Makes me think of something I say occasionally... you need a problem so compelling that customers will pay for a buggy, incomplete solution, because a buggy, incomplete solution is what you're building.
It's the dream of every engineer to get to make something that doesn't suck, right? But the 80/20 rule applies. Getting through that last 20% that is suboptimal is 80% of the work. Every hour you spend polishing your way to perfection is an hour you don't spend adding new features or creating new products. Every bug fix is paid for with opportunity cost - at a very high compound interest rate, if you're in a startup.
I've come to the conclusion that if your code doesn't kinda suck, you're doing something wrong. You're wasting effort. Actually, I came to a much harsher conclusion than that - I've concluded that all software sucks. That all software hovers near the line between "barely works" and "doesn't work". Why? Because by the time you get to feature-complete, if it still works, it's so riddled with compromise and bad decisions that you never want to look at that code again. You want to start something fresh and new, and THIS time, you won't make all those stupid mistakes! This time, it won't suck!
This kind of starving crowd is rare and you should expecting it to be rare. That's why people are willing to pay you millions of dollars if you find one.
If you find a truly hot market, it can be worth billions and most any idiot can make a lot of money in a hot market. If you are good, all the better.
But remember, it's rare and hard to find. Assume that 99.5% of all businesses aren't in that kind of market situation.
It's a charming ideal that I think is vanishingly rare in real life. I also can't see how the hair on fire thing fits with any of the top startups and ex startups I know. In fact I dare say the rapidly rising user count is a separate story from the hair on fire story. The hair on fire tends to be a specialty business problem and still, against all reason, tends to require a pretty rigorous sales cycle. The problems I work on, making the medical record discrete data is of this kind. The other kind is more like Google, Facebook, Uber, AirBnB and those were surprises because no one's hari was on fire. We didn;t know we wanted that stuff until we saw it and then we wanted more and more.
In summary, I guess I disagree with the whole thing
I think there are actually two aspects to the market question. First, there's the level of pain experienced by the customer, and second, there's the size of the market. Lots and lots of startups are solving "hair on fire" issues for relatively small markets - enough to generate millions in revenue, but not billions.
For a sad case in point, there's not a whole lot of research for a cure (or even a treatment) for ALS - a disease that is completely debilitating and almost always fatal. There just aren't that many patients (even though it's common enough to touch famous people like Lou Gehrig, Stephen Hawking, and Jason Becker). Meanwhile, tons of money are poured into Viagra and its competitors - not an actual lifesaving problem, but a huge market.
I know about Airbnb personally and it started with a hair on fire problem - a design conference where all the hotel rooms in the city where sold out. Brian and Joe hosted attendees in their apartment on air beds. That sounds like a hair on fire problem and a brick solution :)
Cool analogy. However don't some startups actually open up things that we didn't even know were painful?
E.g I was happy staying in hotels. I wasn't on fire looking to stay at someone's house. I'm guessing the hosts weren't on fire either having random strangers over.
Facebook, Google, Amazon. I was very happy with the alternatives. They just did somethings better. Although Facebook is kind of dead to me. Haven't opened in months.
I do like the analogy of getting overwhelmed by customers and having scaling problems.
Hey Michael! Great piece. Signs of product/market fit are often strong and unambiguous, and that needs to be emphasized.
That said, many startups get v1 wrong. Not necessarily because their MVP is too clunky, but because they fail to frame (or graap) the correct problem in the first place. Or because their solution to that problem just isn't the right one. (As you aptly put it, founders can get hung up on their solutions and take their eyes off of problems.)
I'd love to see a followup piece about where to go from there. Let's say you're a founder, and your v1 failed to achieve fit. Your v2, perhaps, failed to achieve fit. What is a creative, but rigorous way to go back to the drawing board for v3?
I've worked for some successful startups, and I've worked for some failed startups. None of them found fit right out of the gate. The difference seems to have been that the successful founders recognized it quickly and took intellectually honest steps to do something about it. The failures either avoided that reality, or floundered while trying to adjust.
So what are some effective methods for assessing and course correcting in MVP customer development and product development? We know that "getting outside the building," to use the Lean parlance, is critical. So is effective brainstorming. But what are the best techniques for doing either?
