How to Validate Meaningful Problems for Your Startup with Ben Yoskovitz

Hey everyone, how's it going? My name is Eyan Isaacs, I'm the head of global growth for the Founder Institute. Thank you so much for joining today, we have another, I say this every time, but like honestly, like every time we have a great speaker, I gotta give them, give our team props, but like we have another amazing session planned for our weekly global webinar, for those who are dialing in, sometimes it's in the morning, sometimes the afternoon, sometimes it's night, I'm based here in Dubai, UAE, it's nighttime for me, so I appreciate everyone taking the time out and joining us. We'll get started here in about a quick minute. I just wanna go over some housekeeping rules. First thing is that there's, you can see there's a chat icon on the right-hand side. Please use that to communicate with us. I see some people already putting in some information. Let us know where you're coming in from. I see Montreal, Houston, Luxembourg, Florida, Minneapolis, Amsterdam, Israel. So pretty cool. We had over 750, it might be even 800, I haven't checked, like about an hour ago, sign up for this event. We were expecting close to 300 people live. So we'll take a minute here just until everyone gets set up. But yeah, thank you so much for joining. I'll let Ben introduce himself shortly and talk about like his background. If you don't know who Ben Yaskowitz is, like, you're in for a real, real treat, and I'll talk a little bit about that. But another housekeeping item is you can see underneath the chat icon, there's a Q&A button. Please use the Q&A button to ask questions that are directly for Ben during the— towards the end of this event, or sorry, after his presentation, we'll do a Q&A portion. We will use that kind of function to feed us questions because then I can bring it up on stage and we can discuss it. The last thing is you'll see some emojis at the bottom of your screen. Please use the emojis to react to the content that's being shared, and that will give everybody a good idea. Yeah, thumbs up, hearts, and all that type of stuff. All right, I think that's it from housekeeping items. We'll get started. We have 307 people live here. Everyone's here to hear Ben speak. Before we kind of get things started, I want to give a little bit of a backstory around Ben. So like I said, my name is Ehan. I'm actually an FI graduate from the Toronto 2016 chapter. So Ben was one of my mentors, right? I don't want to get into all the details, but I heard Ben speak and I'm like really honored, like he got— he accepted this invitation. I'm like really, really thrilled because he was one of those few mentors that actually changed the way I thought about business and about my startup idea. My startup idea at that time was like an edtech platform trying to link different courses, kind of like a Udemy but for like locally physically offered courses. So I was at FI working on this, grinding day in, day and night. I heard Ben speak, he gave a very inspiring talk. I'm like, I want to speak to this guy. Took me 7 emails to get in touch with him because he was traveling. And then finally, let me just share my screen so people can see it. He finally responded back with like, okay, call me at 1:00 PM. And I was like, oh my God, okay. So I dropped everything and I called him and like we had this 15-minute call. This was November 5th, 2016. Yeah, I think I got this 5 in the, like, I don't know, time zones got messed up and stuff. I spoke to him and literally in that 15 minutes he changed everything in the way of how I operate. He's like, who's your customer, B2B or B2C? And I'm like, I think B2C. He's like, no, you're B2B. And then he's like, what's your value prop for B2B? And I was like, I went through a regular spiel. He's like, no, your value prop is that you will do marketing 10 times better than everyone else, and you'll follow the same Airbnb and Udemy model, because that's the way it works. Like he got the idea straight away and stuff like that. So the reason I share that is because Ben's great at what he does. I really encourage you to like disconnect your phones and just dial in and listen to what he has to say for the next 15, 20 minutes, and then we'll go to questions. With that being said, I'm gonna bring up Ben on stage. Hopefully he can talk a little bit about more what he's been up to and we'll kind of go from there. Hey, Ben.

Hello, thank you. I thank you for saying, by the way, that it took you 7 tries, not because I was ignoring you, but because I was, you know, actually busy and traveling and doing things. So it's not like that trying to be— founders that are reaching out. So I appreciate that.

No, I appreciate you taking the time. I guess before you start your presentation, let's do a quick poll just to get a good flavor of the room. So everyone, I don't know, Ben, if you see the result of the poll, but like, yeah, for everyone, if you could just quickly add what exactly your biggest struggle is when it comes to finding a problem, that should give Ben a pretty good idea of who our audience is. Okay, I feel like it's a decent split, but you have quite a bit of people, if I go, okay, does that give you a good idea, Ben?

I didn't see, I don't see the results.

Oh, okay, sorry. So I had the poll on stage, it says 35% is finding people to talk to, 27% is testing users quickly, and 16% is building an MVP, and 20% is raising money. So the vast majority is saying that finding people to talk to is their biggest challenge.

