How to Find Minimum Viable Product-Market Fit (PMF)

1. What is considered as PMF?

• Product: A product that solves a real problem
• Market: Being in a market that is adequate to support the entry, growth, and scalability of your product
• Customer: An audience who want to fix that problem and willing to pay for your product

1. people are using and paying for your products
2. people love using it (and want their friends to use it)
3. people rave about your products on social
4. your product sells itself without you trying to sell it
5. people keep coming back to your app
6. you’re gaining traction (e.g. app download, usage, retention)
7. you’re growing user base, MRR, revenue, profits — rapidly
8. you’re hiring more people to support the growing customer base

2. The path to product/market fit

• The Market: You research the industry to find out the market demand. 📕 Here’s my lean research on consumer tech opportunities.
• The Customer: You research your target customers and understand their needs. 🔮 Here’s my user-driven framework.
• The Problem: You talk to users, run user research to see if your target customer is facing valid problems you want to solve. 🤓 Here’s a list of curated questions to ask your potential users.
• The Solution: You create a prototype or minimum viable product (MVP), test with users to find out if it solves the problem, and validate/disprove your MVP 🚀 My step-by-step MVP breakdown
• Go-to-Market (GTM): You launch your product, acquire users, test different marketing channels to find the most effective ones.

3. Start from a Minimum Viable Market

Product/Market Fit starts from the Market — not the Product. 

• The market is where you will find customers who will adopt the product — where problems and opportunities arise. I internalized this concept in my latest work.
• If you search for a market, you will find a problem where your product (or solution) can exist. But if you find a product/solution to fit a problem or market that doesn’t even exist — you will create something with no market needs.
• If your technology or app doesn’t solve a problem in a market — your product doesn’t exist. 
• And if you create a product in a market that can’t find enough paying customers — your business doesn’t exist.

Stake out the smallest market you can imagine. The smallest market that can sustain you, the smallest market you can adequately serve.

When you have your eyes firmly focused on the minimum viable audience, you will double down on all the changes you seek to make.

• Find a problem worth solving facing an adequate amount of people. In other words, the smallest market size that can sustain you.
• Look into a specific type of audience or unique set of users. 
• Build a persona for this group of people. What are their needs? What goals do they want to accomplish? 
• Build a solution to solve a primary pain point. Then, expand the product by solving more pain points.

4. Create a Minimum Viable Product (MVP)

• A product with just enough features to solve the primary pain point facing your minimum viable market. 
• Allows you to gain traction (Beta users, pre-order, download, or pay).
• Helps users accomplish their goals.
• Deliver values to users.

• Brainstorm a list of possible solutions to the problem you want to solve.
• Define value proposition. How do you differentiate?
• Identify feature set and key functionality.
• Map out the user journey — the steps involved in interacting with your app.
• Use the right tools and technology to build the MVP features. Remember, users don’t care about your tech; they only care about if you can fix their problems.
• For inspiration, you can go through all my MVP guides: sneaker app, meal kit app, virtual event app, SaaS tracker, food delivery, content app

5. Measure Minimum PMF

• Monthly Recurring Revenue (MRR). Do they pay for it? Are there any signs of increasing revenue? Are you Ramen profitable? Use Stripe to monitor billing analytics.
• Net Promoter Score (NPS). Do they recommend your product to their friends? To measure NPS: take the % of Promoters (those who rated 9, 10) minus % of Detractors (those who rated 0, 1, 2, 3, 4, 5, 6). Here’s an NPS survey template by Typeform.
• “Very Disappointed” test. Coined by Sean Ellis, who led early growth at Dropbox. He suggests asking users — “how would you feel if you could no longer use the product?” The higher the % of “very disappointed”, the better. See how Superhuman find product/market fit.
• Retention. Are your daily, weekly, monthly active users increasing? Use Amplitude, Heap, Mixpanel to measure retention.

6. From Minimum PMF to true PMF

I often talk to founders who believe they’ve found product/market fit when they haven’t. This is a huge problem because they start hiring people, increasing burn, and optimizing their product before they’ve actually discovered what needs to be built.

• Minimum PMF: Enter a minimum viable market, solve a pain point, make rents or become Ramen profitable. Looks a lot more like a business than a startup since it involves serving customers manually and doing things that don’t scale. E.g. Airbnb started off by renting air mattresses in their apartment 💡 using this MVP, skip to Point (1)
• Growth PMF: Discover and move towards solving an extremely painful problem that has big enough demand. The solution must be better, faster & cheaper. Leverage go-to-market strategies to grow the user base and sales. 
• Scalability PMF: Expand the market size, countries, widen use cases across customer segments. E.g. Airbnb became a $31 billion company and went public in 2020.

Discover Market Opportunities: