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Indicators that a startup idea is a good one

I always enjoy reading Paul Graham’s essays and his latest one How to get startup ideas is another great read. If you are an entrepreneur looking for ideas then I highly recommend you read the whole thing, particularly taking note of the common errors (building for a problem nobody has and trying too hard to come up with startup ideas).

I’m going to focus on one of the by-products of Paul’s essay which is a list of indicators that an idea might be good or an idea might be bad. Note that none of these are definitive evidence, they are simply signs. There will be great startups with some of the indicators of a bad idea and bad startups with some of the indicators of a good idea, but on balance good startups will have more of the good indicators and fewer of the bad ones.

Indicators of a good idea

  • It is something the founders want
  • The founders can build it
  • Few people realise it is worth doing
  • A small number of people really want it, right now, even if it’s a crappy version
  • It is on the leading edge
  • Looking back from the future the idea will seem obvious
  • The idea came because a problem was noticed, rather than because it was thought up

Indicators of a bad idea

  • Lots of people want it a little bit, but nobody wants it a lot
  • Lots of people want it a lot – if this is true someone would have built it already
  • Is in a domain the founders don’t know well