#55 — Finding B2B product-market fit (Part II)

Note: This is a follow-up to a previous note on finding B2B product-market fit through the 5 P's.§

Why it matters: Most startups die waiting for PMF. It's not a straight line; it's a multi-level game you need to win.§

Level 1: Find a Real Problem

• Solve your own itch: Tackle a significant problem you and your co-founder have personally faced and tried to solve.
• Pick your people: Target users you genuinely want to serve long-term.
• Be different: For known problems, your solution needs to be 10x better or cheaper. Beware of trends; differentiate, especially with conservative buyers.

Level 2: Validate It's Not Just You

• Talk to users: Confirm others feel the pain point. Warm intros beat cold outreach.
• Be sharp & fast: Keep requests concise (2-3 sentences). Respond to interest within seconds.
• Listen deeply: Ask open-ended questions (read "The Mom Test"). Look for clunky, existing workarounds – that's often where opportunity lies.
• Keep it quick: This phase is weeks, not months. If you stall, pivot back to Level 1.

Level 3: Validate Your MVP with Real Users

• Ship something: Get a basic version out ASAP. Actions speak louder than words.
• Engage early users: Start with people you talked to in Level 2. Make it easy for them to try.
• Diagnose drop-offs: If they don't engage, why? Unclear value? Lack credibility (fix your messy website)? Skepticism? Access issues? Risk worries?

Level 4: Validate Retention – Keep Them Coming Back

• Track usage: Are users returning at the expected frequency? Set up analytics.
• Talk & watch: Get qualitative feedback via calls and session replays.
• Close the loop: Gather feedback -> build/fix -> notify user -> repeat. This builds loyalty and word-of-mouth.
• Activation issues?: If users sign up but don't get value, manually onboard them (do things that don't scale) or radically simplify onboarding.

Level 5: Land 5 Reference Customers

• Define your Ideal Customer Profile (ICP): Get super specific about needs, haves, and attributes. Score potential users against it.
• Talk money: Be upfront about needing to charge. Optimize pricing for learning, not immediate revenue. Start internally, maybe go public later.
• Founder sells: You, the founder, must handle early sales. Don't outsource this critical learning phase.
• Aim for happy & paying: A reference customer pays list price, uses the product as intended, and would recommend you. Get five.

Key Inputs for the Game

• A Co-founder: PMF is a co-op game. You need a partner for resilience. At least one must embrace sales, both must talk to users. Treat each other as true partners.
• A Simple, Credible Website: Design matters for first impressions. Focus on clear, simple copy first.
• "Build Fast" Mentality: Optimize for speed and learning. Use tech you know. Ship early and iterate, even if it's clunky.
• Open & Responsive Attitude: No barriers between builders and users. Respond incredibly fast. Make giving feedback easy.
• Simple Sales Motion: Focus on one deal at a time. Use your network. Qualify leads (Budget, Authority, Need, Timeline).
• Risk-Free Pricing: Make it easy for early customers to say yes. Offer monthly options, free trials, or break clauses.

Pivot Smart

• It's normal: Most successful startups pivot; PostHog did 6 times.
• Know when: Pivot if you lose motivation, get stuck on a level, or become a solution looking for a problem. Be decisive.

The bottom line: Finding PMF is a grind filled with doubt. Talk to users relentlessly, build fast, iterate based on real feedback, and don't fear pivoting. Crucially, make time weekly to step back, reflect on learnings, and choose your next move wisely.§