If you are on the journey toward product-market fit, you know it’s not easy. Part of it is because it’s really hard. Every new product has its own fit to find. But it gets easier when you understand what this journey should look like, and how to navigate it all the way through. Here is a quick guide to help you understand what to expect.

When I studied coaching, one of the coaches who taught us was a guy named Ronnie. He was an extremely experienced coach with many stories about his own personal journey to become a great coach which he shared with us very openly. One day, he wanted to explain to us what was the secret of coaching, and that’s what he said:

“I love cars. I love driving them, I love owning them, but I’m not a mechanic. When I open my car’s hood, I see many things, but I have no idea what they are, how they should work, and of course, I’m unable to identify what went wrong in case of a problem. But when a mechanic opens my car’s hood, they understand what they see in ways that I cannot. They don’t just look at the car parts, they know what they are and how they should be working together. Of course, if there is a problem, they will be much better at identifying where it comes from and fixing it accordingly. That’s why when I have a problem with my car I take it to a mechanic and don’t try to fix it myself.

Now, while I don’t know how cars work, there is something else that I know very well: I know how people work. And that’s what I’m going to teach you — the operating system of people — so that when you talk to your coachees and see “under the hood” of their minds, you know how to interpret what you see there, and therefore you know how to help them.”

This simple metaphor resonated very well with me. It is indeed much easier to know what to do when you understand what you see. When you know how things should work, you can much more easily identify what doesn’t work as expected. But if you don’t know how it should work, anything you see may or may not be working properly. You simply don’t know, and therefore don’t know what needs to be done, if at all.

One of the hardest challenges of any product and any startup is of course reaching product-market fit. It takes a long time, there is no guarantee that you will succeed even if you’ve done it before (although that definitely helps), and you often find yourself wondering if you are doing the right thing. That’s why it’s the first topic I teach at the CPO Bootcamp.

The good news is that product-market fit, like people, and cars, have their own “operating system”. When you understand what it looks like and how things should work together, it’s much easier to navigate this journey with confidence. You will be able to identify where you are at each given moment, what you should have accomplished by now, and what doesn’t work as expected.

So here it is — product-market fit under the hood.

The journey to product-market fit is generally made of 5 stages:

You need first to have a working product in the market so that you can start learning for real. Then, when you are already operating within the market, you need to identify your ideal customer profile. Once you do, your goal needs to be to succeed end to end with a small number of them, making them happy, paying customers. At this point, the next step is to systemize it: define the playbook that consistently converts leads of that specific profile into happy, paying customers. Now that you know that you can consistently succeed with these leads, it’s time to scale and bring many more of them into your funnel.

When you look at it from the birdseye as I just did, it seems pretty clear and obvious. But oftentimes when you are in the weeds, it’s not always clear which stage you are currently in. Part of it is because these stages are not separated by clear lines. They are an evolution of one another, and the transition between them could take time. So you might be diagnosing yourself as “almost done with stage 2 but already starting to work on stage 3”. It makes perfect sense, and you should feel comfortable with these blurry lines. If you need a definitive answer, simply decide which stage are you closer to.

Next, we’ll get into the details of each stage. In today’s article we will discuss the first two stages, and next week we will get into the remaining three.

There is a lot of good advice on how to get from an idea to a working product. You should absolutely follow it — interview potential customers, understand the market and the competition, decide on an MVP, etc. But honestly, the most important thing in this phase is to meet the market as soon as possible. It’s only when the rubber meets the road that you can start your real learning. And the product, as well as your focus and understanding of the market, are going to change so many times until you reach product-market fit that it almost doesn’t matter what you have in step one of the way.

Don’t get me wrong, it’s not that you should do whatever just for the sake of doing it, but you should know that it’s not going to be perfect, or even good. The first deals that you are going to secure are likely to be much more on relationship and vision than on a working product (or you shape the product together with your design partners as you go, in a later stage). If you are going for product-led growth, take into account that initially you wouldn’t be able to convert anyone. And that’s perfectly fine — at this point, the learning is more important than the results.

Once you start meeting customers, some work with you more easily than others. If you are doing actual sales work, you will see deals that progress better than others. People who are more willing to chat with you whenever you want than others. Customers you have more fun working with because it feels like you are on the same page.

These are great and important signals. This is the market’s way of telling you that there is a real need out there, for those specific people. So on top of being happy that “things work well”, what you need to do here is stop and understand what all of these customers have in common. Actually, they don’t even need to be paying customers yet, if you are in a B2B company with longer sale cycles, a POC that seems to be going the right way is often a great signal to rely on (at least for now).

Find what’s common between these customers you enjoy working with, and put a hypothesis together regarding what distinguishes them from the rest who are not progressing as quickly. Note: if you are in B2C or working in a product-led growth model, you might not have the human signals but rather data signals (you will see some people moving faster than others and have higher adoption or engagement with your product). Now is the time, if you haven’t done so already, to reach out to them and understand their world. It shouldn’t be a sales call. You can ask them for help in improving your product (people love to help), and seek honest feedback.

When you talk to them, make sure you talk about them — about their world, and how they make decisions, rather than just about how they view your product so far. Understand their motivations, what are they trying to achieve with your product, and what made them try it. It shouldn’t be a discussion about product features, although that’s usually the easiest default both for you and for them. So you should prepare your interview questions in advance so that you don’t deteriorate to feature discussion.

Once you have deep knowledge of your most promising customers, create a hypothetical profile of what makes someone (company and persona) a successful customer of your product. Note that the question is not what would make them a happy user (that’s part of it of course), but rather what makes them ideal for becoming a happy, paying customer (eventually).

When you have a profile, test it for a while to see if you got it right. I remember the joy I had when I first created the ICP (Ideal Customer Profile) of my consulting customers, and the next person who called fitted that profile exactly. I felt I was onto something.

Note that your profile should be as detailed as possible. Don’t just leave it at the level that is easily targeted by your marketing team, because not all companies with 100–500 employees are alike. What is it about these companies that make them ideal for you? Perhaps it’s how long they have been around, or how innovative their CEO is.

If you are in B2B, you should profile the company as well as the specific personas within it that are involved in the purchase decision (typically including your user persona but definitely not limited to it). For example, you might find out that your product sells better to companies where the CISO comes from smaller, innovative companies and wants to bring change to the bigger ones as well (if you are in the cybersecurity space).

Once you have a profile, check to see if you believe it is common enough for you to be able to succeed with the product. In other words, if that’s your market — how big is it? Is it worth the effort to succeed in that market?

If the answer is yes, you can move on to the next stage.

What is it? Glad that you asked! We’ll talk about it next week, so stay tuned.

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