Behind the Grind: Lessons from a Product Leader, Episode 1 – Rethinking Product Market Fit, Startups, and Founders
November 18, 2021
Through the various stages of my startup career*, I’ve been fortunate enough to work with a lot of first-time founders and dive into the philosophies that drive new product development – what makes a good founder? What really defines the work at a startup vs. at a big tech company? And, how does one know if they’re ready for the grind in front of them when founding a startup?
What I’ve found in my various early-stage experiences over the past decade (plus) is that the core zero-to-one work — the stuff that Peter Thiel talks about here — is, at its core, mastering a somewhat well-defined methodology (plus having a lot of luck). What it isn’t, as people often lead others to believe, is a magical set of innate skills reserved exclusively for the Elons, Zucks, and Dorseys of the world. In the first post of this series, Behind the Grind: Lessons from a Product Leader, I’ll redefine three key concepts to answer the questions above, namely Product-Market Fit, Startup, and Founder. By rethinking how we treat these terms (which are often used as jargon), we can build upon a more focused approach to early-stage product development.
What is “Product Market Fit?”
First, it’s important to get a general sense of the definition of Product Market Fit. It’s a term we’ve all read/heard a seemingly endless number of times in Medium posts, on Twitter, and through podcasts, but how do we define it? Just Googling “Product Market Fit” can send you down a two-hour rabbit hole, so to simplify that journey, I’ll fast forward to the end by cherry-picking my favorite definition from the OG, Marc Andreesen, from a 2007 blog post:
Product/market fit means being in a good market with a product that can satisfy that market.
You can always feel when product/market fit isn’t happening. The customers aren’t quite getting value out of the product, word of mouth isn’t spreading, usage isn’t growing that fast, press reviews are kind of “blah”, the sales cycle takes too long, and lots of deals never close.
And you can always feel product/market fit when it’s happening. The customers are buying the product just as fast as you can make it—or usage is growing just as fast as you can add more servers. Money from customers is piling up in your company checking account. You’re hiring sales and customer support staff as fast as you can. Reporters are calling because they’ve heard about your hot new thing and they want to talk to you about it. 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 Buck’s.
(Note: if you want to read more about Product Market Fit, this post by Rahul Vora, CEO of Superhuman, on the First Round Review blog is an excellent resource.)
From my personal experience, it’s pretty easy to observe and feel when you have Product Market Fit; when you don’t, you may efficiently be on your way toward achieving it, or you may be nowhere near it. And, as you may have guessed, all of the product metrics, customer interviews, and press coverage in the world won’t give you a definitive answer. It is in this “on the journey toward Product Market Fit” phase where founder conviction, product sense, and smart risk management about how to spend your very finite resources comes into play.
Then, what is a “Startup?”
So, if we take this understanding of Product Market Fit at face value, we can redefine how we think about “Startups” and “Founders.” In this framework, a Startup can be defined as a set of individuals striving to find Product Market Fit at any point in time. As you can imagine, the work required of an early-stage startup compared with that of a company in scale mode is vastly different. A good representation of this can be seen below, taken from Nithyl Singhal’s excellent post on the First Round Review blog and slightly annotated:
If you were to zoom in on the actual work being done by the teams in the pre-Product Market Fit stages (“0 to 1”) and the post-Product Market Fit stages (i.e. everything to the right of “1” in the graphic above, or simply “1 to n”), you would see two different groups of people that just happen to be working on the same product for the same market. You would NOT see a single company’s smooth, linear journey to massively scaled success. In actuality, there’s very little about the “0 to 1” journey that resembles that of the “1 to n” journey.
The “0 to 1” stage is really the defining condition of a Startup, i.e. where the magic truly happens. It’s just convenient to use the term “Startup” to describe companies in the “1 to n” stage as a nod to their origin story. But, at this point, they’re really “Scaled Companies” with a completely different set of challenges in front of them.
As a quick but relevant aside: the graph above shows the product trajectory of a Startup into a Scaled Company, but what about the emotional journey for those building Startups? Well, that looks more like this painfully accurate (#flashbacks) example from Paul Graham, founder of the storied Y Combinator:
So then, what is a “Founder?”
Now that we have redefined Startup in the context of its journey to find Product Market Fit, let’s reassess the role of a Founder. Extending the thinking above, it follows that a Founder is an individual in charge of finding Product Market Fit within a Startup. Specifically, a Founder is running a race whereby they are trying to get to the Product Market Fit inflection point before running out of gas. In this context, “gas” is a combination of at least the following finite resources: money, time, and personal grit/perseverance.
Across all the roles I’ve held, and all the experiences I have under my belt, the following simple north star should define a Startup Founder’s role: if you can reach the finish line, as defined as the point in time at which you’ve definitively found Product Market Fit, before consuming the resources required to get there, you win; otherwise, you lose. Like so much of new product development, it’s an idea that’s simple to understand, yet incredibly difficult to attain. And that’s one of my heuristics for Product Thinking from First Principles: Is it simple to understand, but difficult to attain? If so, we’re moving in the right direction.
Episode 2 Preview
I started this post by asserting that the work of Founders in a Startup to find Product Market Fit is actually based on a well-defined methodology that one can learn over time instead of some magical innate quality. So, what does the work look like and how does one become proficient in it? We’ll tackle that very topic in Episode 2!
*Early-stage PM, founder, builder in corporate incubators like Google’s Area120 and Facebook New Product Experimentation team, and active angel investor/advisor
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