All right. Well, it's good. Yeah, that's great. It's good to hear that people are at a very early stage with this because that's really what I'm going to focus on is the early stage of startup ideation, finding problems that matter. So thanks for having me. It's great to be here. Always enjoy doing this and sharing with folks. I won't go into a lot of detail on my background because it's just, it's It's a waste of time, but you can find me on X, you can find me on LinkedIn. My newsletter, which I started end of last year, finally got me back into writing called Focus Chaos. If I can ask everybody or anybody who's interested, please subscribe there. The topics vary. A lot is about venture studios because that's what I run. I started a venture studio back in 2016 called Highline Beta. Which is about building and funding companies from scratch. But I also talk about product management, entrepreneurship, analytics, and other things. So I hope folks will subscribe to that. But I wanna jump into this because there's, I tend to put a lot of content into these things, try to get out as many ideas as I can and share as much as possible. So number one, building things people don't want is incredibly painful. And I've experienced this in 2007. I started a company called Standout Jobs in the recruitment space. You know, we didn't understand the market well enough. We didn't understand how HR people buy things. We really did not dig in deeply enough. And we built this thing, we raised capital, we released it, and it was sort of like tumbleweeds going by in an old Western. And so if you've ever done this where you've spent a lot of time and money and energy building something and you don't get the results you need, it's such a painful experience. You never want to go through that experience again. And so I spend a lot of time at Highline Beta working with founders trying to avoid this and trying to avoid wasting time and money and really trying to identify problems that we can actually go solve. In order to do that, we have to understand what a problem even is. So I'm starting at sort of a basic because we can all inherently understand what a problem is. We've tried to break this down into individual components, not because there's a perfect formula or playbook for this, but to give you a way of thinking about this. So the way we think about a problem at Highline Beta is this: you have to have a user, you have to have a need, and you have to have an insight. And I'm going to go into each one of these and talk about what these things actually mean. So for starters, you need a specific user. And I say on the slide, the narrower the better. So the user is a specific person, not a generic group. So if you are selling something to women, women is not a user. It's too big an audience. There's too much diversity amongst women or men. Moms, not a group. It's narrower, but it's still too broad. And when you think about B2B, a lot of startups make the mistake, oh, I'm selling to a business, but you're not selling— small business is not a user. We can't even define what a small business is. People can't even agree on what a small business is. And businesses are just groups of people. So you have to find a narrow, narrow group of users. So that's number one. Who has the pain? That's what we're looking for. Step 2 is finding a need. And when we talk about need, typically where we start is a functional pain point that they have. These are easier things to identify for people, which is where in their lives is there a problem? Is there friction? Is there something that they're doing already with a hack that's difficult for them to do? And you think you can solve this more effectively. So we have a user, which is a very specific group of people or person that you've identified. We have a functional need, and then we're looking for an insight. And an insight is somewhat difficult to define, but I think of this as the aha. An insight, if you actually uncover one through the research that you would be doing to find a problem, it actually can become a competitive advantage. You can build an entire business around some insight that you have identified that is not obvious. Insights are not obvious things that we all can Google and look up. Insights are things that you've really uncovered that are ahas. They're special. They're unique to the work that you're doing, and you can wrap your value proposition around that, your go-to-market around that, your pricing, the features that you build, all baked off of a single insight. Now the reality is that finding insights is really, really hard and it takes time. And so when we think about starting this process of finding an idea or finding a problem to go out and validate, we like to keep insights in the back of our minds, but we don't start by saying, if you don't have an insight, you can't keep going. That's— otherwise you'll just be caught researching forever. So instead, what we do is we change that to deeper needs. So we say we need a user, we need some kind of functional need, right? There's some behavior that people are doing or not doing that you think can be improved. And then we're going to go look for a deeper need or a tension that exists. And when we talk about a deeper need, what we mean here is something social or emotional. So again, even in a B2B context, you say, oh, I'm selling workflow automation software to the construction industry, and it sounds a little bit on the dull side, maybe it's very technical, but the humans that are buying that software from you, the humans that have those pain points, they have emotions and they have social things that are going on in their work. Maybe they're looking at buying your software because they think it'll get them a promotion. Maybe they're looking to do that to hit their own targets. So you have to dig in deeper than just a functional need. That's not enough. To really find a problem that actually matters. We need to find that underlying social and emotional things that are going on with humans. And if we can find that, then we can really go solve the problem in an effective way. Now, the other thing I will say here is that everything that you map out for my user, my need, my functional need, and my social and emotional need, these are all assumptions. And it's really important to understand that you have to go and now test all of these variables. So an assumption very quickly is really something you believe to be true, but you have to go prove that it's true. And this is where we start to talk about experimentation and testing and scientific method. And I'll talk a little bit more about that in a moment. But often when I see a mistake that founders make at the very early stages, they say, well, I know who I'm targeting. It's this group of people. I know they have this need. I'm not sure about this deeper need thing, but I don't even— I'm not even going to worry about that. But look at this. Look how slow this process is in a spreadsheet. Surely I can build something better and faster than a spreadsheet. Why are they doing it that way? And all of that, everything I just said is an assumption. I don't know if it's actually true. I don't know why they're still using a spreadsheet. Maybe they're very happy with it. Maybe they're scared about switching to your AI-powered whatever it is. And so you have to really not lock these things in, but instead go and test them individually. All right. And so really what this comes down to is that your job is to find the truth. And so again, a lot of founders will not do the necessary digging and research to actually uncover what is going on. They might see something happening and say, well, I can make that better without really understanding why it's even being done that way. And so your job, again, I always think is just like a detective, just go and find the truth and dig and dig and dig until you can piece together who are these people, what is their functional pain point, and why the heck is all of this going on in the first place? If you don't have that why, there's a good chance you're gonna build something that maybe solves the functional problem, but doesn't get the kind of traction you need because you don't understand understand the other aspects of what's going on. And one thing I would warn you about is beware of universal truths. So a universal truth is— the way I think about this is it's basically something we all understand for the most part. So again, I mentioned Standout Jobs back in 2007, started this