The core of startup leadership is rooted in its founders’ entrepreneurial mindset. Melisa Irene, Partner of East Ventures, said that an entrepreneurial mindset includes problem-solving and a solution proposal.
“If founders do not train themselves to clearly map out the issues they wish to solve, the product they build will not be successful. We should always ask: what is the actual problem?” Melisa said in a sharing session with start-up founders in the Makassar Startup Weekend in March.
“The right mindset focuses on solving problems. [This] will help your company create sustainable values in the market.” she added.
Four stages of problem-solving
In problem-solving, there are four stages that startup founders must undergo.
First of all, map the issue.
Countries group their sectors similarly. For example, education, health, food security, general consumption, and so on. Founders can analyze the issues happening in their country by comparing it with other countries, and conclude whether the issue is similar or different. It helps to analyze the specificity of whether or not the issue happens only in certain regions.
At this point, founders might have a list of potential issues or sub-issues they wish to dig deeper in. They could discuss with people in the relevant industries to help decide which issue they would like to focus on and address.
Second, we move to analyzing the current solution. In this stage, startups must identify existing solutions to solve the problem. If they do not address the problem well, then founders should explore new ideas that could offer better value.
Third, identifying a better solution. Continuing from the previous stage, the startup must translate their ideas into a marketable product – a product that consumers are willing to pay for. The goal here is to find and optimize product-market fit.
The last stage is to actively improve the process. In this stage, startups must have a strong attachment to the solution they have invented – to continue improving the product and the process so they remain relevant and differentiated.
Melisa noted that the fourth stage is rarely executed effectively by startups. She also mentioned that she often meets startups that have already operated for some time but failed to review and revise their offerings as the market developed.
The key questions in problem-solving
In this talk, Melisa noted that there are three key questions that must be considered in problem-solving.
First, is the problem important? To answer this question, startup founders must think about how big the impact of the problem is and how other players have attempted to address it.
Second, is the issue urgent? If the startup has a product but the market doesn’t consider the issue as urgent, then the product will only be a “nice to have” rather than a “must have”. It is medicine versus vitamin analogy.
The third key question is: What is the motivation?
Melisa said that in her time at East Ventures, she met with numerous startup founders that were excited to work for the first and second year. However, by the third year, founders were “burned out”, not so enthusiastic anymore, especially when the execution did not turn out to be as expected.
It is crucial that entrepreneurs are strongly motivated to solving the problem they have identified and remain focused in innovating in the areas they are passionate about.
“The term life-long learning applies to entrepreneurs. As we build a company that delivers real value to society, we also need to ask whether that journey adds value to our own personal development” she said.
From her experiences of mentoring and advising startups, Melisa said that these three key points – importance, urgency, motivation – are defining factors that help founders build a resilient company.