Road to Product Market Fit

Everyone talks about it, but most never achieve it - Product Market Fit. How to certainly never achieve PMF? By focusing on the wrong stuff.

What is Product-Market-Fit (PMF)?

Even people that think they understand Product-Market-Fit often times misunderstand its true essence. So let's try to get everyone on the same page.

Just because you have Sales doesn't mean you achieved Product-Market-Fit. Of course making sales is great and usually is a strong proof that you are on the right path, BUT without renewals you will have a very difficult time scaling your company.

Ok, but how do we even get to market fit and then later product market fit? First things first, there is no silver bullet - but as so often you can significantly increase your odds.

"A product without revenue is not a product, it's a hobby."

This is the first lesson most first-time founders have to learn. In our experience founders focus on different aspects in their business depending on their seniority.

First time founders

First time founders usually focus on Product. Which is nothing bad inherently, but the approach makes it unlikely to build something that is actually accepted and desired by the market. The harsh truth about building products is nobody cares how good you think your product is, how passionate you are or how much effort you've put into it.

The only thing the market cares about is whether you save your customers time, give them a great time ("experience", e.g. for entertainment) or if you actually make their life's in some way better or less painful.

Second time founders

After learning the hard lesson that "Build and they'll come" doesn't work (anymore) - most second time founders usually focus on distribution. They recognized that they actually need to sell their product. That they have to have a plan to get traction on the market. While this is much better than solely focusing on features, and building a product you think people will like - it still means you try to sell something and hope that the market buys it.

Again, the market doesn't care what you have to offer (except they really like and trust you). But then this at most gives you a handful of sales and high churn - except you got lucky by offering something the market truly wants.

Nonetheless, this is usually the business where founders learn a lot about Product management - building products people like. They usually start talking with their clients, and try to understand the market (at least in the very beginning).

Third time founders

This might be a bit out-of-place, but third-time founders most often focus on people. They learned the hard way that (most experienced) investors invest into people - not their idea, that people are not machines, that their team has other aspirations and that they might not work as hard as they do.

As a consequence the founders have to learn how to align incentives, how to create a company vision that is compelling enough that their individual employee's vision for themselves fits into that.

Why is this important for achieving Product-Market-Fit you may ask? Well getting a company off the ground is a heavy undertaking, no matter how much AI you use - you usually need other people to grow and to achieve PMF. Furthermore, learning the skill of aligning incentives, also is directly tied to understanding aspirations from your potential clients, understanding their true underlying pain points so that you can sufficiently solve them.

Fourth time founders

And now comes the kicker, fourth time founders often times focus again on Product. But in considerations with the previous lessons learned. They understand that true Product-Market-Fit means that people buy repeatedly, and most importantly love your product so much that they tell their friends. This is when exponential growth can happen.

Fourth time founders, or just "seasoned" founders understand that achieving PMF is purely Try and Error. We've talked with so many successful entrepreneurs on our podcast, who sold their companies for +$100 Million or hit it big in some other way - they all talk about this in a similar fashion.

Of course the above is all highly generalized, but it's a nice thought model and pattern that we can regularly observe in clients, founders and former entrepreneurs (often times investors now).

Fast track to building successful products

So, how do we acquire the mindset of a "fourth time founder" without failing 3 times? Mindset can't be thought - but you can listen to podcasts, read books or just really force yourself to focus on what you now know to be important:

Understanding the pain points of your market well enough, that they are so grateful they sell your product for you.

Alternatively, you can hire experienced people in your team - if you can afford them of course. Or you hire an external Product Studio like ourselves (subtle sale 🍫🐌) - we also do offer free Product Market Fit sessions by-the-way (you can book a free slot here).

So, how would you build a product people crave and love? The unfortunate truth we heard from nearly all hyper-successful entrepreneurs is: It's always try & error sprinkled with luck.