Let’s Talk: Product Market Fit
When you think of product-market fit (PMF), you may immediately think of customer satisfaction, industry standings, and the value created for the customer. This rings true and consistent across high-growth startups but many businesses seem to underutilize the understanding of PMF and the power it holds.
The definition? The PMF concept was developed and named by Andy Rachleff (who is currently the CEO and co-founder of Wealthfront and is a co-founder of Benchmark Capital). The gist of Rachleff’s definition for PMF was based on his analysis of the investing style of the pioneering venture capitalist and Sequoia founder Don Valentine.
How to Figure out your own market fit strategy
Much like the scientific method back in grade school, startups must go through a series of careful observations and apply rigorous skepticism about what is observed. To be constantly questioning your assumptions is crucial to understanding your target market and their problems. Much like our introduction science class’ budget, it is important to keep your own initial testing small and preliminary. There is a great deal of uncertainty and human error at risk to be testing a market too far along with your company’s growth.
“Founders have to choose a market long before they have any idea whether they will reach product/market fit.” Chris Dixon, VC, and American Entrepreneur
Once your company has PMF it still must curate a sustainable business model, find investors, understand competitors… But without a well-researched and absolute understanding of the market- there will not be any room and reason for long-term growth.