More unicorns are created by founders with lived experience than those without. Having first-hand experience of a problem is a superpower for entrepreneurs, and one that can help them gain competitive advantage, clear direction and a personal reason to succeed.
It can be the seed of inspiration and the reason why a regular person decides to jump into entrepreneurship. It creates the passion and dedication needed to push through obstacles and barriers, and to find a new way forward that others have missed. And when times get tough (as they inevitably will for startups), it is this first-hand experience that creates the grit needed to come out fighting again.
Investors know this too. Founders with lived experience are generally more attractive to Angel investors and VCs. When you've lived the problem, your conviction is real, and investors can tell the difference.
But lived experience comes with a hidden trap.
With lived experience, the founder often becomes customer number one, designing a solution to the problem they’ve encountered and imagining that if this solution had existed already, it would have been just what they needed at that point in their life.
This can sometimes lead to what we call ‘founder hallucination’. Sitting somewhere between confirmation bias and affect priming, founder hallucination is a subtle psychological trap lying in wait for well-meaning founders, and one that can have huge consequences.
We see this quite frequently, especially but not exclusively in first-time founders. It’s the “I had that problem and solved it like this, so others who’ve had that same problem will want this solution” mindset. But it's rare that two people experience the same problem in the same way, and rarer still that they'll land on the same solution, or even think to look for it in the same place.
We’re not talking about a failure of the founder, we’re talking about known human psychological restrictions. The Einstellung effect says that once you’ve found a way to solve a problem, the brain will actively block other solutions, even if they are better solutions. At worst, these hallucinations can be further amplified by emotional bias that’s often found in purpose-driven, lived-experience ventures.
There’s a famous quotation from Henry Ford (allegedly), saying that if he’d asked people what they’d wanted they’d have said faster horses. Steve Jobs also said “It’s really hard to design products by focus groups. A lot of times, people don’t know what they want until you show it to them.”
While both of these have merit, they can also get in the way of critical thinking and serve to reinforce founder hallucination.
The trick to escaping this and building solutions that appeal to more than just a market of one is objectively understanding the problem domain and those that experience it.
In the early 1900s most people might have said they wanted faster horses, but this is just the beginning of the conversation, not the end. What people really wanted was to get from A to B faster, more comfortably, safely and cheaply. The horse answer wasn't wrong, it was just the limit of what they could imagine without better prompting.
Our ability to think of novel solutions is often limited by the language we use to think. Our brains have evolved to see patterns and create mental models and schemas with which to comprehend the world, and this naturally constrains how we imagine solutions. This is famously embodied in the saying "If you only have a hammer, every problem looks like a nail."
This is exactly what Jobs was getting at. People often lack the ability to think of something genuinely novel with a blank page in front of them. His comment wasn't to say that people don't know the problems they face or the pains they suffer, rather that they might not have the language or creative capacity to ask for something that doesn't yet exist.
This is where solid human-centric design principles really come into play.
”Design is not just what it looks like and feels like. Design is how it works”. – Steve Jobs
A true design-led approach often creates an unfair advantage, far beyond aesthetics. Design-led products provide more engagement, better conversions, drive deeper brand affinity, and that's not even scratching the surface.
Our experience shows that every hour spent in the early design stages, especially detailed user research, can lead to significant gains, saving tens or hundreds of hours later in the growth process.
This is one unintentional lived-experience bias that is relatively easy to correct if addressed early on. Lived-experience founders have a very personal sense of the kind of audience or customer they are seeking, yet there is often a great deal of important nuance to be discovered in both the real audience and the reasons why they might want to become a customer.
It’s only by speaking with these would-be users, by listening to their challenges, concerns and the way they mitigate issues today, that you can really begin to understand the problem space. This is asking why they’d want a faster horse, what benefit they expect to gain, how they’d manage without one today, and who else this might benefit. In the spirit of Jobs’ thinking, these insights can lead to various ideas which can then be shown back to would-be users to gather even richer, more granular insights.
For more on how you can turn your lightbulb moment into a well articulated idea for both you and your audience, see our Product Visioning Worksheet article.
Lived experience is still one of the most powerful foundations a founder can build on. The passion, the grit, the deep personal understanding of a problem, these are genuine advantages that no amount of market research can replicate. But like any superpower, it comes with responsibility. The founders who truly harness it are the ones who stay curious, can hold their assumptions lightly, and let real human insight (outside of themselves) shape and sharpen the vision for their solution.
When you combine the fire of lived experience with the discipline of human-centric design, you don't just build a product. You build something that genuinely resonates, and that's where the real unfair advantage lies.
Let's see what we can make together.
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