Paul has the last word on the "Silicon Valley doesn't tackle big problems" meme:
What I love is that Paul puts his finger on the biggest problem with thinking big--it's really hard to do big and good simultaneously.
"I think people underestimate how small big ideas were when they first got started. Microsoft's first product was an implementation of the BASIC programming language for a machine called Altair. There were probably a few thousand users, total. If those guys had presented that idea on Demo Day, investors would have laughed at them. But it turns out, everything has some adjacent territory, if you're energetic enough. It's OK to start out with a small idea. People are bad at looking at seeds and guessing what size tree will grow out of them.
The way you'll get big ideas in, say, health care is by starting out with small ideas. If you try to do some big thing, you don't just need it to be big; you need it to be good. And it's really hard to do big and good simultaneously. So, what that means is you can either do something small and good and then gradually make it bigger, or do something big and bad and gradually make it better. And you know what? Empirically, starting big just does not work. That's the way the government does things. They do something really big that's really bad, and they think, Well, we'll make it better, and then it never gets better.
The very best ideas usually seem like bad ideas at first. Google seemed like a bad idea. There were already several other search engines, some of which were operated by public companies. Who needed another? And Facebook? When I first heard about Facebook, it was for college students, who don't have any money. And what do they do there? Waste time looking at one another's profiles. That seemed like the stupidest company ever. I'm glad no one gave me an opportunity to turn it down."
Even Elon Musk and Tesla had to start relatively small, by retrofitting Lotus roadsters with electrical drivetrains, before bringing out the smash hit Model S. And Elon had the benefit of already being a successful two-time entrepreneur and billionaire.
Infamously, I was invited to the Google launch party and refused to go, believing that it was a waste of time to launch yet another search engine. Whoops.
Start with a small, good thing and make it bigger. Don't start with a big, crappy thing and make it better.