Working with investors, how many times a day or week do you hear the phrase – when they achieve Product Market Fit or some derivative of it?
They haven’t reached Product Market Fit yet.
What is your route to Product Market Fit?
We will invest when you achieve Product Market Fit.
Companies that achieve Product Market Fit are five times more likely to…
Product Market Fit is more nuanced than the hackneyed comments we hear daily and is usually a dream at best during the early stages of development; a product might not find their sweet spot for a little while – if you were to ask one (or any) of the popular LLMs the peak of the time to PMF bell curve is around 2 years for those that make ever it (and if you ask the right one, you get citations too).
I found this chart looking for data on how long companies that we all know and love took to reach PMF and it is pretty compelling, right? You can see the article that accompanies it on Lenny’s Newsletter – the data is interesting and is further explored by Guillermo Flor on How to Get to Product Market Fit . Some of the data is skewed, there are pivots and definitions we might not all agree with, and how do you measure a feeling, but, look at those red circles spaced from 6 months right up to 5 years. One thing all those founders knew – the problem is real, people need this product. One thing that they all had – tenacity.
What is Product Market Fit?
Product Market Fit – When your Product perfectly meets the needs of your target market and your users have become enthusiastic in both using your product and recommending it to others. Hopefully you can be or become profitable, and you are definitely iterating based on customer feedback.
OK – What am I doing?
I love the agile principles of releasing early & often, moving fast & breaking things – be fast and let your customers tell you what is great or what sucks. Unless your concept was that stellar (and we are all saying always that execution is paramount….), the unmet need was seriously unmet and the hair was not just on fire, the whole head was melting, then building sustainable and meaningful (I see you vanity metrics) traction is unlikely to happen in the first few months.
So don’t sweat it – I like Marty Cagan’s B2B measure of PMF – the acquisition of your first 6 customers; and Sean Ellis’s equivalent 40% of your B2C users scream I cannot live without this product. If you are early stage though, getting your first B2B customer or a few evangelical B2C users should help you feel that are on the right path.
Remember in most common cases, across most verticals and strategies you will have some sort of MVP, that you are iterating and experimenting with and with which you are trying to prove:
- Usability/Desirability – Human values. Does it meet the user’s needs? Do they want your solution?
- Feasibility – Tech. Can we build this at all? In a sustainable way?
- Viability – Business. Can we build a profitable business around it?
I love that there are newer versions of this that added Ethical into the above list. Should we build it? And, you could argue that whilst, say OpenAI, meet the three criteria above, the impact that they could have could be seismic.
Once you hit this magical sweetspot, you can be confident speaking about the bright future of your Product.
Wen PMF?
Overall about 20% of seed companies get to Series A but in my experience PMF is much more selective than that. About 5% of seed companies achieve PMF in my experience and about 25% of the Series A companies I have reviewed have PMF, so about 4x more companies get funded even in normal times.
If you are pre-seed you can enjoy focusing on the problem you are solving, your early adopters and the solution that you are proposing. That stands whether your customer’s hair is on fire or they have no idea that they could ever need what you are about to build for them.
If you are asked about PMF during a pitch, you can confidently mention that for now you are on the right path to getting your product into the hands of the innovators and early adopters and will worry about the rest when you have some budget, but much more importantly the validated learning to build something and position it for the wider market. Lean on your knowledge of the space and love of the problem that you are solving, that in fact, you are uniquely positioned to solve.
In short, I find that authenticity helps a founder more quickly find product/market fit, recruit and inspire teams, and resonate more deeply with customers. All really important things.
Founder / Market Fit – Rob Go
But I would be remiss not to mention the SVPG version, the giants of Product Management:
We create MVP Tests (typically measured in days) in order to discover our way to Product Market Fit (usually takes months). We continue to evolve the product from this Product Market Fit state all the way to achieving the Product Vision(typically 2-5 years).
He then goes on to say you can achieve PMF per persona though, and I think that means that you really nailed down your product strategy and were super intentional with your initial go to market strategy…. you were right? Great, if you are a rockstar, or straight out lucky and achieve PMF in just months, then jump pre-seed and go raise the big money.