How to Look For & Find “Problems” to Solve in Business

Often when starting a business entrepreneurs are told to find a problem to solve. Now last time I said that a problem is relative and can be anything. Yes, as South Africa’s cost of living spirals out of control the needs (cheap food and clothes) will take precedent and will be big business.

The problem is that many problems already have solutions (existing businesses solving the problem) and when it comes to smaller problems the market will be too small to be viable and sustainable. So instead of thinking at individual businesses we will think the same like we did with 2022 businesses by instead looking at categories.

I will look at opposite ends of the spectrum “everything awfuls” which are the big problems and big business  with established industry and I will look at the other end “solutions looking for a problem” these are nascent industries where things are still being figured out. I will also look at elephants in the room where people don’t like to discuss.

Everything Awfuls

We will start out by looking at South Africa’s multi-billion rand safety, security and self-defence industry.

South Africa is one of the most dangerous countries in the world (usually in the top three). A global leader in violent crime and sexual assualt.
The problem is there is neither the politician will, law enforcement competence and self-defence laws to back it up. What am I saying? In SA it takes many hours for the police to respond to a call. But South Africa also has very weak self-defence laws, there is no “stand your ground” there is no “castle doctrine”. Even if someone is on your doorstep with a knife to your throat or a gun to your head under SA law you have a “duty to retreat” (that is why the prosecutor kept asking Oscar Pistorius why he didn’t run away and hide instead of confronting what he thought to be an intruder). There is neither a law that designates a person’s place of residence as a place in which he or she enjoys protection from illegal trespassing and violent attack nor is there a law that allows the use of deadly force against trespassers even if you find them in your bedroom. By the time the attacker has attacked there is little time to defend yourself. Couple this with incompetent police, overworked detectives and an overburdened justice system that is so used to extreme violence that murderers end up getting on average ten years and serving 5.

This is what I call everything awfuls, where people have no choice but to pay up and it is what has fueled the multi-billion rand armed response, CCTV, electric fence and burglar bar industry. You pay a subscription every month so you can push a button to have some guys check up on you if you heard some leaves ruffling outside your window. In other words you are outsourcing the problem. Armed response companies are not special, they have no special powers they are glorified alarm companies you are paying for someone keep you company until the police arrives.

The above everything awful is also what fuels the multi-billion rand emigration industry a lot of people leave because they feel powerless against crime in SA.

The same everything awfuls exist in healthcare (private vs government hospitals) which is what fuels the multi-billion rand medical insurance industry. As well as the multi-bullion rand private education industry, Curro 2021 revenue R3.5 billion (R3 543 million to be exact ).

With everything awfuls there are usually enough space in the market for smaller players because people feel they NEED the service.

Elephants in the room

Elephants in the room are the sacred cows of society. Many people pay money to make “problems” disappear here as well. An elephant in the room is an issue that is obvious or that everyone knows about but no one mentions or wants to discuss because it makes at least some of them uncomfortable and is controversial. Sacred cows are things held to be above criticism.

In South Africa a big elephant in the room and sacred cow is victims of domestic violence that don’t want to leave their abusive partners and instead they willingly take them back time and time and time again into a cycle of violence until they are eventually killed by their partner. Many people (men especially) would have intervened in the months and years that they person went back time and time again. But when the person is killed social justice warriors will flee to Twitter to post #MenAreTrash hashtags but nobody is willing to tackle the issue.

During the cycle of abuse the women will often spend money limit the abuse in order to continue the relationship this can be anything from indoor CCTV to indoor alarms to bring attention to the abuse and scare off the partner but they won’t leave them.

The business of elephants in the room is making money from other peoples poor decisions. Probably the biggest market in this business is making money from poor people who are living above their means. Nobody is pushing birth control and family planning to help the poor instead they paper over the cracks with child-care grants but because the grants must support the whole family there isn’t enough to spend on the child so the child’s needs get kicked down the road by buying stuff like single diapers. There is money to be made here. Childcare grants in SA is BIG money. Don’t be afraid to stand behind the cash register. Single nappies, R5 portions of this, R10 portions of that. Or you can open a shebeen and get even a bigger slice of the pie 😉

Solutions looking for a problem

Solutions looking for a problem are nascent industries where the cart are before the horse. Some people came up with a genius idea but there is little use of that idea yet the ecosystem around it is booming in another way. As I stated last time cryptocurrency especially shitcoins I mean community tokens are the biggest opportunity. Most of these coins have zero utility and is pure speculation.
But the problem in web 3 crypto and blockchain is not just shitcoins, even the tokens with utility, layer 2 solutions, faster blockchains they have very little uptake. They disperse millions in grants for developers to build on their platform because there is so little activity (outside of majors BTC and ETH). Activity as in actual utility, example BTC as a store of wealth and ETH as a smart contract blockchain, all the other poop and ass coins are mainly held for speculation. Even in cases where the tech is solid people just hold the coins for speculation. Most crypto projects today are solutions looking for problems. That is because the industry is so new and rapidly evolving.