How to pick startup ideas

One of the most important things I learned from running a startup is that on a macro scale the innovation market is efficient. If the market conditions allow for a startup to arise, it’s overwhelmingly probable that multiple startups already exist in that market. The converse is also true — if there are no startups in a given market, it’s overwhelmingly probable that market conditions are not hospitable and startups cannot arise.

In this sense startups are similar to biological life. Wherever the conditions are hospitable, life already exists. The difference is that startups live in an economic rather than a biological environment.

This has massive implications for picking startup ideas because technology companies tend to be winner-takes-all. The first technology company to solve a problem is often worth much more than all of its competitors combined. So if a company already exists in a market, it’s overwhelmingly likely you won’t be able to displace it.

Source: How to pick startup ideas