Here's what to do:

(1) Problem. Pick a "big ass" problem where the
first good or a much better solution will clearly be
a 'must have', not merely a 'nice to have' and will
be very valuable, in the sense of making money, the
green kind. Note the "clearly". If pick a problem
that does not satisfy "clearly", then try again. I
didn't say that the success would be easy to do.

Part of the reason VC has been "digging in the wrong
place" is that it tries to make money with small
problems, where the solution is just 'nice to have'
instead of 'must have'.

The ideal example of a 'big ass' problem, although
not in information technology, would be a safe,
effective, cheap one pill cure for any cancer.
"Breakthrough"? Yup. "Crazy"? Sure; NIH has been
throwing billions a year at that. But it would be a
'must have'; no question about 'product-market fit'.
A 'must have' doesn't have any questions about
'product-market fit'. If looking at projects where
the results have some doubt about 'must have' and
likely need to work on 'product-market fit', then
are looking at the wrong projects, are "digging in
the wrong place".

Another fad for teenage girls does not qualify as a
'must have'. Yes, such a fad might make a $1
billion, but it is too difficult to evaluate.
Instead, I mentioned "clearly" be a 'must have'.
That is, it is crucial to be able to get a good
evaluation early on, and nearly never can do that
with fad products, as, indeed, the Andreessen
remarks so clearly indicate.

(2) Solution. Find the needed solution. Often the
solution will not be easy to find, but this need not
concern VCs since they need look only at deals where
a solution has already been found. If can't find
the needed solution, then return to (1) and try
again. A solution that is difficult to find can
give a technological barrier to entry.

Q. Whatever you are working on, someone else
has already done that.

A. Let's consider that: Take all the people who have
done that. Then, except for rare ties, there must
have been a first such person, and for them no one
else had already done that. So, the claim is false.
Sorry 'bout that. Instead, there really are things
that are significantly and genuinely new.

Q. Then someone else can just reproduce the solution.

A. Some solutions are quite difficult to find, may
be based on original work and/or advanced
prerequisites understood by only a few people,
implemented in software, secure inside a server
farm, and, thus, provide a technological barrier to
entry.

(3) Prove that really have a solution as described.
When have such a proof early on, usually it is just
on paper, especially for solutions in information
technology. Is this possible? Yes, for nearly all
of science and engineering on practical problems,
it's routine and standard. It's how we build a new
airplane engine, a new airplane, a new rocket, a new
satellite, a new application of carbon fiber, etc.

(4) Evaluate the paper solution. Can this be done?
In nearly all of applied science and engineering,
such evaluations are standard and routine; it is
insisted that such evaluations be done. No one puts
up a new satellite with 'agile' techniques
iteratively 'searching for product-market fit'.
There's no counting on "magic". Fads of teenage
girls are just irrelevant.

(5) Develop the solution.

(6) Deliver, sell the solution, the first good or
much better "must have" solution.

Can these six steps be done? Sure; history shows
that there's no doubt. Thankfully for US national
security, the best examples are funded and exploited
by the US DoD.

A great example was the SR-71: Problem: Get
pictures of the USSR. Solution: An airplane that
can fly at Mach 3+ at 80,000+ feet for 2000+ miles
without refueling. Proposed essentially just on
paper by Kelly Johnson and the Lockheed Skunk Works.
The project passed evaluation and went ahead as
planned.

Other examples: GPS and the earlier version by the
US Navy -- proposed on the back of an envelop by
some physicists at the JHU/APL, A seafloor, passive
sonar array. The F-117 stealth plane; flew across
Saddam's anti-aircraft artillery without a scratch;
another Lockheed success. The Keyhole satellite,
that is, a Hubble but aimed at earth.

Outside of the US DoD, the LHC; found the Higgs as
planned. The WMAP satellite -- found the details in
the 3 degree K background radiation as planned and
got enough resolution to permit an estimate of the
big bang 13.7 billion or so years ago.

These projects were evaluated essentially just on
paper and worked as planned.

Generally such science and engineering has a much
better batting average than VC. E.g., in each case,
the SR-71, GPS, the LHC, WMAP, there was a problem
that needed a 'must have' solution, such a solution,
evaluation just on paper, and success. No "magic".
No getting 3000 projects, looking carefully at 200,
picking 20, and having 10 fail.

What should VC do? Sure: Stop "digging in the
wrong place" and, instead, follow steps (1) - (6).

Will VCs get many such project proposals? Well,
likely now they get more than they are willing or
able to evaluate, but with interest in and success
with such projects, they stand to get more such
proposals. Considering how few VC projects pay off
now, VCs don't need to get more than a few dozen
good proposals each year. Digging in the right
place doesn't require moving much dirt to get to a
lot of gold.