A framework for building a unicorn
To build something meaningful, you must unlearn a million years of evolutionary biology.
Millions of years of evolutionary biology has made us, as a species, exceptional at spotting patterns. This ability to spot patterns allowed us to detect predators, recognise food and detect weather changes.
To show just how exceptional we are at pattern recognition as a species look no further than ‘pro chicken sexers’.
Expert chick sexers are able to quickly and reliably determine the sex of day-old chicks on the basis of very subtle perceptual cues. They claim that in many cases they have no idea how they make their decisions. They just look at the rear end of a chick, and ‘see’ that it is either male or female. This is somewhat reminiscent of those expert chess players, often cited in the psychological literature, who can just ‘see’ what the next move should be; similar claims have been made for expert wine tasters and experts at medical diagnosis. All of these skills are hard-earned and not accessible to introspection.
This innate ability to pattern recognise is not limited to only these professionals. We are all constantly spotting patterns and feeding them to our subconscious. To build a category defining business, you must unlearn million years of evolutionary biology, and break from the pattern!
Force a choice, not a comparison
The difficult reality is that to build a truly big company, you need to break from a pattern. This is incredibly unnatural to us, and it’s not for everybody. There are two reasons for this.
Firstly, one assumes that doing something ‘new’ brings more risk. (I believe this to only be marginally true).
Secondly, breaking free from the chains that bind us to conventional thought is exceptionally challenging. Something I will address in a later paragraph.
What I see most startup founders building will offer their users a comparison, not a choice. For example, proving a better way to purchase DVDs gives your users a comparison, whereas creating a new paradigm in how we consume video content gives users a choice. Do you buy a DVD or do you stream? When you look at the startups that have changed the world, they force a choice. They build something non-consensus, that pushes the status-quo and is different from what exists today.
As Henry Ford put it. “If I had asked people what they wanted, they would have said faster horses.” I’m sure people in the late 19th-century were breeding faster horses and making good money, but there’s a reason Ford is a $43bn company today and Faster Horses Inc. isn’t.
Take Uber as a more recent example. At that point in time, their hypothesis was non-consensus. Most people believed that riding in a strangers car wasn’t safe. The technology enabling ride-hailing apps was also only just emerging, driven by the rapid adoption of iOS and Android mobile devices and the release of the iPhone 4, which featured chips capable of detecting location with one-meter accuracy. Today of course, Uber’s hypothesis has been proven correct, and they have built a $150bn company.
So how can you break free of this pattern-recognising conditioning, and find these non-obvious truths that lead to companies like Ford or Uber?
Operating at the frontier
Finding these breakout ideas is often about understanding what the future will look like. Everyday, around us there are new paradigm shifts that allow for massive upheavals in how people solve a challenge, and in turn, opportunities for savvy entrepreneurs. We just have to spot them.
These can be technological shifts, such as the shift to cloud computing, which gave rise to many multi-$bn SaaS companies, or in the case of Uber, a new chip being implemented in iPhones that allowed for precise location tracking.
They can also be cultural. The non-consensus realisation that Airbnb had - that a growing trust in online ratings and reviews could overcome concerns about staying in a stranger's home, which was also exceptionally timed with a strong desire to save money on travel in the wake of the 2008 financial crisis.
Notice, I explicitly didn’t mention the recent LLM/AI wave. Don’t get me wrong, there are exceptions here, but the use of large language models is now extremely consensus. Startups in this space will often be competing against a myriad of other startups, and again, you will be offering your clients a comparison with the next AI startup, rather than an Uber vs. Taxi style choice.
Live in the future, then build what’s missing - Paul Graham
I have really identified three ways in which I try to live in the future. The people I surround myself with, the problems I work on and finally, seeking out quirky pockets of the internet.
People you surround yourself with: Surround yourself with interesting people, tackling challenging problems, and ask them questions. Whether that’s your friend who’s working at an AI startup, or just a mate who’s a bit too into their wacky health treatments. Spend time with people who have different insights and opinions. Be open minded, and listen to those people who operate at the frontier of a field. (Just listen to this take from Peter Thiel to get an idea of the kind of future-focused topics he’s thinking about).
The problems you work on: Take Henry Ford for example, whose interest in mechanics began in his youth on a Michigan farm. As early as 1896, he completed his first self-propelled vehicle. For you, it could be conceptualising/building solutions to the problems you face on a daily basis. Often the desire to solve a problem forces us to operate at the frontier of what exists today.
Quirky pockets of the internet: If you do not already use Twitter/X, you would be surprised by how many incredibly interesting accounts exist, that are building/writing about the frontier of new technologies and willingly share their research and ideas. Spend time curating your feed, blocking the noise, following the interesting account, and you will be let in on some of the most interesting ideas. Reddit, blogs and niche communities will also give you access to this.
Where that leaves us
Great entrepreneurs break from what we know today. They reject the path of refining what already exists in favour of building something different, new, and meaningful. It is the very absence of pre-made landmarks that offers the potential to build something truly great. Operate at the frontier, look to the future and work to understand tomorrow’s problem. From there, you can build something amazing.