Thread by @lennysan

How do you know if you have that fabled ✨Product/Market Fit✨?

I've collected the top 10 best descriptions of PMF I've come across in the thread below, sorted by most to least concrete.

If you have any others you've found useful, particularly pre-product, please share below 👇

1a/ @onecaseman: "Do a cohort analysis. Look at a group of people that tried your product in a period of time (e.g. during one month). Then look at how many of those people continue to use your product for a while (e.g. 12 months later)...

1b/ ... You will have a fairly deep drop-off on the first month, that’s OK. What you want to know is, does it flatten somewhere? If so, that means that there customers who are finding value in your product, which means you have PMF with these customers."

2/ @bbalfour: "Create a retention curve by plotting the percent of users still active over time (for each cohort of users). If it flattens off at some point, you have probably found product/market fit for some market or audience."
brianbalfour.com/essays/product…

3/ @SeanEllis / @rahulvohra: "Survey your users and ask them 'How would you feel if you could no longer use the product?' and measure the percent who answer 'very disappointed.' If that percentage is over 40%, you have PMF."
firstround.com/review/how-sup…

4/ @arachleff: "For consumer apps, you have PMF when you start to experience exponential organic growth, driven by WOM. For enterprise, look at the contribution margin of a sales team divided by the total cost to field the team. If less than 1 that's PMF."
podcasts.apple.com/us/podcast/and…

5/ @dougleone: "At the end of your free trial, pull the trial. If the customer doesn’t scream, you don’t have PMF. If they aren’t going to buy it at the end of the 30 days, they aren’t desperate, and if they aren’t desperate, you don’t have PMF."
greatness.floodgate.com/episodes/andy-…

6/ @dunkhippo33: "You have found product/market fit when you can repeatably acquire customers for a lower cost than what they are worth to you."

https://twitter.com/dunkhippo33/status/1153779854614990848

7/ @sgblank: "Are people grabbing the product out of your hands saying I want it, or I'm using it, or I'm buying it, or I’m downloading it, or I'm giving you my email address."

8a/ @pmarca: "You can always feel product/market fit when it's happening. The customers are buying the product just as fast as you can make it -- or usage is growing just as fast as you can add more servers. Money from customers is piling up in your company checking account...

8b/ ...You're hiring sales and customer support staff as fast as you can. Reporters are calling because they've heard about your hot new thing and they want to talk to you about it. You start getting entrepreneur of the year awards from HBS."
pmarchive.com/guide_to_start…

9/ @sgblank: "The real metric for both consumer apps and enterprise is — do someone’s pupils dilate when they use your stuff? Whether you’re handing them a demo or if you drew something on the whiteboard, do they say, 'Where have you been all of my life?'"
podcasts.apple.com/us/podcast/ste…

10/ @eladgil: "If your product is broken and people are still using it, that’s a clear sign you have PMF. When Twitter was constantly going down in the fail whale days, and no one moved off of Twitter. That was a sign of raw market adoption."

11/ A couple more valuable quotes about the whole concept of PMF...

12a/ @bhorowitz: "PMF isn’t a one-time, discrete point in time that announces itself with trumpet fanfares. Competitors arrive, markets segment and evolve, and stuff happens—..."

12b/ ...all of which often make it hard to know you’re headed in the right direction before jamming on the accelerator."
blog.pmarca.com/2010/03/20/the…

13a/ @ev: "Though the difference between no product/market fit and some product/market fit is night and day, having “fit” is not exactly a binary thing. It’s multi-dimensional. You can have strong fit with a segment of your market and weaker fit with another...

13b/ ...You can have strong fit for one particular use case and no fit for another. The more superior your product is for more jobs-to-be-done for more people, the stronger your 'fit.'"
evhead.com/try-more-thing…

14/ One interesting takeaway from this research is that there are very few learnings about what it feels like to have PMF *before* you have a product. If you've been through this or have a lesson to share, please do!

Good. Catch. 😬