Tackle hard problems to turn walls into moats

Some problems are too easy to solve: low barriers to entry result in a crowded market with many copycat products and low margins. Some problems are too hard to solve: insurmountable barriers to entry result in unfundable or failed startups that never get off the ground.

For a startup to win, it needs to solve a big enough problem to be valuable and small enough to be solvable. However, it can’t be too easy to solve; otherwise, competition will eat away at margins and increase sales costs.

Founders’ appetite (and capability) to solve hard problems vary greatly. It’s easier to make a small fortune with a B2B SaaS startup than to make life multi-planetary. Even within the B2B SaaS category, willingness to tackle difficult tasks varies greatly.

Many startup leaders shy away from the most painful problems. Whether it’s too hard to build, too hard to sell, or requires massive scale to achieve viable economics, there are many reasons to put opportunities in the too-hard basket. Tackling difficult problems is how we build differentiation in startups, however.

Problems that feel too difficult to solve are often the problems we should run towards. When we tackle these problems, we turn walls into moats. Many of the problems you find scary today are the problems your competitors will soon struggle to follow your lead in solving. We build moats by giving it a go.

So, dig a little deeper next time an engineer tells you something is impossible to build, your head of sales tells you something will be too hard to sell, or your accountant tells you the unit economics won’t work. Often, they’ll be right. But if you take them at their word every time, you may miss your best opportunities to build a defensible moat. Startups are deploying Generation IV nuclear reactors, mining asteroids, and delivering goods with automated drones. These things make most problems in SaaS feel pretty beatable.