company in the recruitment space. The universal truth in recruitment is that hiring great people is hard. That is true whether you're one of the coolest, most exciting companies in the world. It's true whether you've just raised a lot of money. It's true if you're a boring or mediocre company. It's true for literally every company on the planet. Hiring great people is hard. That is what we would describe as a universal truth. And so when we were doing Standout Jobs, we saw that. We said, well, recruiting is hard. We're going to build a solution to fix that. But there's an enormous amount— there's an enormous number of gaps from a universal truth to coming up with a solution that solves a problem. You can't solve recruiting is hard. You have to dig much deeper than that. People should exercise more is a universal truth. We all understand that. Generally speaking, there are some people who exercise a ton, but generally speaking, people should exercise more. People should eat healthier. And yet lots of people don't eat that healthy. Lots of people drink alcohol. Lots of people don't exercise. These are universal truths. So you say, I'm going to build a solution to help people exercise. And then you come up with a random solution to that. It's an app, it's a whatever it is, it's a new Peloton. It doesn't matter. And nobody uses it. And that's because you went from this gigantic universal truth that everybody can see to a solution and there were a myriad of steps along the way where you didn't really understand the user, you didn't really understand their functional need, and you didn't really understand why these things aren't happening. Why aren't they exercising? Why aren't they eating healthier? Why do they fall off the wagon? So again, you have to be careful. And I see this a lot in pitch decks. There's a huge problem. This thing is inefficient. Okay, I don't disagree with that. We all see it. But why is it like that? And your job in finding the truth is to uncover that. And so the way to do this is through research. And research drives— and there's other words for it, customer development, customer discovery— research drives empathy. Empathy is not the sense of caring for other people. Although caring for people is important, empathy is understanding people. I can look at a problem and care for somebody who's in a situation that I think is unfortunate. Caring for somebody is different than really understanding what the heck is going on with their lives, work-wise, personal, or what have you. So when we think about research, I've kind of broken it up. And again, this is— I guess this is recorded. I can share slides with people after because there's lots of links to stuff I've written or other people have written. Number 1 is you do have to get really good at finding people to talk to and talk to those people. I'm sort of interested in the poll that a lot of people said they're struggling to find people to talk to. Sometimes it can be hard in certain specialties. I'm looking for a very particular expert that runs a certain size, you know, a dentist that runs a certain size dental clinic in the southern United States. That might be hard to find. Although I think you would just basically go on LinkedIn and hustle to find those folks. But number one is you have to get good at interviewing people. And this is a skill like any other skill. Talking to Humans is a— it's an ebook by an author by the name of Giff Constable. It's an awesome, super quick read. You just have to come up with a basic way of doing open-ended interviews without leading questions. and then start to collect that information from people and synthesize it into what might materialize into insights. Generally speaking, for me, if you have a new idea or a problem you're exploring, I always say start, try to talk to 10 people. And if in 10 people you hear no patterns, you have to reevaluate. Am I speaking to the right people? Maybe I was missing the mark on the things I'm talking to them about. But if you start to hear patterns amongst 10 people, you might be onto something and it warrants digging further, maybe getting more precise with the people you interview or the questions that you're asking or moving to what I think is often the next stage for me, which isn't going rushing out and building a product. So we don't get, you know, we don't talk to 10 people and then say, I know the answer, let's go. Because most of those interviews are what I would call problem interviews. We're just trying to understand a day in the life of this particular person. Where is the pain in their lives? We're not trying to sell them a solution. The next step is what, what I, what I think of as stimulus concepts and prototypes. So this can be very low fidelity. You've heard of probably paper prototypes before. It could be even lower fidelity than that. It might be a card sort exercise that you're doing. It might be something that you're scribbling on a whiteboard with a potential customer. It's just stimulus is anything physical. Could be in a digital format, but something physical that people can interact with. In my experience, when you're interviewing somebody, on occasion they can be guarded in how they're communicating with you. As soon as you give them something to muck around with, a piece of paper, some sticky notes, a clickable prototype, they start to open up more. And now you're able to ask them interesting questions while they're mucking around with whatever it is that you've built. And built here doesn't mean coded. So anybody can do this. By the way, clickable prototypes can be done in PowerPoint or Google Slides. So you don't even need to be using anything more sophisticated than that. But this is that phase after I've interviewed some people and say, okay, I'm hearing some things. I wanna build some kind of stimulus or prototype or a concept test to start testing more specific hypotheses out of what I've heard in my initial sort of very open-ended problem interviews. And then this third sort of bucket here, what I call applying the scientific method to startups without being a zealot, is really just about the rigor that you use to run experiments. So you, you do some initial interviews with people. These are very open-ended. You start to hear some things there that leads you to some new assumptions or hypotheses that you might have. And for each assumption that you have, you think, how can I test this assumption? You might be able to build something to do that. Again, could be paper, could be something very lightweight digitally. And now I'm using a rigorous— it's not totally the scientific method because that's a very rigorous way of validating or invalidating hypotheses. There's always too many variables, but it's this, this idea of experimenting quickly over and over again to increase the cycle time of learning. So really, at the end of the day, this— how do I find a problem? It's interviewing people, it's interviewing people with concepts, it's using prototypes and low-fidelity tools that I can quickly put out there and try to drive as much learning as possible. And one way that we like to think about this is through this concept of desirability, viability, and feasibility, which really comes from the design thinking world. And this— we use this as a framework at Highline Beta all the time for identifying and assessing uncertainty. So, you know, what are my assumptions? I have a list of these assumptions, and each one of those is going to be a desirability assumption, a feasibility assumption, or a viability assumption. Most of the time, people love to rush to the feasibility stuff, which is, I just want to build something and put it in people's hands. And to be honest, sometimes that's what you have to do. You can't overanalyze things. But when we focus on feasibility too quickly, we often forget desirability, which is, do people actually want this thing? Do people actually care? And then sometimes we focus too much on viability, which is does the business model make sense? So if you've ever done a business model, you know, on a spreadsheet and you've mapped out in 5 years we're gonna make $50 million, $100 million, we're gonna be rich, it's gonna be amazing. Usually at this stage, that's a complete waste of time 'cause it's all fabricated, basically nonsense based on really, really, unvalidated assumptions. It's not that I don't wanna understand if the business can make money and has the potential of scaling, but at such an early stage, viability is usually not