I strongly second this request. As a founder working through a v1 and currently thinking a great deal about product/market fit, it would be fantastic to hear more about this.
Thanks for writing this, one of your quotes "Founders often hold too tightly onto solutions and too loosely onto problems" really resonated.
If someone were evaluating their next opportunity to tackle, would you recommend they focus less on identifying a specific pain point (that they may know how to solve), and instead identify a large market and then search for inefficiencies (even if they have less domain expertise in it).
Obviously the intersection of the two would be better (large market with a pain point you know how to solve) but curious which you would optimize for if you had to choose.
I think solving familiar problems is a curse of the startup community. Founders go after problems that are familiar, but trivial. Product finder apps for vanishingly narrow segments. Task management. Or my favorite category, startups that are supposed to help startup founders/investors evaluate startup ideas!
My recommendation is that if you're a "technical founder" - a programmer who wants to be CTO - don't look for problems to solve. Look for business partners who already have domain expertise and a problem that they can explain succinctly (so you see the value proposition), and work with them. There's a whole world of people who can see a massive problem that could make money with a good technical solution, but they don't know how to code and don't really know anyone who can code and is willing to help them.
This (and Andreessen's article) is quite insightful of knowing when you're on the right track or not, but it's more like a "you know it when you see it" kind of advice that is not very helpful in terms of how to get there, or how to design a process that allows you to methodically identify and jump into these market opportunities. Maybe a second article could dive more into that.
I agree with your point 100% - if we could tell you how to get there we would! I think the biggest point is that many companies die because they scale expenses as if they had reached product market fit when they haven't. We are trying to give you more time to find the right problem/solution.
People tend to say the same thing about marriage. They say "when you know, you know". Not extremely helpful information. However, you can optimize for that scenario by dating as many people as you can. If you go on 3 dates a week for 6 months, thats 75 dates of worthwhile info you can use to get closer to that objective.
I'd be curious to see examples of what "hair on fire" problems looked like when they were buggy, incomplete solutions to poorly-defined problems.
For example, I know that Google was a hair-on-fire problem: everybody searched for things on the Internet and nobody found what they were looking for. But was Facebook? I started using Facebook in 2004, before they'd taken VC, and I honestly didn't see the point (and still kinda don't). Perhaps I just wasn't the target market (and still am not), but then, how do you recognize a hair-on-fire problem when you're not necessarily in the target market for it?
(Interestingly, LiveJournal solved a hair-on-fire problem for me about 2 years before Facebook came out: how to keep in touch with friends that I'd met over the Internet but lived thousands of miles away. And yet Facebook is apparently a whole lot more successful than LiveJournal.)
Facebook totally was a hair on fire problem - if you saw a cute girl on campus and you wanted to look her up - all we had was a stupid freshman "facebook" (book of faces and names) and a crapy web version of the same.
The concept of good/bad market is attractive, but I'm wondering is this is really a good model. How do you account for innovations that require a market to learn its benefits before they want it?
In the beginning, a market for a innovation looks like a terrible market. Few people wanted a PC in the early days. Vacuum cleaners were a hard sell when they were first introduced, and there are countless other examples. All of these markets required that the buyers be educated and they had to be convinced it was worth the effort to learn how to use the new thing.
It seems to be, saying "don't be in a market where it is hard to sell" is great in theory, but honestly I think every truly innovative product has to create their market to some extent.
To what extent is sustained exponential growth a sign of product market fit? And do you view it as binary?
Also what are your thoughts about the long term viability of this approach to building companies? As someone with a bit of a machine learning background I see this whole model as "greedy hill climbing" aka "gradient descent." That will work until we fill in all the micro-niches at the current macro fitness peak. Then these kinds of "lean startup" style fit-and-explode market opportunities will become depleted.
Exponential growth with retention over time is probably another definition of product market fit. I think the world is always creating new problems to fix and we aren't successfully tackling the hard ones yet (housing, healthcare, poverty, etc).
What would be your advice for a team that has clearly reached product-market fit, but the market is inherently small and their growth stalls out because they've put out most of the fires for people's heads in that space?
