Businesses Only Make Sense After The Fact

It’s always in the news: “Eating X, causes Y Disease!!”.

We all know that these types of statements do not prove what the cause is. Does red meat cause bowel cancer? Or is it that people who eat more red meat are also more likely to be sedentary, smoke and drink a lot more alcohol? Perhaps one of these other variables is actually what causes bowel cancer.

When people see these types of news articles, they generally are aware that “correlation doesn’t prove causation”.

So why are we so bad at detecting BS when it comes to so many other things?

Let’s look at the education system.

Does education cause economic prosperity for a country? Most people would say “Of course it does!”. However, it is interesting to note that countries get wealthy despite not being educated. Look at India, Bangladesh and China. Their economic growth has been incredibly high despite their lack of “education”.

In fact as they are getting more wealthy they are building more and more schools and Universities.

No!

Rich countries do have schools but, countries get rich first!

So what about businesses and entrepreneurship? The narrative is always there. “Solve a problem!”, “help a million people and make a million dollars!”, “be at the cutting edge of technology!”.

Well, I think this is all BS. It’s a narrative that’s created after the fact.

Tell me, what “problem” in the market place did Facebook and AirBnB solve?

If you ask the founders they will give you an answer: “We wanted to make the world more connected”, or “all of this space was being left unused and we figured out a way to use it”.

But, these are insights that are thought of after the fact. The founders of these companies weren’t trying to solve problems – they were being lead by their curiosity and a sense that what they were creating “should exist”.

I genuinely think that the best businesses / business ideas are things that the founder feel like “should exist”.

Many people say that the definition of an entrepreneur is “someone who solves problems”.

I think that the definition is more like; “someone who creates the change they want to see in the world via commerce”.

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