where we focus. So it's usually on the desirability side. Now again, I don't wanna focus only on desirability because sometimes what happens is you find a problem that people have. You've identified a group of people that have a problem, you understand it, and you realize you can't actually build a business off of it. So although desirability takes the lead here, we are looking at feasibility and viability even at a very early stage. Feasibility— can we build it? Usually yes, but there might be legal or compliance or regulatory things that we have to understand. And then viability— do we think this thing can make any money? What might that look like? Can we test that before we actually go build something? Which you can do. There's lots of ways of testing somebody's willingness to pay before you even commit to building. So you look at all 3 of these at the same time with more of a focus on desirability upfront. Now, I wanted to share this. And again, I did this interview with this entrepreneur. His name is Samir Dhar. And Samir has this incredible story. And I won't go through all the details of the story, of course, but he built a company in the elder care space around incontinence. And then he exited that business. I think it was in about 2016. He worked for the acquirer for a couple of years. And then when he left the acquirer, he said, I want to go back into this space because I've learned even more about it and build another business in the age tech or elder care space. And he went and evaluated over 15 ideas through interviews, through market research. Again, DVF really applies. And he actually shared all of this in a Google spreadsheet. So anybody who wants any— first of all, anybody interested in elder care, by all means, you know, you click that link or you can go to my newsletter and you can find it. But what's amazing about what Samir did for his first business is he lived in an elder care facility. So, you know, that's taking empathy to a whole other level. I want to build something to help older people who live in a retirement home. Sure, like I know what a retirement home is, but, but this guy actually lived in one for a long amount of time so that he could learn very intimately from these people what the problems look like, from the nurses, from the care providers. And then when he built the solution and started prototyping something that people could use, he was getting instant feedback from people 24 hours a day. So this is going all in. It's not looking at a problem superficially and saying, oh, you know, I can see this problem is pretty obvious, I'm going to go and solve it. This guy lived inside of an elder care retirement facility, which blew me away, and then went and looked at 15+ more ideas and actually invalidated all of them before he went and invested in them. And that's taking a rigorous, really deep and thoughtful approach to validating a problem. A couple of other quick things I'll leave you with and then open it up for questions. I said this earlier, a narrow user, because I really believe you've got to find, you know, that sweet spot of who really cares about this thing. Sometimes what that leads to is what people feel is a small market. I am completely a fan of that, and so I always suggest focus on a narrow market first. You may have heard of TAM, SAM, SOM. Total addressable market, serviceable addressable market, serviceable attainable market. These are just ridiculous acronyms. But most of the time when founders are pitching, they're showing me, they're showing a gigantic TAM. Look at my TAM, it's billions and billions of dollars. It's usually like, I'll give you an example. So I wanna build some kind of software to solve problems in B2B in marketing. And so someone will look up the MarTech marketing technology industry and they'll say it's worth $30 billion. Therefore, that's my TAM, which is at scale, I can be worth $30 billion, which is absurd because I'm only solving a sliver of a problem in a gigantic industry or vertical. And so I much prefer not thinking about these gigantic and ridiculous TAMs, even SAMS or SOMs, and say, I found this narrow group of people. Now, not 10. If there's only 10 people on the planet that will ever buy your thing, it better be very expensive to buy. But a narrow market, a vertical that you can dominate and own is much more powerful than saying, I'm gonna build something and conquer martech, which is just silly. So again, a lot of investors will ask for TAM, SAM, SOM. A lot of accelerators will say, what's your market size? I'm not suggesting don't go through a market size exercise. I'm suggesting it doesn't matter because you barely know what the hell you're building, what you're pricing, how you're going to market. We're still trying to figure out what the actual problem is. So market size to me is just not the priority at this stage. The other thing I would say is that you should look for boring problems. Universal truths tend to lead to people trying to solve exciting, trendy problems, hot problems. Let's say— I don't know what the right word is. Trendy is a good word to think about. Oh, everybody is hot on this. We're going to go into that space and solve problems there because that's where everybody is excited. I would prefer to go completely in the different direction. Solving a boring problem for me means finding a completely underserved vertical or market or industry or customer, understanding them incredibly deeply, and solving their problem. If you come from a vertical or an industry that is already underserved, you are very well suited to this. I, I am always excited to talk to founders who are like, you know what, I work in this industry vertical You may have never even heard of it, but I've been in there for 5, 10 years and I keep seeing this recurring problem and I'm pretty sure we could solve it this way. And I already know 50 customers that would buy it from me. I'm like, that's a business. That's the business that I wanna invest in as opposed to the person who comes and says, I've got the latest greatest thing for this industry where there's billions of dollars being flooded. Everybody can see the problems. Everybody is building companies in that space. And so look for boring problems, underserved, that might actually be solvable through easier technology as well, where you don't have to be on the crazy cutting edge of tech to solve a problem and create value. And then the last thing I'll share is this. So, you know, while I'm suggesting doing a fairly significant amount of research, and learning, uh, but, you know, to find a problem that matters before you commit to something, recognizing that if you build a startup and it works, it's probably 5 to 10 years of your life. So you better pick something you really care about. If it doesn't work, it could still be 3 to 5 years of your life. It could actually even be longer. I've done— I've worked on things for 2, 3 years that have failed, and then it It's not a waste of time, but it sure as hell feels like it. So you have to, while I'm saying do all this research, you have to move insanely fast. And this is the two things I would say. Cycle time is the frequency by which you build, measure, learn, which is a key concept of Lean Startup. The more you go through this cycle of, build, by the way, could be an interview, right? I measure, I learn. It could be a prototype, I measure, I learn. Eventually it could be an MVP. I measure, I learn. The more frequently you go through this, the higher, the more learning you end up with. And that helps you reduce uncertainty and risk. The more learning, the higher the chance of winning. It's just as simple as that. Everything you're doing here is an exercise in learning. And that doesn't necessarily change that much as your business scales. Of course, there's sort of more execution because you're finally figuring things out that work. Which channels work? Which types of customers work? My pricing? And then it does shift into execution, but we never lose our enthusiasm or rigor for learning because the frequency of learning is actually the thing that unlocks the answers to win. It unlocks the insights, it unlocks the pivots that we should take. And so just think about, I've got to do a lot of research. I got to really understand what the hell I'm getting myself into, but I got to do it super fast. I'll stop there. I'll stop sharing and thank everybody for listening and I hope that was helpful. Please check out Focus Chaos and we'll open it up to questions.

