John Collison on how to come up with startup ideas

Stripe co-founder John Collison reflects on the fact that the best startup ideas are often obvious in hindsight:

“Anyone who has taken a cab in San Francisco should have had the idea for Uber. Or in the case of Slack, [Stripe] internally was struggling with the problem of team chat. And not only that — everyone we knew was struggling with the problem of team chat. The idea to build a company to tackle that seems obvious in hindsight. But that ‘obvious in hindsight’ doesn’t really help you because if you only realize the opportunities after they come along and someone has shown you the path, that doesn’t really help you get anywhere.”

This reminds John of an anecdote from David Foster Wallace’s “This is Water” commencement speech:

“There are these two young fish swimming along, and they happen to meet an older fish swimming the other way, who nods at them and says, ‘Morning, boys, how's the water?’ And the two young fish swim on for a bit, and then eventually one of them looks over at the other and goes, ‘What the hell is water?’”

John explains why it’s relevant to startup ideas:

“[David Foster Wallace] uses this anecdote to explain being mindful in the day-to-day lives that we live. And it’s a little bit like that as you think about opportunities on a day-to-day basis. We live in a world that’s completely broken in lots of small or big ways. And we’ve come to just work around them. We’ve come to take them for granted.”

John continues

“Spotting opportunities requires you to jump out of that mode briefly — to question how things work and be unreasonable in suggesting that it’s not valid for them to work this way. It’s interesting to note that the companies that are successful in changing an industry are often not started by insiders. The insiders know too much about that industry. They’ve been swimming in that water for too long. Certainly that was the case in Stripe’s case. As we came to learn more about how the payments industry worked, we could see the reasons why everything worked the way it did . . . And it requires you to stand back and say, ‘No, wait a second. That’s not how the Internet works.’ There’s a practice you have to get into in how you look at the world to stop accepting everything as reasonable. We are all swimming in opportunity, but it’s often really hard to see it.”

Full video: Stanford eCorner “John Collison: Putting Startup Success in Perspective [Entire Talk]“ (Feb 2015)