Part 2 — The quest to Product-Market fit

I find Product-Market fit very tricky. PMF as a concept is a binary matter: you either have it or you don’t. Pretty straightforward. However, the process to reach PMF is far from being as simple. It is more an art than it is a science.

Get lucky

To reach Product-Market fit, you’ll need to get lucky. Many never succeed.

In other words, founders who get lucky, are actually founders that move as fast as possible to give themselves as much surface area to get super lucky.

A good reason to pivot is you get another roll of the dice. It’s much easier to be lucky when you get half a dozen shots on achieving a goal than a single one, right? So, if we’re just guessing the statistics of how do I get PMF, taking several high-quality shots, I would argue you are creating luck for yourself and the odds that you actually hit something that works are much higher than someone that only takes one shot.

How to create luck? Talk to customers to understand their needs, change the idea as fast as you can and code day and night, as fast as you can.

Everything gets way easier if you move as fast as possible.

Learn

Everything you do, everything you ask, needs to serve one thing: learning.

The first goal here is not to sell your product, it’s to learn.

You need to optimize everything for learning. For example, don’t prioritize by creating a list “cost X benefits”. Instead, ask yourself ‘what is our biggest unknown that would rewrite our priorities’.

You need to contradict your vision and have a genuine interest in seeking the truth.

When a surprise happens — either an upside surprise or a downside surprise — that’s the market speaking to you trying to tell you something you don’t yet know. And so, you need to listen

What is the process?

“Discovery beats planning, so plan to discover”, Bill Barnett.

Success is almost never planned. No company is ever executed on every aspect of its original pitch or business plan. But that doesn’t mean success is random. Instead, it’s found through the Discovery Process.

PMF emerges from experiments conducted by the entrepreneurs. Through a series of build-measure-learn iterations, PMF is discovered and developed during a process rather than a single Eureka moment.

I found the best process is described by David Rusenko:

Have an open mind. Develop assumptions. Repeatedly test hypothesis. Launch again and again. Fail fast and cheap.

How to talk to customers?

Interviewing customers is probably the most important task to be performed on a daily basis while looking for Product-Market fit.

Customer interviews surely would deserve a full article. But based on The Mom Test book, the three commons errors are:

Talk about their life, not your idea Talk specifics, not hypotheticals Listen, don’t talk

And the five great questions to ask are:

What’s the hardest part about (doing this thing)? Tell me about the last time you encountered that problem Why was that hard? What, if anything, have you done to try to solve this problem? What don’t you love about the solutions you’ve tried?

How do you know when you reach PMF ?

You will know when you have achieved PMF when customers start beating a path to your door.

Product-market fit really means finding a group of customers who are desperate for your product. If they aren’t desperate, it means there is likely a good alternative.

Andreessen argues that “The product doesn’t need to be great; it just has to basically work. And, the market doesn’t care how good the team is, as long as the team can produce that viable product. If nearly everyone at the business is focused on trying to fulfill product demand instead of “sitting around” trying to dream up new features to create demand, there is almost certainly PMF — but the reverse is not the case”.

You haven’t reach PMF when growth is not your biggest problem.

When you don’t have it, everything feels hard. When you do have it, everything is easy and most of the moves you make work.

Some metrics can help you know if you have achieved it:

Returning usage (Day 1, 3, 7, 30 retention).

(Day 1, 3, 7, 30 retention). Net Promoter Score (should be >50).

(should be >50). Paying customer renewal rates (cohort-based).

(cohort-based). Ask users “how would you feel if you could no longer use the product?” and measure the percent who answer “very disappointed” (Should be >40%). Rahul Vohra from Superhuman gives more details here.

What if you don’t reach Product-Market fit?

Most people never find PMF.

If you don’t have PMF and you have given the idea your best, then it can be easier to reach PMF by changing ideas, rather than continuing to throw valuable time and money after it.

Here’s the advice when you are looking for an idea to pivot to: