Why startups will not “solve” loneliness

The business model of venture-backed startups is misaligned with the slow, friction-full, and local work of strengthening connection in communities.

In recent months, the Wall Street Journal, Business Insider, and TechCrunch have all featured write-ups about venture-backed startups attempting to “solve” the loneliness crisis. Loneliness, described as a multi-billion dollar market opportunity, is now a problem to be solved by a diverse group of Stanford MBAs, tech executives, and tech executives who were Stanford MBAs. 

To be clear, I don’t actually think solving loneliness is the intent of these startups. It’s a turn of phrase aimed at raising money and capturing media attention by tapping into a Surgeon General-induced cultural zeitgeist. What most are looking to do—if you read between the lines—is to make people more socially connected to others and their communities (and make a lot of money in the process). 

While these efforts may very well become viable businesses, they won’t actually solve loneliness and they likely won’t bolster Americans’ relationships or lives in community. Simply, the business model and ethos of business-to-consumer (B2C) venture-backed startups—which emphasize segmenting customers, reducing friction, promoting rapid growth, and achieving scale—are misaligned with the slow, friction-full, and local work of strengthening connection in communities. 

I’ve talked to dozens of founders aspiring to solve loneliness over the past year (perhaps, given my immense credibility as a Stanford MBA), and I’ve identified several traps that I worry their venture-backed startups might fall into. I highlight three of them here. For each trap, I explain how a specific facet of the startup model can lead to one or more unintended consequences that run counter to strengthening connection. This list is not comprehensive; rather, it is meant to highlight some of the overlapping pitfalls these startups will encounter in their quest to solve loneliness. 

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Trap 1 - The customer discovery process can lead to a fundamental misunderstanding of the problem and surface-level solutions.   

Customer discovery is an iterative process that early-stage companies take to “understand customers’ situations, needs, and pain points.” The customer discovery process for venture-backed startups typically entails conducting interviews with prospective customers and running targeted “experiments” or “tests.” This approach works well for customer pain points that are material in nature, such as simplifying online grocery ordering or making it easier to check your credit score.  

But for deeper, more existential issues like loneliness, the presentism of the customer discovery process may lead companies astray in several possible ways. First, what customers report wanting may be different from what they actually need. When it comes to relationships and community, prospective customers may express a desire for more choice, whether that be more options for people to meet or more options for communities in which to participate. In reality, the strongest relationships and thickest communities require commitment: what people actually need is to browse less and commit more. Second, companies may identify surface-level pain points that overlook the complex historical and structural drivers of disconnection. For example, prospective customers may report a refrain I hear often — “community outlets are hard to find” — and a startup may build an elegant platform that tries to match individuals to community groups. Yet, this would not address the root causes of our disconnection—not the isolating structure of our neighborhoods and built environment, not technology beating out community in a competition for our leisure time, and not our cultural shift from solidarity to individualism. 

Trap 2 - Pressures to increase pricing can lead to a premiumization of solutions that exclude the most disconnected Americans.  

Companies have two levers they can pull to drive topline growth: price and volume. Companies increase their prices to earn more revenue per widget sold. Companies attempt to increase their volume to sell more widgets. In comparison to traditional small businesses, venture-backed startups have aggressive topline growth targets—often measured in monthly or annual recurring revenue—that they set in partnership with their investors and boards. Failing to miss these targets could jeopardize future funding rounds and the very viability of their businesses. 

Startups working to strengthen connection that pull the price lever will be forced to focus on customer segments with the highest willingness-to-pay, leading to premium solutions for premium customers in premium markets. Unfortunately, this drives the exclusion of the groups in American life who tend to be the least connected: lower socioeconomic status people and residents of distressed places that have become civic opportunity deserts. Peoplehood, the new startup from the SoulCycle founders committed to building “high quality human connections,” is a prime example of these premiumization dynamics in action. With its flagship location in Chelsea and a monthly membership fee of $165, Peoplehood is financially inaccessible to the Americans who can benefit from connection most. While Peoplehood and other premium solutions like Groundfloor may end up becoming viable businesses, they are not solutions to isolation or loneliness. Rather, they are luxury services designed to improve the relationships and supercharge the networks of the most well-connected among us. 

Trap 3 - The venture-backed startup model built on speed and scale runs counter to how relationships are formed and nurtured. 

