The Consequence Engine: Is Your Startup Needed?

AI is impacting all walks of life. A couple of decades ago, Venture Capitalists (VC) might have struggled to find the right startups at the forefront of technology to invest in. Today, the challenge is completely different.

As AI automates many aspects of software application development, developing an app can be completed in a few weeks rather than several months or even years. So, we’re seeing a landfill of applications in an already crowded market. This leaves VCs overwhelmed when deciding which applications to invest in.

This story is about an overwhelmed investor who ironically decides to build an application to solve this investment challenge. 

The Challenge

Jasmin’s lips curved into a sharp, genuine smile, as she thought through her idea. She had finally cracked it! The question every founder should answer before writing a single line of code: Is the startup really needed? This was not about market fit or competitive advantage. It was about consequence, what would happen if it did not exist at all. She called her framework “The Consequence Engine,” and she knew it would change everything about how she evaluated ideas.

She was sitting in her high-rise office overlooking the sprawling, smog-kissed expanse of Silicon Valley. 

Holy shit! Nothing about applications felt holy anymore. They were abundant and largely pointless. She leaned back, running a manicured hand through her short, sharp haircut. For the last six months, she had been politely nodding while founders pitched ideas like a “blockchain-secured, AI-driven to-do list for seniors,” even though half a dozen apps already did the same job.

Innovation Crisis

The problem, Jasmin realized, was not a lack of enthusiasm. It was mostly the lack of original thought. The founders were all very enthusiastic, confident, and optimistic, but their ideas sounded similar. Every pitch deck used the same tired market justification: “We have a 5% UX improvement in the workflow, capturing a $30 billion TAM (Total Addressable Market).”

But what if the TAM was a poisoned well? Vast, measurable, and fundamentally unworthy?

The core issue, Jasmin realized, was the pervasive industry-wide shift from invention to optimization. Engineers, highly skilled, were no longer tackling grand challenges. They were stuck in an optimization feedback loop. They were not solving genuine needs. They were solving the problem of a button being ten pixels too far left.

The Data Revealed Market Saturation

She pulled up a spreadsheet filled with data from her last quarter’s pitch meetings, looking for patterns rather than promises.

• Task Management: 14 pitches (each promising “gamification” or “smarter prioritization”). 
• Social Photo Sharing: 9 pitches (each targeting a different micro-niche: pets, houseplants, gluten-free baking).
• FinTech: 22 pitches (all variations on lending or budgeting, with none focused on needs for example, wealth gaps).

This was the predictable consequence of the boom she had been analyzing. When an industry achieves saturation, talent does not disappear; it gets fragmented into smaller, more specific silos. The world needed fewer software engineers trying to build the 5,000th version of a calendar and more applying that talent to problems that were genuinely hard to solve and genuinely worth solving.

The Hidden Cost of Digital Waste

She looked out at the city, picturing the millions of lines of code being written right now. Code that required power, data storage, cooling systems, and constant hardware upgrades, all for the joy of letting someone filter a picture of their avocado toast with a new, slightly different vintage effect. The hidden cost of the attention economy was not just human time. It was Earth’s resources.

App Fatigue Was Real

Her eyes moved back to the spreadsheet. She recently came across the term “App Fatigue.” Users were getting overwhelmed by choice overload, the constant need to learn new systems, and the reality that they used only a fraction of the apps they downloaded. This overload results in users disengagement, making app discovery and adoption increasingly difficult. She thought she would add the word “useless” to “landfill of apps”. This could not be good for humanity, she thought. And yet, weren’t all these apps created to help in some way?

A New Framework for Startup Validation

Jasmin formalized her mental elimination technique, which she called the Zero-Impact Scenario (ZIS). The premise was simple: If an application were to vanish tomorrow, what would be the impact? The framework forced founders and investors to confront consequences, not intention.

High-Impact Applications (Pass the Test)

If a core transportation or logistics system disappeared, the supply chain would seize up, millions of people would be late or stranded, and entire economies would feel the shock.

Consequence: Global Economic Disruption.

Medium-Impact Applications (Require Refinement)

If a leading e-commerce site disappeared, consumers would quickly switch to a competitor, causing a short-term stock dip and operational turbulence, but no lasting harm.

Consequence: Consumer Inconvenience and Market Shift.

Low-Impact Applications (Fail the Test)

If DoodleDate, an app that matches people based solely on their ability to draw, disappeared, its existing 2,000 users would simply return to Tinder. 

Consequence: None. Zero Impact.

The Holy Shit Threshold

Jasmin coined the term “Holy Shit Threshold.” An application only passed the threshold if its absence would genuinely make someone beyond its founding team exclaim, “Holy Shit! We need that back right now!” If the consequence was merely a mild annoyance, the app was a drain.

It was time to introduce governance criteria. That criteria had to be baked into the due diligence process.

Three Pillars of Startup Evaluation

Her criteria formed three pillars:

1. The ZIS Score (Impact): Must demonstrate a high negative consequence if eliminated.
2. The Sustainability Tax (Resource Cost): Must provide a clear, measured estimate of its long-term hardware, energy, and cloud computing resources. And prove that the resource cost is justified by the ZIS Score (i.e., impact).
3. The Societal Gap (Need): Must address a real, current gap in society, aligning with underserved needs, systemic challenges, or meaningful improvements to how people live, work, or interact. It should demonstrably shape society for the better, not merely add convenience.

The Confrontation

Later that week, Jasmin called her senior partner, Anthony, into her office. 