Thanks so much. Every time we do these sessions, just so you know, we have 485 people live right now. We were at about 512. A lot of, yeah, a lot of folks logged on and we got a ridiculous amount of questions. So folks, on the Q&A button, you can click the upvote button and it will help me prioritize the questions. So I'm gonna bring up the first one. This is by Nitin from Fair Oaks, United States. He's asking, if you have a passion for helping people who are struggling with things similar to yourselves, how do you do your core market research and narrow down the problem you want to solve? I know your last couple slides you talked about finding boring areas and like really, really getting specific with your ICP, but is there anything for the audience apart from the framework or is there another framework you want to suggest on like how can they really go and dive deep into this? I have one suggestion, but I'll say it after your response.

Yeah, I think there's a certain advantage to solving your own pain point. You'll see a lot of folks will say, you know, go out there and build a company around your own pain point. And I think that there is an advantage to that, which is I already understand the pain, but I definitely want to validate with others that they share a similar pain. And so my only suggestion there is give yourself the time to take a step back from what you think the answer is and be open-ended with how you engage those those people who might, you might believe have a similar problem to you, but be open-ended. Don't lead them to say, you have this problem, right? And they're like, yeah, okay, I guess this guy wants me to say I have this problem, so yes. And then you feel vindicated in your own sense of the problem or your own assumption. So I like the idea of going and scratching your own itch, but I also wanna get as much genuine feedback from people. You may also be able to, you know, do like more quantitative-ish testing, build a landing page with a value prop that you think would resonate, drive some traffic to that, see how that converts. But you're not just looking at the conversion data. You also want to collect emails so you can talk to people. So there's, there's ways you might move to solution testing without actually testing a solution.

