3 ms·

I like PG's analogy for the first two points - think of your product as a rectangle. One side is how much it improves people's lives (value) and the other is ho

by revorad 15y ago

I like PG's analogy for the first two points - think of your product as a rectangle. One side is how much it improves people's lives (value) and the other is how many people use it (market). The bigger the rectangle, the more valuable your startup. For some products which have high social value, increase in one automatically leads to increase in the other. The last one (having fun) may seem tangential, but in my experience can have a big positive impact on no.1. It's so much easier to keep pushing hard when it's fun. Edit: See point 4 - http://paulgraham.com/13sentences.html http://paulgraham.com/13sentences.html

paraschopra 15y ago
Wow, never thought of this rectangle analogy. It makes so much sense. Value*Addressable_Market = How good a startup idea is.
- davidw 15y ago
  "How good an idea is" should also take into account your ability to do something with it. A small rectangle that you can dominate may well be better than chasing after something huge where you don't really have a way to attack it.
cperciva 15y ago
Side note about the first axis: When you measure how much you're improving people's lives, remember to look at how much you're improving them compared to if people used the best available alternative, not compared to nothing at all. The main selling points for Tarsnap are that it's secure and easily scriptable; for most people those are far less important than "having backups will prevent data loss", but that last property is something which any good backups would provide, so it's part of the ignored baseline.
- revorad 15y ago
  I disagree. You only have to compare your product to what prospective users are currently using. For a lot of products, the most common answers are nothing, email and Excel. It's hard for technical founders to accept that people may choose your product for reasons other than it's the "best". For the user the only delta that matters is quality of life before and after using your product, even if there are ten better products out there.
  - paraschopra 15y ago
    What you are saying is that market doesn't generally have perfect knowledge about alternatives available. How aware is a market depends on what kind of market it is.

by revorad 15y ago

paraschopra 15y ago

Wow, never thought of this rectangle analogy. It makes so much sense. Value*Addressable_Market = How good a startup idea is.

davidw 15y ago
"How good an idea is" should also take into account your ability to do something with it. A small rectangle that you can dominate may well be better than chasing after something huge where you don't really have a way to attack it.

cperciva 15y ago

Side note about the first axis: When you measure how much you're improving people's lives, remember to look at how much you're improving them compared to if people used the best available alternative, not compared to nothing at all. The main selling points for Tarsnap are that it's secure and easily scriptable; for most people those are far less important than "having backups will prevent data loss", but that last property is something which any good backups would provide, so it's part of the ignored baseline.

revorad 15y ago
I disagree. You only have to compare your product to what prospective users are currently using. For a lot of products, the most common answers are nothing, email and Excel. It's hard for technical founders to accept that people may choose your product for reasons other than it's the "best". For the user the only delta that matters is quality of life before and after using your product, even if there are ten better products out there.
- paraschopra 15y ago
  What you are saying is that market doesn't generally have perfect knowledge about alternatives available. How aware is a market depends on what kind of market it is.