“Anthony, I’m launching a new internal due diligence tool. I call it ‘The Consequence Engine.'”

Anthony, a man who treated every new idea with the cautious skepticism of a cat surveying a bath, raised his eyebrow. “The name sounds expensive, Jasmin.”

Risk Assessment Tool

Jasmin pushed her proposal across the table. “It is a strategic risk assessment tool, Anthony. We are no longer just investing in growth. We will be investing in permanence. She tapped the document, “Look at this.”

She showed him a projection based on the explosion of generative AI. “AI will allow founders to spin up a working MVP (Minimum Viable Product) in a single weekend. We are about to see the application pile grow by a factor of ten.” She paused. “This means a tsunami of low-quality, undifferentiated products. Our job is not just to find valuable investments. It is also to avoid the creation of excessive digital landfill.”

Anthony grunted, scanning the page. “The ZIS Score. Zero-Impact Scenario.” He looked up.“You’re rating applications based on the “What if they do not exist” scenario? That seems to be challenging innovation.”

“It’s rational,” she said. “Why would we fund an app that is slightly different from the one in the market when we could fund solutions to problems that are still unresolved?” She continued, “Incremental” ideas are easier to produce, especially now. But the real issue is that investors, firms like ours, keep rewarding them. That feedback loop is accelerating the problem. “There has to be a higher bar. One grounded in long-term meaning, real consequence, and durable benefit.””

The Case for Selective Investment

Anthony tapped the Sustainability Tax section of the “Three Pillars.” You are asking us to balance energy spent against the impact of the application?  Remember, we fund energy and many cloud investments!”

“Exactly,” she countered, leaning forward. “And the planet is paying for it, including humans! Do you know the global energy consumption of unused, abandoned apps? The server farms hosting millions of defunct codebases? And the app fatigue that is taking a toll on people? That is not a sustainable economy. We are creating technological e-waste at an accelerated rate. If an app does not fundamentally change human behavior for the better, the environmental footprint, the attention drain, and the hardware cost all outweigh its fictional LTV (Lifetime value).”

Jasmin added, with a wry smile, “This is where the humor comes in, Anthony. We are essentially building a metric that tells us, ‘Is this application’s contribution to humanity greater than its carbon footprint without adding to the general app fatigue?’ If the answer is no, it is not a viable investment. It is a digital parasitic twin of an existing product.”

Reorienting Investment

Anthony remained silent, finally removing his reading glasses. “So, you want to shift our focus from optimizing the convenience market to the global needs market. The stuff that is hard to monetize with standard ad-revenue models.”

“It’s hard to monetize now,” Jasmin corrected. “But the current model is broken. When the market is saturated, the only way to achieve truly exponential growth isn’t incremental improvement. It is solving a problem no one else has solved. Humans have been very good at that. It is just the latest AI-enabled market that has driven most founders to incremental innovation, and, at a point, one wonders whether all this is necessary. What I am suggesting will bring back focus to what is really needed and help founders channel their talent and innovation in the right direction.”

Introducing The Scarcity Index

“The Consequence Engine isn’t just a filter. It will be a compass. It will be a dynamic visualization tool for founders and VCs. It maps market saturation, calculates the ZIS score of the top applications in that field, and then, based on real-time global data from, for example, NGOs and other bodies, points to the white spaces that align with true human need.”

It would essentially tell a founder: “Do not build another ‘Y’ app (ZIS Score: Low, Saturation: Extreme). Go build a “Z” app (ZIS Score: Critical, Saturation: Low).”

This data, this map of genuine scarcity, was the ultimate competitive advantage. It was the only way to escape the gravitational pull of incrementalism.

The Irony

Anthony leaned back, a flicker of admiration in his eyes. “You’ve successfully taken a moral argument and framed it as a necessity for de-risking long-term capital. I hate that I like it.”

He paused, a chuckle escaping him. “So, we are going to build a piece of software whose sole purpose is to tell people whether or not they should build another piece of software. The irony is delicious.”

Jasmin grinned. “Precisely. We use the learnings from what is out there to carve out the space for the new one. The problem is not about talent. It is the lack of worthy problems being solved.”

Building the Prototype

She had already commissioned a small team to build the initial prototype. It would not be marketed to users. Its client base would be founders, corporate R&D departments, and fellow investment funds looking to shift their focus away from the crowded ‘delta-difference’ market.

She stood up, walked to the window, and watched the city lights begin to twinkle below. The world was clearly accelerating toward an application overload. It was time for a worthiness check. And she had the tool to do it. She turned back to Anthony.

Measuring What Matters

“We need a name for the new venture, Anthony. Something that reflects our mission, and the kind of impact we are seeking.”

Anthony, already lost in the numbers, muttered, “Something that screams, ‘This is necessary, not frivolous.'”

“Something simple,” Jasmin said, tapping her finger on the blueprint for her new platform. “Something that measures the gap between what exists and what matters.”

The Scarcity Index

The new venture was officially named: The Scarcity Index.

The world did not need more apps; it needed solutions. The Scarcity Index was her attempt to force the distinction.

Moral of the Story

Imagine each software application having a physical presence! We would quickly run out of space on Earth!

It is time we pause and assess what is happening. Each of us funding, creating, or contributing to an app should pay attention to the impact of its existence in the market. We should not just be blinded by an idea and the technology behind it. It is time that we now look together at the big picture for ourselves and for the place we inhabit.

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