is a perennial Question for early-stage startups: how do you find product-to-market (PMF) fit? What do you do to ensure that your idea takes shape in such a way that it meets some kind of demand in your target market? How do you get your idea to resonate with the world?
At TechCrunch’s Early Stage event a few weeks ago in Boston, David Thakera general partner at Greylock, advised startups to keep it simple: focus, adjust and adapt.
The definition of PMF is mostly subjective, but Thacker is looking for something more tangible.
“It doesn’t mean you’ve released a product and scaled it to millions of customers and users,” he said. “What I’m looking for is some semblance of what you’ve built is resonating with a set of customers.”
This metric can vary by stage, but Series A and beyond is when it becomes critical for a business to have PMF. At that stage, Thacker said, investors want to see a moderate scale of consumer use, and when a company is looking for a Series B round, it’s best to start thinking about the total addressable market size (TAM) and where it’s going. Find your product in relation to it.
“You may have found that the product market fits an audience segment, but how big is that audience? How lucrative will that be when it expands? Those are the things we started to think about,” he said, urging founders to determine their company’s PMF with a metric that aligns with company values.
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