Problems First
Find the problem people are already paying to solve, then insert yourself there.
- Difficulty
- Easy
- Time to result
- ~weeks to results
- Steps
- 4
- Confidence
- 80%
Cortland Allen's approach to validating and choosing startup ideas inverts the common advice to 'solve an unsolved problem.' Instead, he argues founders should identify problems that customers already have budgets allocated to solve, and demand proof (namely revenue numbers) before trusting any startup advice or story as a model. This framework shaped both how Allen selected businesses to profile on Indie Hackers (requiring real revenue disclosure) and how his peers picked markets to enter, such as targeting recruiting spend that companies were already paying for rather than trying to create a brand-new budget category.
Origin
Grew out of Allen's frustration reading Hacker News threads where founders gave advice or told success stories without ever disclosing revenue, making it impossible to separate real signal from noise.
Core principles
- 01Only trust startup lessons that come with verifiable outcomes (revenue numbers).
- 02Target problems people already pay to solve rather than create new budget categories.
- 03Selling to customers who have an existing budget line item is dramatically easier than selling to those without one.
- 04Educate-and-win only works efficiently when the buyer is already convinced the problem is worth solving.
How to run it
- 1
Identify existing spend
Look at where your target customers are already spending significant money — that's evidence of a real, budgeted problem.
- 2
Demand proof before trusting advice
When researching how others solved a problem, only weight stories that include real numbers (revenue, growth, outcomes) — treat unverified advice as low-signal.
Pro tip Ask directly for revenue numbers; most people who decline aren't worth modeling.
- 3
Position inside the existing budget
Build your offer to fit inside a budget category that already exists (e.g., recruiting spend, marketing spend) rather than trying to convince someone to create a new one.
Watch out Selling to customers with no discretionary budget (e.g., early-stage indie hackers) creates painful, low-conversion sales cycles.
- 4
Validate publicly
Share your own numbers transparently to attract a community of similarly serious, proof-driven customers and collaborators.
In the wild
Allen's friend Lynn started Key Values to help startups hire engineers — not an unsolved problem, but one companies were already spending heavily on. By inserting her company into that existing budget line, she reached $100k in quarterly revenue within about a year.
→ Fast, profitable traction by selling into an existing budget rather than creating a new one.
Common mistakes
Selling ads to broke customers
Allen's early attempt to sell ads to fledgling indie hacker businesses was stressful and low-converting because those buyers had no real budget for it — a violation of the 'sell what has a budget' rule.
Trusting advice with no outcome attached
Stories and advice without revenue numbers or proof are essentially untrustworthy signal, since anyone can claim success without evidence.
Is it for you?
Best for
Early-stage founders choosing what idea or market to pursue.
Not ideal for
Category-creating, visionary products where no existing budget line exists yet and long-term education is the strategy.
From the transcript
“if I could write a startup book, I would call it uh problems first, where like the first thing you want to do is you…”
“you want to look at problems that people are already paying a lot of money to have solved and kind of like insert yourself there.”
From the episode
Special: Acquired x Indie Hackers