February 16, 2021
What is an expensive problem?
One of the terms that you’ll often see used here on the list is “expensive problem”.
But, what exactly is an expensive problem?
When I use the term expensive problem, what I mean is that someone is having a problem that they would like to spend a lot of money on to solve right now
For example, Amazon.com being down and losing millions of dollars per second is a VERY expensive problem for Jeff Bezos. Or maybe Andy Jassy now ;-)
Expensive Problems vs Big Problems
Are EXPENSIVE problems the same as BIG problems?
No, not necessarily...
A BIG problem is not what I would call an EXPENSIVE problem if no one wants to spend loads of their own money to solve it.
An example of a BIG problem that is not an EXPENSIVE problem would be something like the chronic underfunding of public education in the US.
I think everyone could agree that underfunding public education is a BIG problem, but it seems that there’s not a particular person or organization who is willing to spend loads of money to solve it right now.
Expensive Problems vs Expensive Solutions
Are expensive PROBLEMS the same as expensive SOLUTIONS?
No, not necessarily...
An expensive SOLUTION is something that costs the seller a lot of time or money to deliver. But this has nothing to do with the value to the buyer.
The fact that a solution is expensive to deliver DOES NOT mean that there are buyers who have a problem that is EXPENSIVE enough to them to justify paying what the seller would need to charge to make a profit.
An example of an expensive SOLUTION that doesn’t address an expensive PROBLEM would be something like attaching a jet engine to a station wagon.
A jet engine can cost anywhere from 12 to 35 million dollars. Plus, there would be labor costs to weld it to the vehicle, reinforce the chassis, and modify the suspension.
I think it’s fair to presume that there is not a single person on Earth who would want to spend millions of dollars to mount a Pratt & Whitney geared turbofan jet engine to the top of their grocery getter.
(But if you find some manic who has done this, please feel free to reply with a link lol)
Yours,
—J