Lately, I have been thinking quite a bit about a set of reliable indicators one can use to sift through the vast ocean of weak signals (the “thin wisps of tomorrow”) to identify those that will grow strong and mighty — with a potential to lead to disruptive change.
We have talked about aspects of these before: The first one, technological maturity and scalability, is best summarized by IEEE’s Rodney Brooks, who said:
“I’m only suggesting that we properly gauge the difficulty of whatever we are told could be the next big thing. If the idea builds on practical experience, then guarded optimism is in order. If not, then not. Hope is a scarce thing; we shouldn’t squander it.”
The second one, gestalt, identifies the head- and tailwinds you might encounter which are outside your control. Imagine you would want to build a streaming video service; a lack of broadband internet in your target geography becomes a strong headwind which you have little control over (and ought to take into account).
After much stewing on this, I believe the third factor is the utility you get from a product or service. And here I love to reference my friend Chris Yeh’s three essential questions:
- How often do you encounter the problem the product or service aims to solve? (Frequency)
- How much time and energy do you spend in the problem space when you encounter the problem? (Density)
- How much pain does the problem cause for you? (Friction)
Coincidentally, those three questions (and thus the bigger question about the utility you get out of a product or service) are, if sufficiently high and met with a sufficiently good solution, also the best indicators for sustained growth: As long as there is a (hard) problem to solve (see also our post from last week “Solve Gnarly Problems”), there is a business.
What is the frequency, density, and friction of the problem you are solving?