What is Product-Founder fit and do you have it?
The founders' idea-validation journey from initial idea, testing market demand through the existential question of whether you should even be doing it in the first place...
Today a crucial topic when it comes to business building: whether or not your idea has legs.
Typically, this is the concept known as idea-validation or product market fit.
I’ll explain how I see these as two separate things, and introduce a third layer that is sorely missing from the traditional narrative: Product-Founder fit.
Many clients come to me and say they need to validate their business idea.
Idea validation is a process that starts with your seedling of an idea and ends with a paying customer. It consists of gathering real evidence that your ideas have legs, earnt through methods of experimentation whose outcome allows you to move forward with a decision that has been ‘de-risked’. The decision to pursue one idea over another derives from the proof you gain that your idea is viable. Crucially this process happens before you release the finished version and go to market with it. It allows you to test something before investing too much time, money or energy in the wrong thing. Proof might be in the form of market research and survey responses, user testing, paying customers, or building an audience.
Following on from the idea validation stage comes the part where you check that the market demands enough of your product or service to create a viable business around. A business that can continually pay the bills. This is the question of Product-Market Fit.
I’ll be teaching many readers to suck eggs here: product market fit is the holy grail of startup building and is the core axis upon which most investors base their investment decisions. A look into the data from CB Insights as to why startups fail, you’ll see that “No Market Need” accounts for the reason that over 40% of startups shut down.
It’s about whether your product has enough demand, whether the timing is right (some products are way ahead of their time) and whether the price point, aesthetic, delivery method (the packaging) line up to customer needs and expectations.
The ‘product market fit’ question tends to lend itself most to businesses that exist within the spectrum of new, innovative products and technologies not yet proven. Its a quintessential startup concern.
Not every business needs to look for ‘product market fit’.
Those businesses operating inside well-established industries should be able to get themselves up and running with repeat customers in no time. Pest control businesses for example, probably aren’t doing a lot of validation per se. Pests exists, and people don’t want them in their homes. The market needs this product and you already know it.
What is increasingly of interest at least to me anyway, as I wrote about in this last post on the different entrepreneurial career paths available, the internet has created new models of entrepreneurship. From creators, gig-economy workers, thought-leaders, influencers, to indie hackers. These are worlds away from your hairdresser, baker, builder or pest control business of the offline world.
Product-market fit is needed each time a new product is created, or a new model of entrepreneurship is built.
That’s because for many of these new paths they are also designing a new business model around themselves. This is especially true in the creator landscape where individuals are creating from their unique talents. They have to be the best (or good enough) at that thing in order to validate the business they are building to create a sustainable living around it.
I have been doing this validation process with my own coaching business The Ask. Whilst coaching is a proven market demand (projected $20bn industry by 2022) my model of coaching requires its own validation. What kind of coaching am I best placed to offer?
To test and then validate who I am coaching, what their problems are, how I will solve them, and at what price point and timeline. Furthermore, should this be on a 1:1 basis, in a group, delivered via materials or through conversations? I’ve iterated on these decisions over the last eighteen months. Read on to to see where I’ve landed!
I’m now able to support my clients with these decisions as a coach.
Meta, I know.
My whole career been built on helping others with their careers so I’m used to seeing my own thoughts reflected in my clients’ world-views.
Out of the seven clients I’m working with on longer-term coaching engagements, six of them I would describe as being in their validation stage. The validation stage is an ongoing one that you are never really ‘done’ with until the point at which you have reliable income streams from the same offering for a sustained period of time.
The missing piece.. Product/Founder Fit
I’m here to share my key belief that before you get to the idea validation/product market fit stage, there is an important stage you need to go through first as a founder.
This stage that doesn’t just ask ‘is there product market fit?’ but asks ‘am I the person to build this?’.
Sure the business need might exist, the market may be ripe for it, and the customers ready to hand over their money. But when the rubber meets the road, are you the person to deliver this thing?
Most pressingly, do you want to live a life that requires to you create this product or service multiple times over?
This, I call the Product-Founder Fit (PFF).
On a discovery call with a potential client the other week he described his current challenges as a founder. His business creates beauty products and requires lengthy procurement and negotiation processes with manufacturers, suppliers and distributors. There is a lot of contracts and operational components that dictate whether or not the execution of his business will succeed.
If that were me, I would flounder.
I am neither excited by nor well-suited to managing highly complex operational systems or projects. Whereas for some people like him, this scale and complexity excites them and creates the perfect combination of challenge, excitement and alignment with their natural gifts. This allows them to create from a place of ‘flow’.
We could run this same thought experiment against any business.
The difficulty is in the fact that it can be hard to know what the actual day-to-day of a building a specific business would entail until you are actually in it. What the business does might sound appealing e.g “helping underrepresented founders gain access to capital” but what you do as the founder in order to make this business a reality, could be less enticing. Read: asking rich people for their money.
So before creating the perfect product, consider what kind of business you want to build and what kind of problem you are uniquely placed to solve. There are a myriad of factors that go into this.
The factors around whether you should build this business come back to the questions you need to answer for yourself.
— What does your story and experiences in this world dictate that you can do?
— What is your appetite for risk?
— What balance of innovation vs certainty are you looking for?
— What does your unique blend of strengths, talents and skillset best lend itself to building?
— What obsessions and passions do you have?
— What kind of life do you want to design for yourself?
— What does success look like to you?
This is my Product Founder Fit with The Ask
Still on the meta theme here.. but answering these questions above with my clients, is what I have ‘validated’ as my coaching specialism.
I will be dedicating my research and energy into supporting new and aspiring founders to answer these questions so they can build a company around themselves. I have seen time and time again how in the early stages of business building what keeps so many people stuck is a lack of clarity and confidence.
You can find that clarity and confidence by understanding how you are wired and what you are capable of doing, and what mission you are uniquely solved to work on in the world. In the early days of business building when you could do literally anything, where do you start? I believe it starts with you, and truly understanding who you are and what you care about at the deepest level.
This process is one I have been through on myself, a number of times, and one I am taking clients through now. After a decade supporting entrepreneurial talent and interviewing thousands of people, my unique skills as a coach and headhunter have allowed me to guide people through these questions and design the right business for them.
Ready to build a business as unique as you are?
I’ve got space for two clients to work with me one-to-one in April so you’ve been wondering how you unlock your potential and validate the right business for you specifically, get in touch for a complimentary discovery call.