The notorious economist, Christopher Wallace, rapped about the positive linear correlation of money and problems. I tend to agree with Biggie’s hypothesis but wonder if its as much a causation as it is a correlation. Without getting too philosophical, I generally hold three key tenets with respect to startups: (1) go for the fat part of the curve, (2) solve a problem simply and (3) charge for your solution. In other words, don’t create a new market but rather find a simple solution to an existing problem in a huge market that is willing to pay. Sounds easy right? Look at the top 10 paid apps in a variety of categories here. Top paid game: poker. Top paid entertainment: visualization. Top paid utility: units conversion. Do you see the trend? They kept it simple and they went for the fat part of the market, while charging for their solution. With more than 50,000 native iPhone apps, developers cannot afford to go for the long tail unless their costs are near zero. Otherwise, it is a money losing proposition. Too bad the opposite of Biggie’s hypothesis doesn’t hold true.
