I mean specialized venture funds exist, which is somewhat close to what you are describing. I think the way you understand startup formation is wrong though. M

I mean specialized venture funds exist, which is somewhat close to what you are describing. I think the way you understand startup formation is wrong though. Most startups are not formed as ways to directly address existing desires or pain points. Most startups are, fundamentally, iterations on existing business models trying to unseat their predecessors through more subtle innovations, riding technology trends, or simply a large war-chest of capital and talent. This isn't a completely accurate view either. You could cite things like biotech which have their own weird dynamics when it comes to startups. Fundamentally, however, I don't think the "market for ideas to solve problems" model works when thinking about startups. Many people have made some variant of this point, and probably argued for other things being the critical factor (e.g "investing in a founder is the most import important thing"). Ultimately, I don't believe there is one single way to think about how to fund companies that will be successful startups. Mostly, I think investors rely on intuition, which is often wrong, but perhaps better than anything else.