Founders, be bold – if there’s a consensus between Silicon Valley and Berlin, it’s that startups need to aim for bigger ideas. Last night’s chat between Kleiner Perkins’ Megan Quinn and writer-turned-investor MG Siegler, hosted by General Assembly in Berlin, continued that theme:
“Candidly, a lot of the pitches and the products that I see across my desk are iterations on existing products and services”, Quinn said. “The entrepreneur has taken a great existing product or service and made one or two tweaks to make it more compelling. It probably does make it a better product but it’s not enough for a venture-level investment, per se… You really need to have a vision for the future that demands your product or service exist.”
Siegler agreed. “In the first year, a little bit over half of everything I saw was – I don’t want to say clone – but a variation of the same idea of something else. Instagram for X, Instagram for Y… It’s just not the kind of trend that was going to keep going.”
Quinn, who led Square‘s product team before joining the leading Silicon Valley VC firm last May, and Seigler, who started an early-stage fund with TechCrunch founder Michael Arrington in 2011, are among the international guests in town for this weekend’s hy! Berlin.
Both guests – and moderator Matthew Brimer, the co-founder of General Assembly – shared specific suggestions for where to find those elusive world-changing ideas.
Look for big, “abnormally defunct” markets
If you’re looking for a problem to solve, try looking beyond your daily life as a 20-something living in the city. Education and health are universal and important markets that are “abnormally defunct”, as Brimer put it.
The tools we use have changed dramatically, Quinn agreed – yet many aspects of those sectors haven’t. “How do you leverage mobile and tablet to be a force-multiplier for students’ learning and the education industry in general?”
She’s particularly interested in consumer health (as opposed to enterprise solutions). “There’s hasn’t been a ton of innovation in the past 50 years in terms of consumer preventative health, helping consumers to better monitor and engage their own health.”
Find something you’re passionate about
Founders should actually care about the problem they’re trying to solve, whatever it is. “The most interesting ideas are when a founder is solving a problem that they actually have,” Siegler said. “You can just tell when you meet them that they’re super passionate about that idea.” Ideas for small problems can grow to become world-changing, he added.
Look to the past
“You often see the same ideas come about and be recycled,” Siegler said. “That’s a good thing, a healthy thing, because so much of this has to do with timing. An idea that didn’t work in the ’90s could work now because of any number of factors – mobile, a more connected world…”
Think about connected devices
As component costs come down, startups can, for the first time, actually afford to build hardware. Quinn is a fan of Nest (intelligent thermostats) and Lockitron (keyless entry). The common factor: connected devices that allow users to tailor their environments.
Think wearable computing
Pebble, Fitbit, Jawbone, Nike+ Fuelband. “All the big companies are probably going to get into that,” Siegler predicted. “You’re creating something that you’re always going to have on you, except in the shower, and a lot of those guys have even solved that problem.”
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