Every great decision you make comes with downsides. There is never a perfect answer.
If you choose to move upmarket to create more profit in your business, you’re setting yourself up for the classic Innovator’s Dilemma.
If you work to continually improve your product and create more and more helpful features, you’re creating an opportunity for someone else to make a Blue Ocean by doing less.
If you choose to focus on one specific area of the market by providing one specific service, you’re at risk if market preferences change or disruptive technology wipes it out—or someone out-focuses you.
If you choose to become the cost leader, doing more than the competition for less money, you’re constantly at risk of all the profits from your industry going to a smaller, more differentiated, upmarket player.
If you choose differentiation, you’re at risk of letting the gap between your prices and the cost leader’s become too great, cancelling out the benefits of your differentiation.
If you bootstrap your business you’ll be able to stay independent and free, and fund your own growth, but a VC-funded competitor might outgrow you and take over the market by running at a loss.
If you choose VC funding, you’ll be under such immense pressure to grow that you could end up running at a loss, with an acquisition as your only hope of escape from the treadmill.
Every path has its downsides—there are no riskless strategies—and there is no such thing as a business, or a life, without problems. But knowing what you’re getting yourself into, and what to expect, can make those challenges a lot more interesting and fun to deal with.
As Mark Manson said, “True happiness occurs only when you find the problems you enjoy having and enjoy solving.”
The idea is to know what problems you’re creating for yourself, and finding joy in solving them. Instead of wandering down paths without enough caution, and finding problems we didn’t expect and don’t care for.
Running a business is one problem after another. As Basecamp’s Jason Fried once said, it gets harder every year, not easier. But, ideally, you’re also getting better every year, too, and you’re finding better and better problems.
Because there’s no such thing as having no problems.
But, through strategy, you can make your problems a lot more interesting to solve.