I’ve mentioned the importance of product-market fit many times in this newsletter. It’s important to startup success simply because some business ideas are better than others. When you hit on the right idea, everything seems to work much better. Grinding through a weak idea burns cash and destroys your motivation.
Ann Miura-Ko, of VC frim Floodgate, offers her perspective on product-market fit. There are other important ideas in her video as well so I recommend watching it.
“A lot of people when they say I’m raising my seed investment, they’re saying I need to get to product-market fit. And the problem with product-market fit is it’s this really nebulous concept. And what everyone believes it means is traction. But there’s no like map for how to get to traction.”
“In reality, you know, product is more your value proposition. The promise that you’re making to your customer of why the experience with your product is going to be an order of magnitude better than anything they would have expected. And so on the market side, it’s actually an ecosystem. And it’s your customer. It’s the person who pays, it’s your manufacturer. It’s the distributor, it’s all of the different people in companies that need to buy into what you’re doing in order for you to succeed and what is your value proposition to all of those people? And then finally, the third leg of the stool is actually your business model. How do you make money and most people leave this to the last minute to answer and I would say that’s probably as important as your product because if you don’t think about pricing, if you don’t think about how much people will pay, or how they will pay for it, or how they want to find your product, then you haven’t actually thought about the totality of your product.”
Business Opportunity: Product-market fit is a really important idea that’s worth your time to explore for your own business. MarketExamples, from above, has great product-market fit. Most newsletters never find that level of traction.
IdeaEconomy is not there, yet. I don’t have a simple, communicable idea that clearly conveys value for a particular niche. How about your business? Have you found product-market fit?