At that point it's tempting to diversify the product and start solving less dire problems for customers by adding new features, but that makes the product larger and might slow the team down.
That's tricky - this sounds like you might have a lifestyle business (successful product in small market). You can try profiling your customers and see if if there are other companies with the same problems that your aren't serving.
"If you handed them a brick they would still grab it and try to hit themselves on the head to put out the fire. You need to find problems so dire that users are willing try half-baked, v1, imperfect solutions."
this kind of falls into line with Reid Hoffman's famous quote:
"If you are not embarrassed by the first version of your product, you’ve launched too late."
I think these statements paint a wide brush and fail particularly for products whose main value prop is ease of use.
If your product's core value prop is UI/UX/ease of use, you cannot deliver that with a buggy half finished product. And if you cannot deliver the value you intend to provide, then you are shooting yourself in the foot, spooking users losing their trust in your ability to deliver.
Obviously each product is different, but I think specifically for this type, these methodologies should be omitted. Because the most likely case is that your customer is already solving the problem with a "brick", whether that is your competition or a home made solution that they have created. Handing them another brick will not suffice.
"If your product's core value prop is UI/UX/ease of use" then you're obviously not entering/creating a new market, nor you are attempting to find a product/market fit, are you?
It pretty much implies that you're attempting to overtake existing competitors who have found product/market fit, where people have options to fill their need but do so grudgingly because of their UX quality. Doing that can be a solid business plan, but it's very, very different from the type of new-product-discovery startups that Reif Hoffman was talking about.
If the people are paying for an existing crappy product with poor UI/UX, then that illustrates a valid need and building an easier-to-use product can greatly increase the size of that market.
However, if currently people are not eager to pay for that need, then I'd wager that simply providing UI/UX/ease of use won't change that. If their need isn't sufficient to put up with the minor bother of sucky UX (at least for 10% of most needy part of the market), then that need isn't also sufficient to put up with the much larger bother of paying you adequately.
I won't ask you how to identify these markets because I think it's fairly clear that it takes dedication, thoughtfulness, and experience.
I would like to ask if you believe there are many markets with unserved "hair on fire" customers. Are there thousands of these problems waiting to be solved? My intuition is that there are many people with hair on fire problems, but not many of those problems generalize to products that lots of people would want. What do you think?
Not sure you are still paying attention to this thread, but...
When you have a marketplace, would it require a hair is on fire problem for both supply and demand?
I work at a startup marketplace where we clearly have a good solution for a hair on fire problem at the demand side, but our supply side isn't just that interested. They sign up, but their engagement is very inconsistent to say the least.
What problem does your marketplace solve for suppliers? Does it get them extra revenue? Is the amount significant to them?
Do they have to do something extra/different to work through your platform (e.g. different process, different service level, pay commission to you)? Is it still worth it?
Do they use it once and then stop? If so, just ask them.
Hey Michael, is it imperative to have a problem to start a company and get to product/market fit? I am thinking of successful companies like Starbucks and P&G whose customers are definitely not in hair on fire mode. Or is this framework of getting to product market fit for tech companies only? Your thoughts?
Having taken the long and slow road (9 years now) to building a business and getting to the place where your last paragraph seems to be where I'm at -- reading was definitely an encouragement this morning. Thank you!
Hey Michael, awesome piece! When I started my first company [that made serious revenue relative to other projects], I didn't spend any money until we actually had sales. Getting to product-market fit took awhile for us, as growing the brand and reputation just took time, but now it's an awesome machine that churns well with some spurts of oil here and there.
I think you're spot on with the half-baked, v1, imperfect solution. Currently trying to do the same with a new startup (https://getbeau.com). Our v1 didn't do it for us, but we listened to the recurring feedback and just relaunched our v2 and are continuing to validate that the problem we solve for our customers is a serious (albeit first-world) problem.
Incase of enterprise tech - finding repeatable pain across set of customers is a must. Solving one enterprises "hair on fire" problem is no guarantee of similar pain existing else where.
My observation from being in enterprise mobility market for 10 years - while one customer realizes hair on fire, many others are diabetic and don't feel the pain.
