@andrewchen

Subscribe · Featured · Recent · The Cold Start Problem 📘

Why do people avoid checking their assumptions?

The venerable Chris Yeh recently remarked on an entrepreneur that DIDN’T want to verify his assumptions:

Whenever someone comes to me with an ecommerce idea, I tell them to sell some of their stuff on eBay and let me know about the results.

One entrepreneur actually refused to do the experiment. “Chris,” he said, “I might learn that my idea sucks. I’d rather not know that until after I’ve raised my money.”

I think he was missing the point. I’m sad to report that the business failed.

Now let me confess why someone might do this, as someone who did EXACTLY this several times in a row for different projects. I think the ultimate reasons come in a bunch of different flavors:

5 Deadly Sins for Blind Business Creation
1. “I’m smart, I know this will work.”
2. “I’m introverted, and I like the technology more than the people.”
3. “I’ve spent too much time building already, I’m afraid of the results.”
4. “I think we should build all of it first, then figure out if it works.”
5. “I’m dumb, I don’t know what assumptions to verify.”

Any of these sound like you? If so, you might be in trouble :) In almost all the cases, I’ve mostly been guilty of #2 and #4. I enjoy tinkering, and that coupled with an overly-structured approach (waterfall??) to problems leads to a blind approach to major problems. This is an area I really came to identify and accept over the last few years, and it’s been very helpful.

Anyway, let’s break this stuff down.

1. I’m smart, I know this will work.
If it’s consumer internet, no you don’t. In fact, being smart will make it harder to relate to most people in the world, who are by definition average. All the time you spent trying to act and sound smarter (and more logical) will bite you in the ass. Seriously.

The big risk is how OTHER people think, and no matter how logical it is for them, it’s up to you to design something that works for the people, not the other way around.

2. I’m introverted, and I like the technology more than the people.
This one comes down to what you’re trying to do. If you don’t like people, and don’t want to design for real, live customers, then you’re not really doing a startup, you’re doing research.

You can either handle this by trying to fight it, maybe by appointing a less-introverted co-founder the task of talking to the target customer and building/relaying a persona. Another option is to go find someone who is in your target market to work with you, in which case you’ll talk to your customer every day.

3. I’ve spent too much time building already, I’m afraid of the results.
I’m not even going to address this one :) Get over it, quick.

4. I think we should build all of it first, then figure out if it works.
For the really organized, structured people of the world, they prefer to think in terms of top-down innovation and delivery, rather than letting innovation grow like weeds. How Microsoft of you :)

I’ve gotten really comfortable with this by relating it to the pharma world – you start with 100,000 compounds, and you narrow this down to 1 drug and 99,999 failures. If you accept this as a normal part of the process, then you can start thinking of pushing out prototypes on a weekly basis (prototypes can be powerpoint or paper or whatever, not just code)

5. I’m dumb, I don’t know what assumptions to verify.
Try. Fail. Try again. Fail again. Eventually you’ll learn. Read books and talk to people too!

PS. Get new updates/analysis on tech and startups

I write a high-quality, weekly newsletter covering what's happening in Silicon Valley, focused on startups, marketing, and mobile.

Views expressed in “content” (including posts, podcasts, videos) linked on this website or posted in social media and other platforms (collectively, “content distribution outlets”) are my own and are not the views of AH Capital Management, L.L.C. (“a16z”) or its respective affiliates. AH Capital Management is an investment adviser registered with the Securities and Exchange Commission. Registration as an investment adviser does not imply any special skill or training. The posts are not directed to any investors or potential investors, and do not constitute an offer to sell -- or a solicitation of an offer to buy -- any securities, and may not be used or relied upon in evaluating the merits of any investment.

The content should not be construed as or relied upon in any manner as investment, legal, tax, or other advice. You should consult your own advisers as to legal, business, tax, and other related matters concerning any investment. Any projections, estimates, forecasts, targets, prospects and/or opinions expressed in these materials are subject to change without notice and may differ or be contrary to opinions expressed by others. Any charts provided here are for informational purposes only, and should not be relied upon when making any investment decision. Certain information contained in here has been obtained from third-party sources. While taken from sources believed to be reliable, I have not independently verified such information and makes no representations about the enduring accuracy of the information or its appropriateness for a given situation. The content speaks only as of the date indicated.

Under no circumstances should any posts or other information provided on this website -- or on associated content distribution outlets -- be construed as an offer soliciting the purchase or sale of any security or interest in any pooled investment vehicle sponsored, discussed, or mentioned by a16z personnel. Nor should it be construed as an offer to provide investment advisory services; an offer to invest in an a16z-managed pooled investment vehicle will be made separately and only by means of the confidential offering documents of the specific pooled investment vehicles -- which should be read in their entirety, and only to those who, among other requirements, meet certain qualifications under federal securities laws. Such investors, defined as accredited investors and qualified purchasers, are generally deemed capable of evaluating the merits and risks of prospective investments and financial matters. There can be no assurances that a16z’s investment objectives will be achieved or investment strategies will be successful. Any investment in a vehicle managed by a16z involves a high degree of risk including the risk that the entire amount invested is lost. Any investments or portfolio companies mentioned, referred to, or described are not representative of all investments in vehicles managed by a16z and there can be no assurance that the investments will be profitable or that other investments made in the future will have similar characteristics or results. A list of investments made by funds managed by a16z is available at https://a16z.com/investments/. Excluded from this list are investments for which the issuer has not provided permission for a16z to disclose publicly as well as unannounced investments in publicly traded digital assets. Past results of Andreessen Horowitz’s investments, pooled investment vehicles, or investment strategies are not necessarily indicative of future results. Please see https://a16z.com/disclosures for additional important information.