The Real Product-Market Fit

This article and related video interview from the experts at Y Combinator talk about what product market-fit is and how many founders want to pretend they have hit product-market fit. There is a great example of what fake product-market fit looks like.

4 minute read, 13 minute video

Key Quotes

“I often talk to founders who believe they’ve found product/market fit when they haven’t. This is a huge problem because they start hiring people, increasing burn, and optimizing their product before they’ve actually discovered what needs to be built.””

“I’m writing this post to help you understand when you’ve really found product/market fit.”

“Founders often hold too tightly onto solutions and too loosely onto problems. The problem, i.e. the market, is the real opportunity.”

“Your unique and special v1 idea on how to solve that problem is usually wrong and only through launching, talking to customers, and iterating will you actually find a product that reaches product market fit.”

“At Sequoia, they talk about finding customers who ‘have their hair on fire’.”

“As a founder, I never took the time to really understand what that meant and I thought it was just an investor marketing saying.”

“If your friend was standing next to you and their hair was on fire, that fire would be the only thing they really cared about in this world. It wouldn’t matter if they were hungry, just suffered a bad breakup, or were running late to a meeting—they’d prioritize putting the fire out. If you handed them a hose—the perfect product/solution—they would put the fire out immediately and go on their way. If you handed them a brick they would still grab it and try to hit themselves on the head to put out the fire. You need to find problems so dire that users are willing try half-baked, v1, imperfect solutions.”

Bottom Line

“Founders often try to signal they’ve reached product/market by pointing to their number of employees or a major round of funding. What I look for is a frantic founding team trying to deal with ever-growing numbers of happy, loyal, and ideally paying customers. Until then, stay lean, keep burn low, and resemble a Navy SEAL team instead of an Army battalion.”