Great. The only thing I would add to that is it's a good exercise to do is like some folks like this, some people don't, but I think it's a good exercise, at least mentally, or to do with your team, is trying to do positioning statements. April Dunforth, who is another mentor at F5 that Ben also knows, she has some great templates available online, go look her up. And like, just thinking about how do I fit my company in this one small sentence is very, very tough, but it helps you define your ideal customer, or your ideal prospect pretty well. So I've always come, gone back to that. I'm like, okay, what would April or Ben do and how would they define this?

Yeah, yeah, yeah, for sure, 100%.

Uh, all right, so I like this question from Pooja. Um, when it comes to, uh, problems that matter, so when it comes to solving problems, do you suggest to focus on one functional need and how do you define such a need? Uh, does it have to be quantified? So you talked a little bit about this in the previous question, but maybe let's dive a bit deep, especially like considering this is early stage companies and early stage founders, they're really going after that one feature, one product type of thinking, or that very lean MVP. So like, yeah, would you encourage them to think about needs and features and all that type of stuff?

Yeah, what I would— so I would say, um, the short answer is ideally you do find one functional need. But you might not necessarily know what it is at the very beginning. And so again, you would go in and say, you know, I'm interested in solving problems for this vertical or industry with these specific group of people. So I'm going to ask them more broadly about a range of problems or challenges they have. I always like to think about a day in the life of my potential customer and where are things difficult for them. So there may be multiple functional needs in there. And then you do have to do a little bit of a prioritization exercise on that. So that can be done in a few different ways, right? You could put a few different concepts in front of somebody with different value props that address different functional needs and just see which one they engage with more or which one they're like, yeah, this problem I want to learn. You know, what did you mean about this, Pooja? You know, and then you sort of see how they engage with that. It doesn't, in my opinion, it doesn't have to be quantified. I think in the sense of how you're asking the question, like, do I have to run a survey of 1,000 people with a statistically significant amount that tell me this problem matters more than this problem, this problem? I don't think you have to get to that level because at the end of the day, we're just trying to have enough conviction to move to the next step, which would be increasing the fidelity of the test that I'm doing. Before I decide what my MVP looks like. When I get to my MVP, ideally it is solving a very specific problem and it's very clear to the user that it's solving that problem. Because if it looks like it's kind of solving 3, 4, 5 problems, it gets— it's just hard to get traction because people don't know if it's actually for them or not.

Yeah, I think that's sound advice. I really like this question. I think What is a boring problem? Can you give an example? So Joe from Abidiya, Palestine, hope you're safe, Joe, as well, is asking what is a boring problem? And I think you kind of had one slide about it, but I think it's worth diving a bit deeper into because I think a lot of people are thinking AI and fancy and I gotta go crazy. And actually, I'm like you, I love boring problems. I like things that solve complex stuff, which is like super simple.

I'll give you, I'll give you some examples. And by the way, I have no issue with AI solving a boring problem. I just, leading with AI is part of the issue. So if I look at Highline Beta's portfolio, let me just pull it up right now. So we have a company in our portfolio called Build Captive. And what Build Captive does is it makes it possible for small and medium-sized construction firms to insure themselves through what's called a captive. If it's a complicated, somewhat complicated concept, but big companies often are their own insurance. They provide their own insurance because they have the capital. Insurance typically pretty boring. Construction insurance even more boring and captives even more boring than that. So to me, that's a good example. Often things we find, by the way, I call it a boring problem, not because I actually think it's boring. I think it's super exciting. Anything in operations, a lot of stuff in supply chain, boring. A lot of verticals that get ignored. You know, lots of people are like fintech, fintech, fintech, or this or this thing. Right. But there's a lot of verticals and industries that I think are are underserved. So, so those are— that's one example that pops into my mind. You know, we have another company called Mozel in our portfolio, so I'll just use them as an example. And there they provide, again, mostly small merchants, often focused on e-commerce, with the ability to do auto-replenishment and auto-buying of the inventory that they need. Like buying the t-shirts that I need to print to sell to you guys online is boring, right? 'Cause the cool thing is the t-shirt and how to sell it and the marketing and the go-to-market and the, how it gets made is boring until it's not boring because you can help these companies save millions of dollars or make millions of dollars. So those are examples to me, again, especially industries that are maybe underserved as well. Now, those sometimes are slower to adopt technology. So if you don't understand the industry or the vertical and you think, oh, that's a big space, I'm going to go crush it with some cool AI thing, you're probably going to lose.

I swear, each of your responses, like, people just need to be taking so many crazy notes. All right, let's— I'm sorry, I'm trying to burn through this as much as possible. Sure. Yeah. Rapid fire. Rapid fire. Yeah, I don't know how you'll wrap it through. So Luke from NYC is asking this question. The reason I'm bringing this up is it was the most upvoted and there's a lot of people asking about competition. And I think, can you just talk briefly about like, hey, you're working on this idea and then you find out like a big player like Apple or Microsoft is gonna release a competition. Like, do you drop the idea? Like, how do you kind of like process that information of like, oh wow, another person's doing this? I think it goes into what you were talking about with boring and defining the ICP, but I'll let you dive.

Yeah, so, so here's the thing. This is— it's a great question. And so, but here's what I learned. If you have an idea, I 100% guarantee you there are at least 1,000 other people with that same idea, of which probably 200 of them are working on it.

It—

there are barely any ideas left. So that's another way of sort of thinking about this, right? But you never know what they're doing in their boardroom, right? You never know why that company came up with that, why they're releasing it that way, why did they make that change. You have to rely on your own research and your own validation work and trust that. That's why trying to get to an insight becomes so important, because if, if what you're rooted in, if your whole business is rooted in that but you don't really— never ran an e-commerce business, you didn't talk to anybody that does it, You're gonna lose because you don't understand things from the guts. If you do understand things from the guts and you believe you know something that other people do not know, you can anchor your whole business. Although I'm human, which means it scares me. I back off sometimes when I see it.

Hey Ben, you're chopping, you're coming in and out. And you're back. Let's just give Ben a minute here. Hey Ben, you back? Hey Ben, can you hear us?

Yeah.

Okay, perfect. I think, yeah, you chopped, you dropped for a bit. Um, yeah, okay, you're back. So yeah, do you just want to quickly summarize like around competition? So you talked about, uh, There's a lot of people are already doing it, so you're not unique. And you said dive in and uncover that insight. Maybe anything else you wanna add to it?