Venture-backed startups that pull the volume lever to hit their growth targets (which is where most B2C startups eventually end up) must continuously convert new customers. Such volume-driven revenue growth strategies are a function of two forces—speed and scale—and because venture funds are targeting 10x-plus returns for each investment they make, the speed and scale of these growth targets are often very aggressive. 

The rapid growth and scale toward which VCs push startups—and startups willfully follow—runs counter to how relationships and communities are actually formed and nurtured. This presents particular problems for startups looking to foster connections, both online and in-person. Reverend Jennifer Bailey describes how “relationships are built at the speed of trust,” and communities are built (and rebuilt) at the speed of relationships. Individual and group relationships take time to cultivate: the friction-full, messy work of meeting and getting to know another human is what makes relationships actually stick. And community does not scale—it’s a group of particular people grounded in particular relationships of care who share life together in a particular place. Consequently, startups’ efforts to create efficient, frictionless “customer journeys” at scale are antithetical to the slow, local, caring work of relationship- and community-building. Growth strategies that prioritize speed and scale over friction and place will, at best, promote fragile relationships over durable ones and loosely bound communities instead of tight-knit ones. At worst, they’ll exacerbate the problem that they’re trying to solve (see Facebook’s mission to “bring the world closer together”). 

A comparison of two neighborhood networks—Nextdoor and the Front Porch Forum—exemplifies the consequences of prioritizing speed and scale. Nextdoor received over $400M in venture funding between 2011 and 2021 before going public via a special purpose acquisition company, and is now operating in most neighborhoods in the U.S. Nextdoor’s rapid VC- and PE-fueled growth is the reason why it is the preeminent neighborhood social networking platform. Nextdoor is also, by many accounts, a neighborhood cesspool, sowing misinformation, distrust, and fear that fray the social fabric of communities. The Front Porch Forum, in contrast, is what Nextdoor could have looked like if it focused on trust and place. Rooted in Vermont and Upstate New York, the Front Porch Forum intentionally built a sustainable, bootstrapped business model from the start. This allowed it to grow slowly and purposefully, while designing its platform to promote friction over efficiency and trust-building interactions over reactive engagement. The Front Porch Forum is far from a neighborhood cesspool: studies have found that it strengthens the social fabric of communities, increasing neighborhood-level cooperation, belonging, and trust.

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I’m not under any illusions that people who are already building startups to “solve” loneliness will stop what they’re doing after reading this piece. If I were that compelling of a writer, I wouldn’t be writing a free newsletter right now. What I do hope, however, is that those building (or thinking about building) will at least pause and ask themselves a few questions:

• Have I done my homework? Entrepreneurs should seek to understand the structural drivers of disconnection—economic, social, technological, and cultural—to complement what they’re hearing from customer interviews. Read the recent research, yes, but also the people who’ve been writing about disconnection for the better part of the last century: Robert Putnam, Theda Skocpol, Charles Taylor, Robert Bellah, Wendell Berry, Robert Nisbet, Jane Jacobs, and Martin Luther King Jr. (just to name a few).

• How can I avoid the pressures of premiumization? Startups looking to foster in-person relationships should incorporate business models that promote financial access instead of exclusion. Sliding scale pricing models can work and are effective at promoting socioeconomic diversity and cross-class connection.

• Do I really need to take venture money? Startups working on promoting relationships and connection should aim to grow slowly and intentionally, centering trust-building over speed and scale. Because VC funding compels startups to prioritize rapid growth, entrepreneurs in this space should not take venture funding unless absolutely necessary to realizing their vision. 

There’s also a bigger question here, at least for me. Why is it that so many of us feel the need to turn to the tools of capitalism to solve problems related to human relationships? The logic of growth, without proper boundaries, can consume everything. And because the goal of venture-backed startups is exponential growth, we start by creating tools to serve our objectives, but we end up serving the objectives of the tools. 

When we call loneliness a market opportunity, we inadvertently commodify the very relationships that make our lives worth living. Loneliness is a problem to be solved, not because of a financial opportunity, but because each of us are deserving of care and love. 

We won’t find this care and love through an AI companion. We won’t find it through another therapy app. We’ll find it through the slow-moving, at times messy experience of particular relationships and locally rooted communities.

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