#8: “It’s time to kill the PMF concept” 🗡
Rand Fishkin on an alternative to the simplistic conclusions of PMF, Laura Behrens Wu on discerning tech's systemic bias against women, Tope Awotona on the compounding nature of hiring mistakes.
Hi there,
Welcome to the eighth edition of The Baton. A fortnightly newsletter that brings you three, hand curated pieces of advice drawn from the thoughtful founder-to-founder exchanges and interviews taking place on Relay and the interwebz. So, stay tuned!
In this edition, you’ll find instructive and inspiring pickings from the brains of SparkToro’s co-founder Rand Fishkin, Shippo’s co-founder Laura Behrens Wu, and Calendly’s founder Tope Awotona.
#1. Rand Fishkin, co-founder and CEO of SparkToro, alarms us about the true/false simplicity of product-market fit, introduces an alternative framework that accounts for the many complexities of startup traction, and urges us to “kill the concept,” “mostly because, like so much of tech startup world’s insular lingo, it was never a good idea in the first place.” (Source: SparkToro)
Founders and product builders ignore many of the real inputs that go into gaining market traction, selling their product, or earning users, especially pricing, positioning, and brand. It’s often the case that investments in these tactics—modifying price points, positioning your product’s solution differently or to a different market, and/or earning more brand recognition, likability, and trust—will have huge impacts on growth. But magical belief in a “product-market fit inflection point” shifts all the weight onto the product itself, and limits creative ideas around what might solve the company’s issues.
The real question should be: is there any value in thinking about product-market fit as a true or false statement? Does the startup world glean greater survival rates or make better products or prioritize their team’s time better by thinking about this problem as a binary? Should we listen to firms like Andreesen Horowitz or startup marketers like Brian Tod or influential investment partners simply because they’ve watched, advised, or invested in lots of companies who’ve failed at this (and a few who haven’t)?
To me, it’s a clear no. I cannot see a benefit or value-add to product development, gathering of customer feedback, marketing, or any aspect of the company’s strategy or its tactics. The only way fit-vs.-no-fit is helpful is in its simplicity. And by now, I should know better… We should know better than to trust simple > complex when it comes to building and marketing things to people...
The most obvious ways to improve on the product-market fit mindset are:
1. Remove the concept of a binary yes/no
2. Apply a range (since any useful metric falls along a spectrum)
3. Use segmentation (as product and marketing professionals need these to wisely prioritize work)
Note: Tomorrow, in a Relay AMA, you can tap into Rand’s ever-expanding pool of SaaS know-how and ask him all about pushing past the brokenness of PMF, alternative forms of funding, generating demand not just capturing it, the criticality of audience research, and why he’s questioning all the givens of starting up with his new venture! (If you’re a founder and not on Relay yet, drop us a note for an invite!)
#2. Laura Behrens Wu, co-founder and CEO of Shippo, details the many subtle, systemic biases faced by women in tech, why she used to hate talking about being a “female founder”, and what all of us can do to build more welcoming and diverse orgs. (Source: Y Combinator)
"I've been lucky that I've never experienced direct sexual harassment like that. However, I've gotten used to being one of the few females in the room especially B2B CEO dinners. Somehow they're not that many B2B female founders. And many times when I'm outside of the office and people ask me what I do for Shippo, they're surprised to hear that I'm the founder and CEO. And I never quite understand why. What did they expect the founder and CEO of Shippo should look like?
There was one time when I was pitching a male VC for my series A. And after the pitch, his first comment was, "This is a cute little business you've built." And there is really nothing cute about a shipping API. So I used to hate talking about being a female founder. I used to hate being put into that box. I dislike being part of these female founder lists because the market really does not care if this company is run by a female or not. Customers choose to go with a product that's best. And I wanted Shippo to be the best. Period. Independent of my gender.
I used to live by the mantra, "To be so good that they can ignore you." And in the last year, my attitude to that has changed a little. I realized it's naive to believe that if you work really hard you won't be discriminated. I realized that it's not always on the women to prove themselves. It's a problem with the system. And good news is that we, everyone here in this room, is able to make a difference. We can make a difference by starting companies and building company cultures that women enjoy working at. We can make a difference by being role models for the next generation of female entrepreneurs. And we can make a difference by generating outstanding returns for the investors that have placed a bet on us. And I'm excited for everyone here to help us make that difference."
#3. Tope Awotona, founder and CEO of Calendly, looks back at early scaling challenges that “handcuffed” their potential, ill-informed hiring decisions that rapidly compounded, and what pulled them back on track. (Source: The SaaS Podcast)
For me, the most difficult parts, the ups and downs, have really come as we scaled the business. The reason is, I think that in the early days, you don’t have much to lose, right? You know, like, you have a lot less to lose, as you have more to lose the impact, the weight of every decision is a lot bigger. And you know, you have more customers, right? You’re not working from a clean slate anymore. And your customers have certain expectations, and you know, they all want different things. And you’ve hired people, and you’ve made promises to them. They’ve left their jobs to come work for you, because they believe that you’re doing something really special.
So, for me, I think the challenging part was I had all these responsibilities to all these different people. And in some ways, I felt like they handcuffed me and the business from, you know, some of the other things that the business should do. So all that was really rough. And there are times in which you know, as you’re growing, you think, you know, what a role should do and what kind of a person you needed in the role, but because you’ve never hired it before, you know, you do a poor job of filling the role. And then to compound that maybe you hire five of the same people in that role that you’re still learning. And two months later, you find out that “man, I hired all the wrong skills for this role. How do I fix it with these people? How do I put these people into other jobs that are important for the company and part of the company’s growth and that they’re still interested in?”
So kind of juggling all those mistakes around org design, around hiring too fast, hiring too slow, not bringing in senior leadership soon enough. Those are some of the mistakes that I made that really crushed me. But over time, I recognized them and I surrounded myself with really good advisors that helped me see it. And I started to build a team out in the right way. Invest in our culture, and values. And all those things have just made a difference to kind of put us back on the right track for growth and also having a fun and exciting work environment.
Hope you enjoyed reading this edition of The Baton. We are trying to bring you the most nuanced insights from SaaS founders across geographies. And we’d love to learn which SaaS subject would you want us to cover next/more of? Let us know? :)
Until next time,
Astha and Akash