Last Thursday at TechHub we had quite a riveting talk about what it takes to achieve product/market fit. Our guests shared with us some of their experiences with this particular challenge that product managers face and we thought they might come in handy for you too. So here they are:
What is Product/Market Fit? * Product/market fit is defined by the degree to which your targeted market wants your product. If 40% of your customers would be disappointed if your product ceased to exist, then you'd have product/market fit. * A high amount of requests, emails and phone calls from your customers inquiring about the product or requesting the product is also a good indicator that this objective has been met. * Bogdan argued that product/market fit means you have a disproportionate request for your product. It�s clear to see when there are a lot of people that need your product. That makes you go from push mode to pull mode. * Product/market fit is the only thing that matters and it encompasses 4 main elements: - Good product - Distribution strategy - The unique value that you provide - The profile of your client.
Generally speaking, there are 2 types of startups: * Transformative: they go to a market that never existed before (e.g. Twitter) * Normal startups that address existing markets.
What can achieving product/market fit help you accomplish: * after this stage, you can massively scale your product * you can get product/market fit before having traction * if you have product/market fit on a small niche product, you may discover market opportunities.
Being the first-to-market: * if you can commit to educating the market, then you are ready to tackle the issue of being the first to market * even Jack Dorsey (Twitter founder) was bashed on by investors for his idea early on, but he didn't give up * but even if you're a pioneer, remember to start by talking to prospective customers. This is because there are hundreds of ways you can build your product.
The role of the MVP (minimum viable product): * product/market fit is about using the product, it's about engagement. The MVP is a minimum set of features that solves the problem on the long term * You cannot achieve product/market fit before actually having an MVP * you can be lucky to have an MVP that achieves product/market fit, but most of the time you just have some hints and MVPs can be very misleading. The MVP can also be really expensive, because it has to be functional, so you have to carefully consider your resources * before actually building the MVP, go and talk to your customers * the MVP generally proves problem/solution fit, not product/market fit!
Product/market fit metrics: * The relevant indicator for product/market fit is not how many users you have, but how many of them are active and love your product.
Who is in charge with achieving product/market fit? * The founder should be mainly in charge of this, but also everyone else in the team * All your money and resources should be directed towards achieving product/market fit * there is no recipe regarding how much time the process should take � it�s very subjective and you have to be true to yourself. * If a founder gives up, the startup dies! Looking for product/market fit should be a learning experience: you get to really know the market and the clients. This is an intensely educative stage in a product's development cycle.
How does an accelerator help you achieve PMF? In an accelerator, they connect you to the market you�re serving. Given the very focused approach of accelerators, there is also more concentration towards exploring what works and what doesn't.
Useful resources about product/market fit: