What does no product-market fit mean?
No product-market fit is when a product did not meet the needs of a market, or failed to be in a good market to satisfy that market.
According to Marc Andreessen (Co-founder & General Partner of Andreessen Horowitz - aka a16z), "You can always feel when product-market fit isn't happening. The customers aren't getting value out of the product, word of mouth isn't spreading, usage isn't growing that fast, press reviews are kind of 'blah', the sales cycle takes too long, and lots of deals never close."
In ‘Why Startups Fail’, David Feinleib (2012) remarked that ‘before a company finds product-market fit, nearly everything the company does (or should do) is about the search for product-market fit’.
Moreover, David Feinleib (2012) added that ‘some startups spend too much time on building their technology without getting user or customer feedback’.
In result, they will end up offering products or solutions that the market does not want, which not only waste valuable capital, but also precious time.
Definition of product-market fit
According to Andy Rachleff (Co-founder & CEO of Wealthfront) who coined the term, he explained that by identifying a compelling value hypothesis is what he called finding product-market fit.
A value hypothesis is an attempt to articulate the key assumption that underlies why a customer is likely to use your product.
It identifies the features you need to build, the audience that is likely to care, and the business model required to entice a customer to buy your product.
Companies often go through many iterations before they find product-market fit. If you managed to address a market that really wants your product, then you will succeed.
According to Clément Vouillon (Senior Research Analyst of Point Nine Capital), product-market fit happens when the product (a set of features that have a clear value proposition) resonates with customers (which are of a certain type and have defined needs) that you know how to reach and convert (through marketing and sales).
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Last edited on 10 December 2019.