Product Strategy

There are four signs your idea has legs:

1. People pay you money: Several people start to pay for your product, ideally people you don’t have a direct connection to


2. Continued usage: People continue to use your prototype product, even if it’s hacky


3. Strong emotion: You’re hearing hatred for the incumbents (i.e. pain) or a deep and strong emotional react

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“Many investors will say that the total addressable market (TAM) size is the primary indication of ‘venture scale,’ but I disagree. You can have large TAMs that actually aren’t very good markets for startups, and smaller markets that can be expanded by the abilities of a talented startup with the right product offering.

So instead I tell founders t

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2. How much pain are you solving?

On a scale of 1 to 10, how painful is the status quo? Is it a 9-10, or is it 4-5? It’ll be hard to get people to pay a lot of money, or to switch from a good-enough product, if there isn’t a lot of pain.

1. Is my market big enough?

Do the math. What would have to be true for your business to reach $100M in revenue in one year? How many people would need to be using it (and/or paying for it), and how much should you need to make per user?

a spectrum that provides a useful guide to finding ever-increasing PMF:

• Step 1: Get one company to love your product


• Step 2: Get one company to pay (a meaningful amount of money) for your product


• Step 3 : Get more than one company to love and pay for your product


• Step 4: Start noticing a shift from push to pull, and organic growth


• Step 5: Keep grow

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No matter which path you take, you are looking for two things: pain and pull . Pain tells you there’s an opportunity to solve a problem, and that it’s important. Pull tells you that you’re actually solving the problem.

Ingredient 2: The market is underserved

Existing solutions need to be doing a subpar job of solving the problem. The founder of CRED, Kunal Shah, has a great framework for evaluating potential new solutions, called Delta-4:

1. What would a customer rate the existing solution on a scale of 1 to 10?


2. What would they rate your solution?

Your solution needs t... See more

Ingredient 1: The problem is important to people

There need to be a lot of people willing to spend a lot of money to solve the problem. Most startups fail not because the idea isn’t good but because the market for the solution is just too small. If you want to build a venture-scale business, a rule of thumb is that there needs to be a clear path to... See more