If you’re looking to start your own company, it’s important to spend your time wisely – because time is money when it comes to running a business.
For starters, if you’re focused on building or leading the direction of your product, you can conduct a copious amount of market research to understand the lay of the land. However, without speaking to users, you will likely fall into the trap that many startups face: developing a product that doesn’t fulfill an actual need.
According to research conducted by CBInsights, researchers observed 400 failed consumer hardware startups and found that the top 3 reasons of failure were:
- Lack of consumer demand (aka not finding product market fit)
- High burn rate (most likely caused from not finding product market fit or paying users)
- Lack of interest after initial crowdfund (also an indicator of no product market fit)
To ensure your startup doesn’t fall into the trap of failing to find a product market fit, it’s important to de-risk your idea by testing your assumptions. Here are some steps that you can take.
- Find out where your users hang out.
Lurk around and listen (see if users are speaking about your problem. If not, bring up the problem and see how they react)
- Determine who your competitors are and what they’re doing.
What type of users are they targeting and what messaging are they using? (I found a simple google search or searching on Crunchbase based on industry is a great place to start)
- Speak to potential users about your idea.
Get feedback on your idea and ask users to explain their current workflow to see if your product can solve their problems. Resources that can help users better understand your idea include wireframes, prototypes, or hand drawn images. If you’re worried about others stealing your idea, think about how difficult it is to execute your idea. Others will be facing the same difficulty.
- The best places I found to find potential users are LinkedIn, Reddit, Discord, Twitter, Facebook, or any virtual forum.
- Keep track of all your interactions. I currently use Airtable, but there are other options such as Microsoft Excel, Google Sheet, Notion, and Trello.
On your journey to finding product market fit, you may need to pivot the way you engage with users. This will increase your conversion and improve your response rate when cold-emailing or messaging potential customers. Over time you will start to spot users that fit a specific characteristic and share a set of similar issues and pain points. Once you find a group that is receptive to your idea, dig deeper. For the ones that are extremely avid, invite them to your alpha or flag them.
The process of finding product market fit is like digging for gold. Once you hit gold, or your first paying customer, keep digging to test your assumptions through customer validation to ensure success.
Best of luck!