The only thing that matters is getting to product/market fit.
And even fewer people are going after it in a systematic way.
Ive also added my favorite guides forfindingPMF.
What to look for pre-product
1.
Visible excitement
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Whether youre handing them a demo or if you drew something on the whiteboard.
Do they say, Youre not leaving or Where have you been all of my life?
For example, at Color early on, we were getting literal love letters from customers.
People are willing to pay for it now
Are people willing to pay you for this product?
Ask them this directly.
Even take a stab at get them to pay you now (i.e.
literally send them an invoice) to get early access to the product.
What to look for post-product
1.
If it flattens off at some point, you have probably found product/market fit for some market or audience.
Brian Balfour
Do a cohort analysis.
Look at a group of people that tried your product in a period of time (e.g.
during one month).
Then look at how many of those people continue to use your product later (e.g.
12 months later).
Casey Winters
Long term cohort retention is the best metric for determining if there is product market fit.
and measure the percent who answer very disappointed.
If that percentage is over 40%, you have PMF.
If the customer doesnt scream, you dont have PMF.
Because if they arent going to buy it at the end of the 30 days, they arent desperate.
And if they arent desperate, you dont have PMF.
Doug Leone / Andy Rachleff
3.
Sam Altman
Organic growth is the key indicator of product/market fit.
People love to seem smart and cool.
They want to recommend something great to their friends.
They dont need a share button to do it.
If they love your product, they will tell people about it.
Ideally more than 50% of your new accounts come from direct or organic traffic.
Examples of that would be PagerDuty, which had Apple as an early customer.
Zeplin, which had Facebook using them very early.
Airtable has all sorts of brands that have adopted it.
The lower the Burn Multiple, the more efficient the growth is.
This is a Measure of Product-Market Fit.
VCs will make inferences about product-market fit accordingly.
Andy Rachleff (starting at 4:30)
5.
Customers clamor for your product
you’re free to always feel product/market fit when its happening.
Money from customers is piling up in your company checking account.
Youre hiring sales and customer support staff as fast as you’re free to.
You start getting entrepreneur of the year awards from Harvard Business School.
Investment bankers are staking out your house.
You could eat free for a year at Bucks.
Pushing a boulder: dont have product/market fit.
Chasing a boulder: have product/market fit.
Both are very demanding, but feel totally different.
If youre still pushing the boulder, you dont have it yet.
When Twitter was constantly going down in the fail whale days, and no one moved off of Twitter.
That was a sign of raw market adoption.
