This presentation was used for my talk at HowToWeb 2014 in Bucharest Romania and is the updated presentation to my blog post on the subject - http://thedrawingboard.me/2013/05/03/the-product-market-fit-cycle/

1. The Product Market Fit
Cycle
Carlos Eduardo Espinal (@cee)
Partner | @seedcamp

2. Since 2007
Over 140+ Companies
Focusing on Product Market
Fit
Pre-Seed & Seed Investments

3. It’s human nature to focus on what
you are good at not on what you suck
at
and…
Most Founders/Hackers love building
product
Therefore…

4. Founders Sometimes
· Get stuck optimizing a product’s features
· Have metrics, but not deriving the right
conclusions
· Failing to hit Product Market Fit before cash
runs out

5. Let’s pause that thought & define
some concepts

6. What is Product / Market Fit?
Poor conversions, no word of mouth, slow usage
growth, long sales cycle, and high churn
|
“Customers are buying the product as fast as you
can make it, or usage is growing as fast as you
can add more servers.” - Marc. A.

7. Why do you want to create a company?
· What is your vision?
· What are your values?
· What company culture do you want to instill?

8. Other than for making money…
· On what basis will you make decisions?
· What will you be looking for in people you hire?
· what will motivate you through the hard times?

10. This is NOT just a cheesy
catchphrase!

11. Your customer

12. Identifying a Minimum Viable Segment
· Allows for better differentiation with out-group
competing products
· Allows for easier referrals in-group
· Allows for efficient capital use in reaching your
market

13. Case Study: The Amazon Kindle

14. Your Positioning
“how you differentiate yourself in the
mind of your prospect.”

15. In a highly competed market >
Differentiate!
Position well, or Re-position your
competitors

16. Case Study: Commuting - Airline vs.
Car
Southwest Airlines
The short-haul, no frills, and low-priced
airline

17. Case Study: Cars - Quality vs.
Experience
Mercedes Benz vs. BMW
Engineered like no other car in the
world vs. The Ultimate driving
machine

18. Your Product
An MVP is more than just about the
code

19. What Job does your
product do for your
customer?

20. How does your product reflect your values and
your customer’s needs?
· Quality
· Packaging
· Messaging
· Customer Service

21. Product Focus Case Study:
Customer Service
Zappos

22. Your Go-to-Market
Strategy

23. A Go-2-Market Strategy Includes
· Pricing Strategies
· Sales Strategies & Partnerships
· Distribution Channels
· Communication Channels

24. Your Analytics & KPIs

26. Picking up where we left
off…
What can sometimes be the problem?

27. It’s easy to miss one/all of these:
1. Identifying a Minimum Viable Segment
2. Defining a clear positioning strategy + MVP that
represents it
3. Testing of a complimentary go 2 market
strategy
4. Tracking the right metrics to refine your value
proposition

28. Define a “target” (MVS)
Create a “bullet” to hit it
(positioning + product + go-2-market strategy)

29. The Product Market Fit
Cycle

31. If (startup.status == product
market fit) then startup.scale;
|
Else (inefficient_scaling);

32. Summary
- Define your company’s core values &
hire accordingly
- Identify a MVS + Define your ‘Bullet’ -
Positioning, MVP, & Go2Market

33. Summary
- Test & Measure w/ Metrics
- Iterate on MVS or one variable within
your Bullet
- Rinse & Repeat or Pivot until cash
runs out

34. Thank you
@cee
http://www.seedcamp.com