Most founders set Product/Market Fit as their first significant milestone. The problem is that getting to product/market fit typically takes two years (for most products), and 80% of products never get there.
At this rate…
Finding a good idea could take up to 10 years — not counting downtime between ideas.
Instead of aiming for Product/Market Fit, aim for Problem/Solution Fit. Problem/Solution Fit is achievable in three months across any product or customer segment. In the same 2-year period, you could fit eight Problem/Solution Fit iterations.
But does that automatically lead to an 8x improvement in your odds of success?
Let’s start by defining Problem/Solution fit.
Subscribed
What is Problem/Solution Fit?
Most products fail today, not due to technical risks but due to customer and market risks. In other words, most founders usually manage to build what they set out to build but fail to find market traction, i.e., they fail to build something customers want.
Some of the most common reasons for this are:
1. Overprioritizing technical risks
This is the classic build-first trap, where you build out a product (or MVP) before engaging customers. The danger is building too much or, worse, building the wrong product.
Building the wrong product burns precious runway, introduces sunk cost fallacy, and delays testing riskier assumptions. While every product needs to address feasibility risks, the trap here is overdoing it.
You don’t need a fully functioning product to start engaging customers.
2. Misreading customer risks
Asking customers what they want, conducting surveys, or relying on so-called “experts” leads to faux validation (and confirmation bias), which tends to stray you away from real problems worth solving and down the wrong rabbit hole.
“It is not the customer’s job to know what they want.”
- Steve Jobs
3. Addressing customer risks but not market risks
I have encountered many founders who do a reasonably good job of understanding customer needs and problems. But then fall short of validating the next riskiest assumption: Will they buy?
They confuse polite interest with validation, which leads to another rabbit hole down the build trap. Only to be rudely awakened months later when customers balk at their pricing model.
Price is one of riskiest assumptions in a business model that should be tested as early as possible.
The only way to adequately validate market risk is by moving the customer toward a sale. And no, you don’t need a working product to make a sale, either.
4. Underestimating market risks
Other founders generate sales but don’t adequately test the viability of their pricing model, only to be stuck months later in a local-maximum business model that doesn’t scale — turning them into a Zombie startup.
A working business model is the true product of a startup.
Problem/Solution Fit aims to address all these shortcomings by front-loading these risks.
When you can demonstrate
- sufficient and repeatable demand through sales
- for a product you know you can build,
- at a price point that makes your business model work,
you have Problem/Solution Fit.
Doing this requires
- mapping the market opportunity,
- deeply understanding your customers,
- designing solutions that solve problems exactly,
- validating demand for those solutions,
- before building anything.
Back to the question of 8x improvement…
The true job of a founder is to de-risk their idea systematically. In theory, a company with zero risk has infinite value. And so it follows that every business always carries risks.
You raise your odds of success by continuously eliminating your riskiest assumptions.
When practiced rigorously, the Problem/Solution Fit process forces the first tangible go or no/go decision on an idea. While we strive to achieve Problem/Solution Fit within the first three months, not achieving it and knowing why isn’t failure but a step closer to finding a business model that will work.
Eliminating your riskiest assumptions more often invalidates (versus validates) your ideas.
And this is still progress.
“I have not failed 10,000 times—I’ve successfully found 10,000 ways that will not work.”
- Thomas Edison
While achieving problem/solution fit does not guarantee you will not fail down the line for other risks, not achieving it (with evidence) does invalidate your business model — letting you eliminate a dead-end. And because it takes just three months, it’s probably the best time investment you can make to save you needless heartache later.
Startups that succeed are those that manage to find a working business model before running out of resources. The key to doing that is maximizing both quantity and quality of learning iterations.
This is the long game of entrepreneurship.
Have faith in yourself. Be ruthless with your ideas.
And no, if you stack your learning, it shouldn’t take anywhere near 10,000 iterations.
