Why do startups fail? This is the only thing you need to know.

Today I had the greatest epiphany of all times about Startups. The truth hit me while I was reading an answer on Quora about 7-year old Ryan, a kid who made $22 million for making videos where he was unboxing toys on Youtube. You are doing it all wrong, right from the beginning. The root cause for the fail of Startups is at the conception.

80% of Startups fail in the first 2 years. Founders spend a significant time of their life for fails. Investors spend billions on startups that fail. The governments spend billions of taxpayer money on grants to fund startups in order to drive entrepreneurship. And Startups fail.

They tried to explain why… Perhaps it is that founders don’t find good partners. Perhaps they don’t know business well enough… And then some truth came out: They are making products that nobody wants.

?The most fundamental advice for Startups is wrong. That is that

“you must find a pain, a really big pain in the world." Boo!!

And it assumes that then you will solve it, and everyone will pay you for it. BIGGER BOOOOO! It is this nasty, fear-driven idea that has cost time and money to everyone, and truckloads of unneeded stuff. The root of this idea comes from fear-driven, controllers, who hope to trap people from their needs, so as to make sure that they will be able to exploit their needs and profit from them. A narcissistic, exploitative technique, given by exploitative narcissists that try to put people in a corner, and make them needy. And guess what: they flanked. Big time. Like…. 100%. And you will see why.

After everyone lost billions, Investors and Startup advisors started to reconsider what went wrong. A new generation of Investors & advisors is now focusing on passionate founders. They think that if the founder is passionate, they will succeed. And they tend to apply that to “Social entrepreneurship”. Uhm…. Half of the issue found. You keep paying for the wrong things.

7-year old Ryan made $22 million on Youtube by unboxing toys. That is, children’s toys! $22 million. Do you see any pain there? No. So how did he – or his parents to put it better – make $22 million? The reason is that toys are a passion for children. They don’t exactly “need” all the big fancy toys. Nor is unwrapping toys and being awed by them a pain. It is a passion.

Here is a second example. In the process of trying to crowdfund my startup, I have been looking at Campaigns of other Startups. So I come across this Campaign of Megabots. Megabots raised over $500,000 in crowdfunding to build giant robots that battle one another. They went further to raise $2.4 million in seed funding. Oh dear, what a great pain they solved. Has it hit you yet?

The assumption made in the advice about finding big pains is that people face their issues and solve them directly. And therefore, you can solve their problems, and they will be happy. First, this comes out extremely wrong: People don’t like to speak about their pains. Speaking about pains immediately drops the energy levels, and makes everyone feel drained and terrible. No one wants to hear about it, or be reminded of their pains!

Most importantly….Newsflash: people aren’t motivated by thinking about solving their problems. They don’t think: “I have this problem, and I will solve it". It isn’t that people were missing for that magic gadget that would solve their problem. It is that they didn’t have passion to do anything about it, and they would not do so, even with your magic pain-solving gadget.

What drives people forward is their passion. People are motivated by their passions. By following their passions, they solve the problems even without directly seeing them. Most often, that is because people disrupt their problems, fueled by their passion. Especially the biggest ones, which are the ones that Startups are supposed to be solving. That is, most of the time, people do not actually solve their problems, because they completely get out of the situation that caused them. Ergo, your plans to trap them in their pains goes in the bin.

Smart, successful people spend a lot of money not to solve their problems, but to follow their passions. If you want to make a successful product, find a big passion in the world. People pay their big money for big passions. They will pay for things that make them hope, make them dream, make them feel optimistic. The magic always comes from passion and imagination. All Startups that made big money did so because they found a passion in people. They made people dream, and they made them passionate.

Let me put it this way:

You have a higher chance of making more money if you sell Harry Potter's magic wand, than if you sell a cure for cancer.

If you want to make a Successful startup, find how to captivate people’s passions and imaginations. That is what people will buy, and that is the product you should make!

"One moment", you ask... "And how about relieving the world's pains?" The purpose of a Startup is primarily to inspire the world, than to directly solve all the big pains by itself. Don't take the weight of the world on your back. It will bring you down.

For what matters, you can't solve the world's pains. You don't know them well, people relieve their pains in their own way, and it is too big for one founder to do at once anyway. So instead of finding big pains in the world, find things that people are passionate about, or make them passionate. When you do, people will find ways to deal with their pains.

What exactly changed here?

Let me put it more specifically, so you don't think this is about marketing again.

The old "Market it" method you were using before

1. You were making a product that directly relievs a pain / solves a problem
2. You then present that product in a passionate light

Make anything, and then wrap it in marketing. Doesn't last for long. Failed.

The "Passionate Founders" method

This is what Investors and current advisors are saying.

1. Make whatever it is you make
2. Present yourself as "passionate" so people will buy from you

They did this because they thought people bought the items because the Founder was passionate. To wrap up this story, they tied it with Social entrepreneurship. They didn't realise that the reason why this may have worked is that people today are becoming more passionate about society.

What I am saying is

When you are looking for what Startup to make, take these 3 parameters into account, in this order:

1. Find a product or service that people are passionate about, or makes them be passionate, inspires their imagination, and makes them dream
2. Present it in a passionate way & be passionate about it yourself
3. Ensure the product or service practically solves a big problem

If you fail #1 and #2, then #3 doesn't matter: You will fail. If you do only #1 well, you will succeed. If you do #1 and #2 well, you will succeed big. And if you do all 3 well, you will succeed massively.