Great article. Another good way we've had this explained is: if someone is in a burning building, you are the option of jumping out of the window.. There may be a 95% chance they will die, but they're in so much pain that they'll make the jump (even though they normally never would).
Do you think this is more geared for entry strategy (getting the tip of the spear in)? In an ideal world, you could find something where building a small quantum converges with solving this degree of pain.. though of course the stars do not always align that easily...
I'd like to find more resources / books (I love audio books these days) that answer some of the questions at the bottom of Marc Andreesen's original post:
- How exactly do you go about getting to product/market fit if you don't hit it right out of the gate
- How do you know when to change strategy and go after a different market or build a different product?
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I've come to the conclusion that if your code doesn't kinda suck, you're doing something wrong. You're wasting effort. Actually, I came to a much harsher conclusion than that - I've concluded that all software sucks. That all software hovers near the line between "barely works" and "doesn't work". Why? Because by the time you get to feature-complete, if it still works, it's so riddled with compromise and bad decisions that you never want to look at that code again. You want to start something fresh and new, and THIS time, you won't make all those stupid mistakes! This time, it won't suck!
It always sucks, in the end.
This kind of starving crowd is rare and you should expecting it to be rare. That's why people are willing to pay you millions of dollars if you find one.
If you find a truly hot market, it can be worth billions and most any idiot can make a lot of money in a hot market. If you are good, all the better.
But remember, it's rare and hard to find. Assume that 99.5% of all businesses aren't in that kind of market situation.
In summary, I guess I disagree with the whole thing
For a sad case in point, there's not a whole lot of research for a cure (or even a treatment) for ALS - a disease that is completely debilitating and almost always fatal. There just aren't that many patients (even though it's common enough to touch famous people like Lou Gehrig, Stephen Hawking, and Jason Becker). Meanwhile, tons of money are poured into Viagra and its competitors - not an actual lifesaving problem, but a huge market.
E.g I was happy staying in hotels. I wasn't on fire looking to stay at someone's house. I'm guessing the hosts weren't on fire either having random strangers over.
Facebook, Google, Amazon. I was very happy with the alternatives. They just did somethings better. Although Facebook is kind of dead to me. Haven't opened in months.
I do like the analogy of getting overwhelmed by customers and having scaling problems.
That said, many startups get v1 wrong. Not necessarily because their MVP is too clunky, but because they fail to frame (or graap) the correct problem in the first place. Or because their solution to that problem just isn't the right one. (As you aptly put it, founders can get hung up on their solutions and take their eyes off of problems.)
I'd love to see a followup piece about where to go from there. Let's say you're a founder, and your v1 failed to achieve fit. Your v2, perhaps, failed to achieve fit. What is a creative, but rigorous way to go back to the drawing board for v3?
I've worked for some successful startups, and I've worked for some failed startups. None of them found fit right out of the gate. The difference seems to have been that the successful founders recognized it quickly and took intellectually honest steps to do something about it. The failures either avoided that reality, or floundered while trying to adjust.
So what are some effective methods for assessing and course correcting in MVP customer development and product development? We know that "getting outside the building," to use the Lean parlance, is critical. So is effective brainstorming. But what are the best techniques for doing either?
If someone were evaluating their next opportunity to tackle, would you recommend they focus less on identifying a specific pain point (that they may know how to solve), and instead identify a large market and then search for inefficiencies (even if they have less domain expertise in it).
Obviously the intersection of the two would be better (large market with a pain point you know how to solve) but curious which you would optimize for if you had to choose.
My recommendation is that if you're a "technical founder" - a programmer who wants to be CTO - don't look for problems to solve. Look for business partners who already have domain expertise and a problem that they can explain succinctly (so you see the value proposition), and work with them. There's a whole world of people who can see a massive problem that could make money with a good technical solution, but they don't know how to code and don't really know anyone who can code and is willing to help them.
For example, I know that Google was a hair-on-fire problem: everybody searched for things on the Internet and nobody found what they were looking for. But was Facebook? I started using Facebook in 2004, before they'd taken VC, and I honestly didn't see the point (and still kinda don't). Perhaps I just wasn't the target market (and still am not), but then, how do you recognize a hair-on-fire problem when you're not necessarily in the target market for it?
