste of text colored green. Billions of SERP views have had a 20% handicap, all along.

PM me for solution.

Example Japan SERP

Christine Lu

i'd rather get stuck on an airplane with you than an elevator. at least i can cry in the back and have the flight attendants feel sorry for me and pass me a tissue in the event my pitch was shitty.

i love you. you are awesome.

Janko M

The advice to focus on problem is not only good for pitching.

I was in the dead zone waiting to find next real focus for some project that just got released.

When reading this I stopped without success searching for

"what should now really be the main points/features of the product"

but

"what problems are we really trying to solve"

and this question cleared the water and provided me a direction I can dig in.

categorykiller.info

haha Dave,
i so have your style, won't deal with wasting time, more efficient to be dick, and i probably won't be so nice to point it out like you do here once i'm a vc.

and WTF, the last thing i am going to do is pitch my breakthrough in front of several hundred broken record (heart still goes out to you for trying) freetards when i can build a live prototype and let the results show a solution to your problem that makes you come to me (figuratively).

almost suredone, internet internet internet =)

Chris Yeh

I love it! But the "Solution looking for a Problem" issue is part of a larger entrepreneur syndrome, which is to focus WAAAY too much on his or her own point of view, rather than on the user's (or better yet, the customer's).

John Prendergast

Complete dick, completely necessary, completely true. Now I know why Laura Fitton raves about you. Great post!

Daniel

... but I did really enjoy the post and agree 100% with your direction.

Daniel

I'm sure you enjoyed yourself and a minority in the audience didn't think you were a total dick.

On the other hand, perhaps you got what you were asking for. Which self-respecting would-be entrepreneur pitches their big idea in front of 300 people like that? And which VC agrees to sit and listen?

Jared Goralnick

Amen, Dave. Finding the problem is the first step to recognizing if you have a market. And most people have solutions to a market that does not exist because the problem is just so darn small. I'd love to see them connect emotionally with me on that sort of problem...alas.

I'll be forwarding this around. You can come be an asshole at an event in Maryland anytime you'd like.

Think Twice & Buy Local

Great post. :)

Trying to sell something by MAKING PEOPLE BUY IT simply doesn't work. If you can create need or desire .. then maybe!

rose

wow, that makes perfect sense.

Julien

20+ services are fetching your RSS feed out there and that's 19 too many. 99% of the time they won't get any content. 1% of the time, they're late, because you published that a few minutes ago. Also, they have problems parsing your feed (atom), because it is different from my feed(rss) and from any other out there.

The problem is that everybody is doing something stupid, while really, their should be only service doing it.

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