product market fit cycle master class public

8/18/2019 product market fit cycle master class public

1/19

THE PRODUCT MARKET FIT CYCLECarlos Eduardo Espinal @cee

Copyright - Attribution-NonCommercial-ShareAlike 3.0 Unpor tedhttp://creativecommons.org/licenses/by-nc-sa/3.0/deed.en_US


2/19

A QUICK JARGON BUSTER...

• What is Product / Market Fit

•

What is Positioning?

• What is an MVP? and an MVS?

• What are Pirate Metrics?

•

What is a Go 2 Market Strategy?

@cee


3/19

PRODUCT MARKET FIT

• When it is not happening:

Poor conversions, no word of mouth, slow usage growth, long sales cycle, and high

churn

• When it is happening:

“The customers are buying the product just as fast as you can make it — or usage is growing just as fast as you can add more servers.” - Marc Andreessen

@cee


4/19

POSITIONING• What is Positioning? - It is “how you

differentiate yourself in the mind of yourprospect.”

• What is RePositioning? - It is “how youadjust perceptions about you and/or about your competitors.”

• ..And... It’s not just about a ‘positioning

statement’

@cee


5/19

POSITIONING

• Avis ‘We Try Harder’

• Positioned around customer service & experience

vs. car count or availability which Hertz led

• Re-Positioned the leader as not caring about you

• Success = In 1 year, Avis went from -$3.2 million to +$1.2 million for the first time in 13 years.

@cee


6/19

MVP & THE LEAN STARTUP

• Build a ‘good enough’ product that fits the minimum criteria to test out your

hypothesis

• Measure interactions with the product

• Learn from the results and generatenew ideas

@cee


7/19

MINIMUM VIABLE SEGMENT (MVS*)

• Building an MVP for a small segment(vs. the whole market):

• Allows for better differentiation without-group competing products

• Allows for easier referrals in-group

•

Allows for efficient capital use inreaching your market

* Defined by Michael J. Skok (Northbridge Ventures) @cee


8/19

PIRATE METRICS* - AARRR

*As defined by Dave McClure

@cee


9/19

GO 2 MARKET

• Includes key partnerships and keydistribution channels to reach your MVS

• Includes pricing strategies, salesstrategies, and marketing methods(internet marketing, direct marketing,PR, etc)

• Note: Make sure to include cost

‘assumptions’

@cee


10/19

RESUMING THE BROADCAST...

• What has been going wrong?

• What is the solution?

@cee


11/19

HACKERS ARE REALLY GOOD AT

BUILDING

• It is human nature to focus on what youare good at not on what you suck at

and...

• Most Founders are ‘hackers’ and lovebuilding

so....

@cee


12/19

FOUNDERS CAN SOMETIMES:

• Get stuck at the “MVP stage”

• Build and Measure quickly but notnecessarily be “Learning”

• Not find Product Market Fit fast enough(before the money runs out)

@cee


13/19

THE DIAGNOSIS

• The identification of a specific Minimum Viable Segment

• The definition of a clear positioning strategy that shapes their MVP

• The testing of a complimentary go 2 market strategy

@cee


14/19

DEFINE “THE TARGET”

Minimum Viable Segment

You cannot be

everything to everybody

so pick somethingfor someone

@cee


15/19

DEFINE “THE BULLET”

•

The Positioning Strategy = The Shell

• The MVP = The Projectile

• The Go 2 Market Strategy = The Powder

@cee


16/19

@cee


17/19

SCALING PRODUCT MARKET FIT

• Find Product Market Fit THEN Scale

• Otherwise = Inefficient Scaling

• Shouldn’t optimize around growth(growth hacking) until you have foundproduct/market fit

Sean Ellis’s Growth Stage Pyramid

@cee


18/19

THE PRODUCT MARKET FIT CYCLE

SUMMARY

• Identify a MVS

• Design your Company’s ‘Bullet’ -Positioning, MVP, & Go2Market

• Test & Measure w/ Pirate Metrics

• Iterate on MVS or one variable withinBullet

• Rinse & Repeat or Pivot

@cee


19/19

THE SEEDCAMP LEARNING PROGRAM

• New Companies go through each part

of the cycle with mentors starting now& cover the basics of cycle in first week

• Our Program is designed around theProduct Market Fit Cycle

•

Annual Program focuses on each aspectof the cycle but “in depth”

@cee

Documents

product market fit cycle master class public