Product-Market Fit is Not the Only Fit
The famous PMF (product-market fit) equation has become a key prism through which we (founders, investors) examine the maturity of startups’ offerings vis-a-vis the target market they’re tackling. While this original equation is important in and of itself, I believe that the dynamic it represents between two factors (product, market) and their interrelationship is the key here. There are several other such “fits” I often use and believe to be worthwhile in examining different key aspects in a startup journey.
The Founder-Market fit is actually a more useful equation to use for earlier stage examinations. Oftentimes, founders are baffled by which target market they should tackle, feeling as if there’s no one single target market that is “healthy” enough for them to devote their efforts to. As several quick examples, you often hear that salespeople are (ironically) hard to sell to. Developers have their own preferences and it’s highly difficult to change their ways. Other departments don’t have a significant enough budget. The cyber stack is overcrowded. So if all of these target audiences aren’t optimal - what’s the answer? Who should you target? Well, it’s all about founder-market fit. A single target market can be the right one for one team and the wrong one for another.
So if all of these target audiences aren’t optimal - what’s the answer? Who should you target? Well, it’s all about founder-market fit. A single target market can be the right one for one team and the wrong one for another.
Founder-G2M Strategy fit is another interesting dynamic to look at. Some founders are clearly well positioned for a PLG (product-led growth) play, supported by their past experience in carrying out a marketing-initiated effort of a self-served product. Other founders have a more intuitive understanding of enterprise sales. It really depends on the specific skill sets the founding team either brings along with it or is naturally inclined to gradually develop in a (relatively) short period of time.
Product-founder fit is a less trivial dynamic, but just as important to at least occasionally consider. You would expect most of the co-founder/CEOs you work with to bring a product vision capacity with them. As such, the product they end up developing is usually, to a degree, a derivative of their outlook and tendencies as product leaders. Some product categories require diligence, precision and a level of meticulousness to them which doesn’t necessarily correlate with certain founders’ tendencies. Other product categories require an emphasis on a grander vision and some level of disruption, which is better suited for a different type of a CEO. As with most things, it really depends on the CEO persona.
There are several other ‘fits’ we can elaborate on, but the bottom line is that these dynamics allow us to have a more nuanced discussion when trying to understand many underlying (and critical) elements which should impact our decision-making processes.