I’ve recently started binge-reading blog posts about product/market fit.
I’ve picked apart Marc Andreessen’s Pmarca blogs, in particular his post titled: “On product/market fit for startups.”
I’ve read and re-read Andrew Chen’s posts/presentations about “Minimizing Time to Product/Market Fit“, “When has a consumer startup hit product/market fit” and “Zero to Product/Market Fit.”
I’ve gorged myself on Alex Turnbull’s “Journey to $100k a Month” (favs include: Lessons Learned from 0 to $30k a month and How we got our first 100 paying customers in 24 hours)
In fact, I don’t know why we still call it “Product/Market Fit” when it should really be called “Market/Product Fit” because you need to start with the right market, then build a product that fits. Sounds pretty simple, right?
In the beginning, every entrepreneur is looking for product/market fit whether they know it or not. In our first failed attempt at building a product, we didn’t know what we were looking for. We idolized the now-defunct mantra of “Build it and they will come” and didn’t fully understand our market. After that experience, we vowed to do extensive market research before building a product and to never make the same mistake again. And yet, just a few months later, we found ourselves repeating history for the second time.
Even though we knew the theory of finding product/market fit, we still ended up building a product with no paying customers. How did that happen? Were we in some sort of twilight zone? It was really frustrating. I tried to break down why it was so hard to find product/market fit.
Practice Makes Perfect
Unfortunately my startup founder and I were not bred from an early age to hunt for product/market fit. We were engineers and while we could solve problems, the problems had to clearly exist before we could solve them. In the real world, you do not have the luxury of having clearly defined market problems laid out in front of you.
What exactly does product/market fit look like? I think the more times you try to find product/market fit, the better you become at successfully identifying it. Essentially, it is a skill that can be honed. My proof? Those who make a living as a sales representative have practiced their entire career figuring out market problems and fixing them. My girlfriend is a sales rep and she has her sales pitch down to a science; almost to a point where it becomes instinctual.
Each question she asks a potential customer is carefully formulated to reveal their needs and wants. Being able to sell effectively is a glorious skill set to have. This brings me back to my point of how practice makes perfect. I wish when I was younger I had worked in retail, or sold Cutco knives, or even started a lawn mowing business because the more times you try to figure out product/market fit, the better you become at realizing what it looks like.
Customers are Confusing
The most confusing part of finding product/market fit is talking with customers. I’ve read many articles saying things like “listen to your customers” and “customers don’t know what they want” and “make something people want” and “sometimes you have to say no to customers”. Well make up your mind!
Researching a market by talking to potential customers is frustratingly confusing. I’ve realized that you can’t just ask customers, “What are your problems/obstacles/bottlenecks/etc?” The question is often too broad and unfocused. There are two main ways to even get close to a problem. (1) Trial and Error – You have to ask them if they have a specific problem and they’ll be able to say yes or no. (2) Observation – Go through a process with them and the problems will likely surface.
And even then, people will lie to you! It’s not necessarily out of ill-will, but maybe they’re too nice to tell you that your idea sucks, or maybe they believe one thing but actually do another.
Ultimately, you’re trying to figure out “What does a good market look like?” If five people say they like your idea, three of them say they want more features, seven of them say they’d try a beta, but 25 of them outright said no, is that market good enough to build a product for? And if you do build a product and none of these people become paying customers, did your market research fail you? Maybe you just needed to talk to more than 40 people.
It takes a lot of time to identify product/market fit. If you watch this video by Steve Blank, you have to figure out the right market, build a prototype, test assumptions and then either verify or pivot. Most ideas likely pivot, but each pivot takes time. Each idea may take months to validate and you only have a limited runway. Ideally, you would do much of the validation upfront before you start building a product. But entrepreneurs are inherently restless. They want to research fast, build fast, and validate fast.
There’s also a mental expectation that is psychologically intertwined with this process. If you had quit your job and after three months didn’t even have a prototype built, you’d look like a fool. But what if, in those three months, you had interviewed 1000 people and gone through 10 ideas? Do you know how long it would have taken you to build prototypes for 10 ideas? But no one cares about that.
For SaaS startups, you have to spend most of your time networking and building relationships to even get the opportunity to ask the right people the right questions. Even if you were in the same industry as Cisco, do you think you’ll get the chance to ask Cisco’s VP of Engineering about his problems whenever you want?
I also think entrepreneurs sometimes fall into the trap (guilty as charged) of finding a handful of anecdotal evidence of a user need and then going full steam on product development, only to find that the evidence is, in fact, anecdotal and hearsay. This ties into my previous point about confusing customer research. Ultimately, time is an entrepreneur’s biggest liability and the longer you spend not finding product/market fit, the riskier everything becomes.
I think as entrepreneurs, we get scared if we aren’t constantly working on a physical product or a prototype to show people. That becomes our only proof that we are doing something. But that’s not true. Successful startups begin way before the product is built. Nobody just talks about that stuff.