Categories
design innovation startups

Find Product Market Fit Fast

Product Market Fit is one of the hardest things for an early-stage startup to achieve and it’s a critical step for companies looking to scale and be successful.

Product/market fit means being in a good market with a product that can satisfy that market

Marc Andreesen – Andreessen Horowitz

So the first thing you need to do is to understand your target market. Are you building a product for the automotive market, the food & beverage market, the software or technology market or something else? To find product-market fit, you really need to narrow your market and niche down. Don’t try to make your product solve the problems of multiple markets early on. Identify a core initial target market.

Once you know your target market, make sure you really understand and research it. You can’t possibly expect to satisfy your customers let alone a target market unless you really understand their problems.

In researching a market and the problems within that market many entrepreneurs will start to identify problems. Once you have a couple conversations you’ll see patterns emerge in terms of problems that people are experiencing.

In the early stages of a startup it’s typical to build early solutions to those problems. And when these solutions solve those specific problems you have product-problem fit. You’ve identified a problem and you’ve provided a solution… many entrepreneurs think that they are set and they stop there but finding product-market fit is more complex. You need to ensure that your product doesn’t just solve a specific problem, but rather it solves a problem that is repeatable and consistent across a large market segment.

To do this you need two core things:

  • First: You need a good cross-section of customers across your market. Not just your friends’ circle, but knowing that a good portion of any customers in your target market have a similar problem you can address.
  • Secondly: Your product has to be sticky enough that people are upset if you were to take the product away.

Finding and solving a problem is a great start but to really find product market fit you need to make sure that the problem you’re solving is widespread and impacts a large enough market in a scalable way and that the solution doesn’t feel like a NICE-to-Have but rather a NEED- To-Have.

It’s better to make a few users love you than have a lot that are ambivalent.

Paul Graham – YCombinator

You need people to care and the best way to find out if they do is to ask them. Ask your users how they’d feel if they could no longer use your product. The group that answers ‘very disappointed’ will unlock the product/market fit.

Sean Ellis, who ran early early growth in the early days of Dropbox, LogMeIn, and Eventbrite and adviced that if 40% of your customers would be “Very Disappointed” then you’ve found product market fit.

When thinking about product market fit, it’s worth also considering founder-market fit. Some founders have deep experience with a particular market. Maybe they spent a decade at a large company within the target market so they know the right people and they know the problems that are un-solved. Sometimes having a good founder-market fit can be a huge advantage and investors will consider how well a founder is aligned to a market. On the flip-side sometimes founder-market fit can be road-block. Consider how sometimes only an outsider to a market can realize just how broken a market is. If Uber had deep market experience in the Taxi market they may never have build as disruptive a company.

Finding product-market fit is both one of the most misunderstood and difficult steps for any growing startup. Keeping yourself focused on the customer and how that relates to the larger market will keep your company on track.

Categories
innovation

Why is Zoom so popular?

Over the last three weeks zoom conference calls have exploded, but why is Zoom so popular?

Video conferencing isn’t new, in-fact Skype, WebEx, Facetime, and Hangouts have been around for years but there are a few things that set Zoom apart.

The first and arguably the most important is the quality of the product experience, in particular audio/video. If you can’t get the quality and performance to work well, then the other features don’t really matter.

In testing Zoom calls vs Skype and Hangouts… Zoom is a clear winner. The fidelity of the video, speed of connection and end-user control of what you’re viewing is far better than the others.

Google hangout offers a cleaner user experience, in that everything stays in the browser. Skype wins on the social front, offering many features to chat/connect, but for large calls, there’s just no comparison. Try to get 10-20 people on a call and nothing really comes close.

Why is this? After all… Skype was the pioneer when it was introduced in 2003 and has had almost a decade head start. The Skype experience took advantage of the high-speed Internet adoption and helped Skype dominate the field initially. It grew quickly and Skype was acquired by eBay three years after launching. Three years after that it was sold to a Private Equity firm, and two years after that was sold again to Microsoft in 2011. That’s a lot of ownership transitions.

At the time Microsoft had its own video audio product called, Microsoft Lync and Office Communicator. This caused a bunch of confusion but no problem… Microsoft said, let’s rename Lync to be called “Skype for Business.” This compounded the problem since the product was incompatible with Skype. Since then, Skype for Business has been morphed into Microsoft Teams and that product is also mostly incompatible with classic Skype.

While Skype had the early mover advantage they lost their advantage because they confused and split the market. They pushed businesses toward one product and personal use toward another.

Zoom got it right – people want to video conference for both personal reasons and for work reasons making it easy to blur the line between the two.

The other thing that Zoom got right was the underpinning technology. While Skype was slow to innovate Zoom took advantage of how the Internet was changing. When Skype was introduced Internet connectivity was slow and a common approach to solving 1 to 1 communication was using peer-to-peer connectivity. The person talks to the server and the server sets up the connection between the two computers. While this makes sense, it has some problems… If one person has a bad connection the entire call gets dropped and as you add more people the number of connections grows very quickly.

With 10 people you need to manage 45 connections. This is called Metcalf’s law. Instead, Zoom uses a central server like a telephone switchboard and those 10 users, only need 10 connections to the central switchboard.

This allows the conversation to scale very well and if someone’s connection is poor the overall conference doesn’t drop. It also allows different levels of quality to get downloaded to people based on their connection speed and their device keeping the experience working well.

In addition to the quality of the call and performance with many people, Zoom is introducing a lot of under-the-hood features that are making it easy for teachers, tutors, and businesses

  • Recurring meetings – make it easy to schedule meetings and it keeps people coming back to the product.
  • Remote assistance and control allows people to use Zoom to do customer or technical support
  • Break off rooms allow you to take a large meeting and break it off into smaller working groups
  • Whiteboarding allows people to collaborate visually
  • And much more…

While there’s a lot of luck in building a successful business, Zoom is doing well because it’s doing a lot of things better than the competition.

Zoom isn’t perfect, the UI could use a clean-up pass.

  • The button to end a call, shouldn’t be where you resize the window.
  • The toolbars are inconsistent and tend to bounce around between three or four different configurations
  • Some interactions require right-clicking to pin video or unpin in a rather unintuitive way.
  • Sometimes the screen resizes in response to a remote person sharing, even if I’ve configured it as desired.

Zoom will continue to grow steadily as the technical challenges and complexity of what Zoom has done is a huge barrier. I’m sure the video space will evolve but 2020 has changed people’s expectations of video conferencing forever.