What is the Cold Start Problem as described by Andrew Chen?

A startup can use the concepts of the Cold Start Theory to grow by focusing on attracting the 'hard side' of their network. This could be sellers in a marketplace, content creators on a platform, or a specific demographic in a social app. For example, Tinder initially launched on a university campus and leveraged popular students to promote the app at parties. This strategy led to a large user base of like-minded individuals, which helped Tinder overcome the Cold Start Problem and grow.

Companies trying to solve the Cold Start Problem may face several obstacles. One of the main challenges is attracting the 'hard side' of a network, such as sellers on a marketplace, content creators on a video platform, or in the case of Tinder, attractive women. This is crucial as these are the users that add value to the network. Another obstacle is the initial lack of users, which makes the network less appealing to new users. Companies can overcome these obstacles by leveraging popular individuals or entities to promote their product or service, as Tinder did when it launched on the University of Southern California campus. They can also offer incentives to early adopters or find unique ways to create immediate value for new users.