Yeah, and you have to believe that you know something that other people don't know. I think there's ways of slicing competition as well. So you might go after a different ICP or a different vertical, but focus less on what they're, you have to know what the competition is doing, but you don't know why they're doing it. So focus less on that. And focus on your own process.

100%. The biggest example I give people is think of the world of CRMs. Ridiculous amount of CRM tools still getting, and more CRMs are being launched. Why? Because they've like, there's CRMs for store owners, there's CRMs for sales teams in this vertical. Like it's all one product, but it's just different verticals and audiences. So that's always a good thing to come back to. Bent, again, a lot of people are asking this is like, what do you do when people are trying to steal your idea? And why? Because again, you use your interview and use your feedback is so critical and you're gonna be sharing stuff. And I think it's worth talking about this from an expert.

Yeah, I get it. I get this feeling. Generally in my experience, most people, I'm sorry, generally in my experience, this does not happen very often. I'm not going to suggest it does not happen, but it happens very rarely because most people have a million of their own ideas and most people think, have a bias towards their own stuff. Like most people think their ideas are better than everybody else's. So to me, I would worry less about this and again, focus more on how well are you going through the process of actually validating something which you're not necessarily going to share. If you're interviewing somebody, or you're not necessarily going to share if you're pitching somebody or talking to a potential partner that could be a competitor. So to me, how you go through the exercise of validating something and the rigor you put behind it is the secret sauce. It's not the idea itself.

That should be a big quote for every VC. It's like, it's not about It's not about the idea, it's about the rigor. Um, all right, let me bring up this one, which you talked about universal truths, and we have like a few questions here. Maybe do you want to dive a bit deeper into it? Because people are like, hey, should I even pitch it? How do I uncover it? And like, what, what makes it—

yeah, great, this is a great question. So I think, uh, communicating a universal truth in a pitch deck is totally fine, and, and I see that a lot, right? Which is almost like the We use, use sustainability as an example, right? The world is getting warmer. Some of you may actually disagree, but let's just assume for a moment, like you put in a pitch deck, like the world is getting warmer. There's too much trash, like things that most people would just generally agree with. So if you're doing a pitch deck to set the framing of something, that's totally fine. But it's like you can't say to me, We have too much garbage. And my answer is this, without connecting some dots there, like, do you understand how recycling actually works? Do you understand where the waste really goes? Do you understand who pays for recycled material? Do you under— So if you just tell me there's too much garbage, ta-da, I have a magical solution, and then you throw AI and machine learning and robots and whatever trendy thing, We're disconnected. So you can start with the universal truth to set the stage. But then what I would be looking for, especially at an early stage, is like, can you dig and dig and dig and dig and dig and dig in? And I'm like, oh, that's an interesting problem that if we solve that, it could have an impact on the universal truth. So that's how I would look at it in a pitch deck when I'm telling a story.

Yeah. So, so John, our founder, talks a lot about the narrative around the pitch deck. So I think Universal truths would be right at the top of that, which is like, okay, what's the background information around it? So I'll just bring this on from Alejandro. He's talking about jobs to be done methodology and similar things. I think it's worthwhile in terms of talking about frameworks and again, for early-stage people, we talked about minimum viability, feasibility, and desirability as a framework. We talked about jobs to be done. Any other things that you'd like to mention or help the founder?

I like jobs to be done as a way of understanding. So jobs to be done at a very high level says that people hire things to do a job for them, right? So I hire the water to hydrate me. I hire the computer to allow me to communicate with people, whatever the case may be. I like that framing, particularly for functional needs. It can help with unlocking emotional, social needs. I think about these frameworks not as an insanely rigorous methodology that you must follow, because if, if you go and you use Lean Startup or anything else and say, well, I did the steps, did I win? You probably did not win because there's always at this stage a qualitative component to it. There's always a gut and instinct component to it. And jobs to be done, I like it as a way of thinking about problems. Like, why are people, particularly around the things they're already using, I, we call them hacks. Like if I found a problem and it's painful enough, people are trying to solve it. I like, I'm trying to solve, you know, the customer is doing something. If they're not trying to solve the problem, then they didn't hire anything to do the job. So what that— maybe it's not really a problem. So if there is a painful problem and then you're like, but why are you doing it like that? That's like 40 steps. That seems unnecessary. That looks really painful. That's the jobs to be done mentality that I like applying. But none of these frameworks, in my opinion, do you follow religiously to the T and expect to win because that's not how companies are built. Built.

Well, Ben, you're just dropping a lot of insights today. It's like, hey, don't like use these frameworks as guidelines and or guideposts. I really like that. It's a very good way of thinking. Um, all right, I really like this question as well from Reboot from Salt Lake City. Is for someone who's just starting out, they're joining this event, um, they're getting started in their entrepreneurial journey, what are some like very easy tips that they can to kind of get into comfortable with their shoes? You know, is there something they should do in the morning, something to read, or whichever?

