Innovation against Assumptions
The best startup ideas seem at first like bad ideas. This phenomenon is a meme in startup culture and one which few struggle to justify: bad-sounding ideas tend to deter competition and thus the ones which are actually good support monopolistic dominance. However, the true reason for this relationship is more fundamental: the value of “bad” ideas extends far beyond their role as proxies for untapped markets.
One could rephrase the claim at hand and say that the best startups are those which contradict popular assumptions. Not only are these ideas incompatible with contemporary beliefs, but they are incompatible with the right beliefs. The best ideas are those which spot poor structure in the great scaffolding of modern thought and work against its assumptions to make progress in the right direction.
The most obvious competition to a bad-sounding yet good idea is the good-sounding, good idea. However, invention which follows expectation will never provide as much value as that which undermines it. A faster horse might be nice, but it won’t change the world in a profound way. In fact, your faster horse will probably look slow once racing against the even faster one which comes out next year. Competition through the incremental–specifically, through changes which immediately sound good–is a race not easily won and whose fruits are marginal.
On the other hand, the world’s first car was able to transcend the ranks of horses altogether, but its pursuit surely seemed unwise at the time, although only insofar as it seemed impractical. The benefits of such an invention are two-fold: not only did the car disrupt the state of transportation, but it knocked down a barrier to modern-man’s thinking. Once the means of transportation had entered the realm of man-made contraptions, the next generation of inventors was free to think of planes, trains, and space-shuttles. In this way, good ideas which sound bad produce a form of innovation more profound than that brought about by good-sounding ones. These bad-sounding ideas are the ones which serve as economic multipliers and which alter the popular view of the world; these are the ones which introduce new markets altogether.
If the best ideas are those which seem bad, how can one see the mislabeled for what they are–that is, how can one distinguish as worth-pursuing an idea whose badness is taken for granted?
The first approach is to reason about a problem from its first principles. There’s no fundamental reason, for example, that the horse is the ideal means of transportation. If you step back from modern assumptions and consider only inherent obstacles, you can find holes in the market which have been overlooked because of now-outdated or never-quite-necessary assumptions. Of course, it takes a certain level of expertise to separate intrinsic from artificial restrictions. Luckily, analogy is a shortcut in this process. Once phones were equipped with a full-fledged operating system wrapped in a custom, touch-friendly UI, the same approach seemed obvious in the world of tablets. In this way, innovation can serve not only to rethink assumptions in one industry, but to provide a pattern of rethinking which can be applied across other industries just as well.
The second approach to selecting bad-sounding ideas is through direct confrontation of assumptions. If reasoning from first principles moves bottom-up, this approach goes top-down. Leading with the goal of liberating automobiles from fossil fuels you can begin to isolate the assumptions on which this pairing hinges. After climbing down a few layers, the initial complaint can take tangible form, e.g., batteries are not yet good enough to support automobiles independent of fossil fuels. Through this approach, you can identify the reason that a problem exists and then assess its legitimacy.
Together, these two tactics allow you to imagine improvement in unpopular directions. Invention of this sort changes how a given industry is understood and lays the groundwork for further innovation. It is only by going against assumptions in this way that innovation becomes anything more than simple extrapolation from the status quo and that the world’s view of a problem can be refined.