(Interestingly, LiveJournal solved a hair-on-fire problem for me about 2 years before Facebook came out: how to keep in touch with friends that I'd met over the Internet but lived thousands of miles away. And yet Facebook is apparently a whole lot more successful than LiveJournal.)
In the beginning, a market for a innovation looks like a terrible market. Few people wanted a PC in the early days. Vacuum cleaners were a hard sell when they were first introduced, and there are countless other examples. All of these markets required that the buyers be educated and they had to be convinced it was worth the effort to learn how to use the new thing.
It seems to be, saying "don't be in a market where it is hard to sell" is great in theory, but honestly I think every truly innovative product has to create their market to some extent.
Also what are your thoughts about the long term viability of this approach to building companies? As someone with a bit of a machine learning background I see this whole model as "greedy hill climbing" aka "gradient descent." That will work until we fill in all the micro-niches at the current macro fitness peak. Then these kinds of "lean startup" style fit-and-explode market opportunities will become depleted.
What would be your advice for a team that has clearly reached product-market fit, but the market is inherently small and their growth stalls out because they've put out most of the fires for people's heads in that space?
At that point it's tempting to diversify the product and start solving less dire problems for customers by adding new features, but that makes the product larger and might slow the team down.
this kind of falls into line with Reid Hoffman's famous quote:
"If you are not embarrassed by the first version of your product, you’ve launched too late."
I think these statements paint a wide brush and fail particularly for products whose main value prop is ease of use.
If your product's core value prop is UI/UX/ease of use, you cannot deliver that with a buggy half finished product. And if you cannot deliver the value you intend to provide, then you are shooting yourself in the foot, spooking users losing their trust in your ability to deliver.
Obviously each product is different, but I think specifically for this type, these methodologies should be omitted. Because the most likely case is that your customer is already solving the problem with a "brick", whether that is your competition or a home made solution that they have created. Handing them another brick will not suffice.
It pretty much implies that you're attempting to overtake existing competitors who have found product/market fit, where people have options to fill their need but do so grudgingly because of their UX quality. Doing that can be a solid business plan, but it's very, very different from the type of new-product-discovery startups that Reif Hoffman was talking about.
If the people are paying for an existing crappy product with poor UI/UX, then that illustrates a valid need and building an easier-to-use product can greatly increase the size of that market.
However, if currently people are not eager to pay for that need, then I'd wager that simply providing UI/UX/ease of use won't change that. If their need isn't sufficient to put up with the minor bother of sucky UX (at least for 10% of most needy part of the market), then that need isn't also sufficient to put up with the much larger bother of paying you adequately.
I would like to ask if you believe there are many markets with unserved "hair on fire" customers. Are there thousands of these problems waiting to be solved? My intuition is that there are many people with hair on fire problems, but not many of those problems generalize to products that lots of people would want. What do you think?
When you have a marketplace, would it require a hair is on fire problem for both supply and demand?
I work at a startup marketplace where we clearly have a good solution for a hair on fire problem at the demand side, but our supply side isn't just that interested. They sign up, but their engagement is very inconsistent to say the least.
Do they have to do something extra/different to work through your platform (e.g. different process, different service level, pay commission to you)? Is it still worth it?
Do they use it once and then stop? If so, just ask them.
I think you're spot on with the half-baked, v1, imperfect solution. Currently trying to do the same with a new startup (https://getbeau.com). Our v1 didn't do it for us, but we listened to the recurring feedback and just relaunched our v2 and are continuing to validate that the problem we solve for our customers is a serious (albeit first-world) problem.
My observation from being in enterprise mobility market for 10 years - while one customer realizes hair on fire, many others are diabetic and don't feel the pain.
Do you think this is more geared for entry strategy (getting the tip of the spear in)? In an ideal world, you could find something where building a small quantum converges with solving this degree of pain.. though of course the stars do not always align that easily...
- How exactly do you go about getting to product/market fit if you don't hit it right out of the gate
- How do you know when to change strategy and go after a different market or build a different product?
Anyone have books on some of these mechanics?