From Zero to One:
Finding Product / Market Fit
What exactly is product/market fit, and how do you know when you’ve found it?
At the WXR Fund, we work with very early companies that are building exciting products and preparing to scale. Along that journey, they are searching for product/market fit, an elusive sweet spot to which every startup aspires. We recently invited three experts to share their wisdom on what exactly product/market fit looks like, the tools and strategies to achieve it, and the pitfalls to avoid along the way.
Meet the experts:
Stephanie Hurlburt: Entrepreneur and Graphics Engineer. Co-founder of Binomial. Previously Oculus and Unity.
Tipatat Chennavasin: Entrepreneur and Venture Capitalist. General Partner at Venture Reality Fund.
Jordan Blackman: Entrepreneur, Game Designer, and Monetization Strategist. Founder at Bright Black.
Finding the fit: it’s all about the money!
Jordan Blackman: You won’t know if you have the right fit until people give you money. With no money, there’s no business, even if you think you’re building the right thing.
Opportunities will come left and right, but stay focused. Choose the ones that make most sense for your roadmap and long term goals.
Stephanie Hurlburt: Ask yourself early on if you really have to develop something to demonstrate the value of your product.
What’s the bare minimum needed to convince someone to buy into your product?
Get customers before developing.
Customer interviews are critical early on. Make sure you understand what your customers value most.
What friction points will people pay money for? Make sure you’re always going after this.
Justify and prove your decisions with data. This data should be measurable, i.e. “using AR in classrooms increased test scores by 10%.”
Choose the path that pays the most. This can fund other paths down the road.
Most importantly, always choose the people that want what you’re building. Focus on them during pilots and betas.
Avoid Pilot Purgatory
Don’t get stuck in indefinite unpaid pilot mode. Pilots should lead to some kind of return sooner than later. Define the right milestones for a successful pilot. Define them for your team and for investors.
Don’t let false positives trick you. Ask things like:
- Do people actually want to pay?
- Will they use this [ x ] app again?
Have people try great VR or AR first before showing them your product.
- They might be more excited about VR in general than your specific experience
As you develop your product, always ask: Are you solving a problem?
- Are you building the right features to solve the problem?
- Are you solving the right problem?
Always timebox pilots: define the start and end time.
- This takes pressure off of team. You don’t want ambiguity.
- This motivates the team.
- This also makes planning easier because you have an end date.
Be selective: When deciding who to partner with or pilot for, always choose the best opportunity. Don’t go with just any customer or pilot.
Time is industry specific, so be sure you understand the pace of yours (i.e. healthcare, education, enterprise).
Big company sales cycles tend to be 12-18 months longs. Prepare for that!
A prototype allows pivots, which saves you time down the road.
Identify the champion in each company you work with and ask them questions to make sure you’re on the right track.