Yeah, yeah, great, great, great question. And honestly, like, folks, if you're starting the entrepreneurial journey, congratulations. It is super hard. But, and despite there being 400 and some odd people on this call, which is awesome, most people are not entrepreneurs. So I always think of people who want to go start companies as the 1% of the 1%. Not elitist, but it's a small group of people in the sum total of the planet willing to take a swing. So I like that. One of the things I would suggest is find like-minded people locally that you can connect with. You know, they might be a little further ahead than you, which could be mentor-mentee relationship. But often it's peers. If you can find peers, and I say locally just because it's so much easier in many scenarios to just sit with folks and have a coffee and share the good, the bad, the ugly. So I would recommend that. I would recommend, you know, just getting in the habit of learning how to do this kind of work because it is a skill like any other. And so even if you're not in love with a problem or the idea you have, you say, Could I do a 2-week sprint, talk to 5 people, get better at interviewing people, even if I know this is probably not the thing I'm going to work on? So to me, the habit is the— this exercise of research and validation. And the more you can do it, like any skill, the better you're going to get. So when you do have an inspiration for an idea or you meet somebody and they tell you something and you say, wait a second, that's a real problem, I could help you. You'll be ready to actually go do the real work. So it's almost like the practice runs, uh, before you get to the conclusion of that's the company I want to go build and maybe spend the rest of my life building.

Yeah, I think that's very, very key, especially that how long you're going to be spending time on. Okay, I want to do one more question and then we'll break out for networking. Um, you talked a little bit about this on the customer development side, but I think worth talking about is like how many people should people go interview? 3 is too less, uh, call obviously from London saying 100 would slow down the cycle time. But can you also allude to the difference between B2B and B2C? Like if I was a B2B founder, I like go, how many people should I go talk to versus when I'm on the B2C side?

Yeah, yeah. I think, I think on the B2C side you often end up needing to speak with more people but they're also easy, usually easier to find. Um, on the B2B side, again, the number I suggested earlier was 10. So it's like, can you speak to 10 people that you— again, like, if they're 10 random people, it will not work. So you have to say, I think I'm targeting this type of person in this business or vertical. You find 10, you talk to those 10, and then you go back and say, what did I learn out of of speaking to those 10 people? Did I hear any patterns that would suggest I should go in one direction or another direction? And those directions might be, I need to go talk to more people like this, or that might be I'm completely barking up the wrong tree, or actually all 10 of them, you know, there was real pain I heard and it was all quite similar. And maybe my next step might be putting some concepts in front of them from a solution perspective to see if they're interested in that. So it's hard to know where you'll go after that first 10 because it can go in a variety of directions. But I would start with 10. And honestly, the, the B2B, it's basically LinkedIn. It's like you get on LinkedIn and you just reach out to people and say, I'm an entrepreneur, I'm looking at starting a company in this space. I really just want to learn about some of the pain points you have with 'XYZ,' you'll get some people who will tell you, 'Leave me alone.' You'll get a lot of people who ignore you, but people generally like talking about their problems. And so there's a good chance if you blast enough people, you'll get 10 that will be willing to do an interview with you, 30 minutes, and you'll learn a lot from that exercise.

Can we encourage people to do that all the time? Just get out there, start talking to customers and get onto that feedback train.

It won't be the last 10 people you speak to, right? It's not talk to 10 people, come up with a solution, build a solution, and win. You will, but you know, to get from step 1 to step 2, it's about 10 people.

Yeah, the only thing I want to add to that is like if you're going with like other industries like academia or pharmacy or whichever, they'll— some people may not feel comfortable with talking, but in terms of academia, like university, I remember when I was trying to do my idea at FI, like, I just called the head of admissions at the universities, and I'm like, hey, I'm a founder and I'm trying to figure this out. They're like, yeah, okay, I'll talk to you for 15 minutes. So like, and that, you know, and because it's university, the information is publicly available, right? So like, you get, you got to think a bit creative as well. Um, all right folks, I want to wrap up here. Ben, thank you, thank you, thank you so much. This has been awesome. I would love to do this pretty much like on a more frequent basis. But folks, go sign up for Ben's newsletter. Follow him on X, or formerly Twitter, LinkedIn, and all that. Ben, any last, your last closing thoughts or advice for the founders on the call, and then we'll wrap things up.

No, no, I just, I, you know, I wish everybody the best of luck. Please remember also that this is not, this is not scientific, right? So there's always an element of your own instincts and guts You cannot eliminate that from this process. The learning you get is never perfect. It's never, you'll never be complete. And so, you know, to the question of do I interview 3 or 100 because 100 would slow me down. If you find yourself interviewing 50 people, you're probably wandering the desert. So just realize like at some point you have to make a leap. And if the leap is not expensive or time-consuming, you know, that next experiment to try to get a new type of learning. Do that as opposed to saying, I didn't hear what I want, or move to something else. But don't get caught in that analysis paralysis or trying to follow these methodologies to a T, because you will literally wander the desert forever and almost become an expert at invalidating. And not— which is great to have that rigor, but not somebody who's actually going to take the leap to the next step, because it's not This is not perfect, uh, you know, it's not perfect data the whole way. You, you gotta make some— you gotta take some bets.

I feel like a lot of this stuff has to go on t-shirts or on plaques around the office, but I'll start a slide shop.

I'll do that, no problem.

Uh, all right, Ben, thanks so much, folks. We're gonna end the session now. You'll be transported into this virtual lounge. There's some tables, uh, go speak to each other. That's where the value is. On events like this, talk about what you've learned. We'll have some members of the FI team also on some of these tables. But yeah, we'll wrap up. Thank you so much, Ben. I'll let you go as well. I'm gonna end the session right here. Thanks, everyone.

Thanks, everybody.