A brief exploration of Customer Discovery, why understanding real customer problems matters, how companies like Airbnb uncovered hidden needs, and how empathy and curiosity lead to better products.

Reading time: 4 minutes

From corporations to consulting, start-ups and design thinking, the essence of the Customer Discovery process remains this: “fall in love with the problem, not the solution.”

This is exactly what customer discovery means, the process through which founders take off their blinders, temporarily let go of their “perfect” idea, and embark on a detective-style journey to discover what people truly want.

42% of start-ups because there is no real need in the market

The CB Insights report analyzes post-mortem accounts from over 100 failed startups, identifying the leading cause of failure as a lack of market need at 42%. 

This statistic underscores how founders often build products without validating real customer demand, leading to poor traction and eventual collapse. Some other key factors like running out of cash (29%), team issues (23%), and competition (19%), draw from founder reflections to highlight preventable pitfalls in early-stage ventures.

If there’s one lesson that keeps coming up when we look at why startups fail, it’s this: most companies don’t fall apart because the product was bad. In fact, only about 8% of failures are blamed on poor quality. The real problem? Strategic blind spots.

Far too many founders rush into building and scaling without truly understanding whether people actually need what they’re creating. And while the numbers shift a bit from study to study — some reports mention 35–38% — the pattern stays the same: lack of real market need consistently sits at the top of the list.

If you ask people what they want, they’ll tell you imaginary solutions; if you ask them what they’re trying to solve, they’ll show you the real problem.

What Customer Discovery Really Is

Customer Discovery is a process of deep exploration, where the entrepreneur tries to answer four fundamental questions:

• What are people trying to solve?

• How are they solving it now?

• What pains them the most?

• What makes them buy, and what would make them give it up?

Most importantly, this method has nothing to do with surveys, opinion polls, or assumptions. It’s about observation, open interviews, genuine curiosity, and empathy.

Most people have the same (wrong) preconceived idea of empathy. In reality, empathy can be described like this: it doesn’t mean feeling what the other person feels, but understanding that they may feel something you do not, and respecting that. Only then can you build products with people, not about people.

The Airbnb Example: How to Find Opportunities in a Marketplace

Airbnb offers us a great case study. The Airbnb model has a dual structure: travelers and hosts, each with their own needs, emotions, and friction points. From the company’s difficult early beginnings, the turning point came when the founders understood they needed to “do things that don’t scale.”

Marketplaces are difficult because there are two types of customers

Airbnb is a classic marketplace: supply and demand, each with completely different needs.

On one side, travelers want to:

• feel safe

• explore the city

• live authentically, “like a local”

• have a welcoming, not sterile, space

On the other side, hosts have different challenges:

• how to receive guests

• how to photograph the space

• how to clean and maintain the home

• how to set prices

• how to get good reviews
  
  
  

These insights clearly show that Airbnb didn’t invent home rentals. They facilitated a superior experience built on understanding the real friction points on both sides of the marketplace.

“Doing Things That Don’t Scale”: The Secret Behind Airbnb’s Growth

A key moment in the story is Airbnb’s decision to hire professional photographers in major cities to take better pictures of listed properties.

This decision goes against the usual startup advice that you should build only scalable things. Paul Graham popularized the principle “do things that don’t scale,” highlighting the importance of personal involvement in the early stages of user acquisition and relationship-building, critical for early growth, but not sustainable long term.

Airbnb did something unscalable but with huge impact:

• they improved listing quality

• they educated the market

• they increased trust in the platform

• they created a new visual standard

It was a tactical, deeply empathetic action based on a simple truth: ordinary hosts are not professional photographers.

This example is emblematic of the “doing things that don’t scale” philosophy: early in a business, manual, direct, personalized actions can remove major blockers, build trust, and massively accelerate adoption.

Why Customer Discovery Is So Important (and Difficult)

In the context of customer discovery, the central issue is that entrepreneurs are tempted to validate their own solution, not to understand the problem. This is due to confirmation bias, a thinking error that makes us remember, search for, interpret, and even prefer information that reinforces our existing beliefs and expectations.

When you do Customer Discovery correctly, you position yourself as an agenda-free observer who:

• listens without steering the answers

• asks open-ended questions (“tell me how…”)

• looks for behaviors, not opinions

• seeks extremes: the very satisfied and the very dissatisfied

• does not start with a solution in mind

So: curiosity + good questions + empathy = better solutions, better experiences.

Applying Customer Discovery Principles in Any Business

Customer Discovery isn’t just for tech start-ups — it applies to every industry, from retail and banking to education or even something as personal as choosing a wedding dress. At its core, the idea is universal: every business exists to solve a problem, and you can’t truly understand that problem without talking to the people who experience it. 

A good idea without a real need will always remain just an idea, and a real need without deep understanding will inevitably lead to mediocre solutions. When you ground your decisions in real conversations and real insights, you give your product the chance to become genuinely meaningful.