It's counterintuitive, but according to famed investor and founder of Y Combinator Paul Graham, the best way to get startup ideas is "not to try to think of startup ideas." Rather, you should look for problems you have yourself and solve them.

Still, there's a huge universe of problems each of us has. I've seen young founder after founder trip up on not being able to decide which among the problems they have are most promising to solve. There's a lot at stake in that decision because you can only turn one of your ideas into a company that you pursue with singular focus.

It's one of the toughest decisions a startup founder has, and it's something that I've struggled mightily with.

Recently, I was reading the blog posts of Noah Kagan--founder of SumoMe, founder of AppSumo, former head of marketing at, and Facebook employee #30--when I had an epiphany.

His writing followed a formula so simple and yet so powerful, that it rocked me to the core about how I thought about startup ideas.

Noah will describe a problem he had, the solution he came up with, and the extraordinary result he achieved with his solution. The result would always be so extraordinary, that it would make your pupils dilate, spark your curiosity, and force you to click through and learn more.

For example, he used the SumoMe email list building tools to grow his email list to over 750,000 subscribers. A list of that size is mind blowing and 100x what most SaaS companies have. The success he achieved in building his email list inspired him to build SumoMe into a separate product that anyone could use.

That's when I realized the trap that I had fallen into so many times. You shouldn't make a product out of a problem for which you obtained ordinary results. You should choose as your startup idea the problem for which you achieved extraordinary results.

How to develop extraordinary business idea

Before Noah founded SumoMe, he started a company called AppSumo in 2010, a daily deal site for software products.

He struggled early on. The problem was that every time he had a new deal, he had to go out and get a new set of customers to buy. He spent all of his time sourcing deals and convincing people to visit his site to buy the new deal, which had a treadmill-like effect on his business.

That all changed the moment he decided to do something that's so totally obvious that it's easy to overlook. He decided to collect the email addresses of visitors to his site, and then blast the entire list whenever he had a new deal.

Noah's business turned the corner, he built an email list of 750,000+ subscribers with thousands of customers, and he eventually grew AppSumo into a multi-million dollar business.

The experience taught him the power of email list building for software businesses on the web. Noah knew with 100% certainty that the tactics he used to grow his email list to such outsized proportions would be valuable to every tech startup.

Those tactics, turned into products, became SumoMe. Now SumoMe helps its customers reach 180,000,000+ people every month.

Why you need to be 10x better

According to legendary investor and entrepreneur Peter Thiel, to build a successful startup, "You have to be 10 times better than second best."

To Thiel, if your product isn't 10 times better, it will be hard to sell in a crowded market. You won't be able to differentiate your product from existing solutions, plus customers won't be willing to pay switching costs unless they're getting a huge benefit.

For instance, Thiel points out that Jeff Bezos's breakthrough insight with Amazon was his realization that an online bookstore could offer more selection than any brick and mortar retailer could--10x at minimum--and that feature was especially important with books which have millions of titles in print, far more than music or film.

For the young entrepreneur just starting out, that means that you should focus on those times when you have achieved 10x results, and work backwards from there.

Noah built an email list three-quarters of the way to one million addresses long, dwarfing what other web businesses struggle to achieve. His monstrous email list resulted in him being known as the email marketing guy. Given what he had accomplished himself, he knew he could deliver 10x success to his customers with SumoMe, which would make SumoMe successful in return.

The problem is that, by definition, extraordinary results don't happen very often. That means that--to get your best business ideas--you'll need to be patient. Noah worked on AppSumo for 4 years before getting the idea for SumoMe. In the words of Mark Zuckerberg, "Explore what you want to do before committing," be flexible, and don't be so laser-focused on wanting to start a company that you do so prematurely without a 10x idea.

Think about the times you've achieved big success where others have struggled. Your own 10x results show you the way to finding an opportunity to deliver a solution that gives 10x results to everyone else. That opportunity will point the way to startup success.

What customers need from your product

Put differently, your product should give your customer superpowers.

(via User Onboarding)

The reason that this is so vitally important is that, in the words of User Onboarding: "People don't buy products; they buy better versions of themselves."

For example, SumoMe takes an ordinary email marketer and makes them extraordinary. Amazon puts all of human knowledge at the fingertips of anyone with a web browser. Facebook takes an average person and makes them hyperconnected with friends and loved ones.

Your customers want to go from being good at their job, to being amazing at their job. Your product makes that happen.

Published on: Jun 8, 2015