Product Market Fit is a journey, not a destination. Find out what Chetan Kumar, Mentor, Microsoft Ventures India, has to say about this journey.

1. By
Chetan Kumar
For Microsoft Ventures, MasterClass – July 15th 2015

2. Who Am I?
• Mentor at Microsoft Ventures
• Entrepreneur – Entertainment discovery startup with a batchmate
• Former Director – Consumer Electronics at Flipkart
• Former APAC lead for mobile banking products at Citibank
• Held roles in strategy, product, operations & marketing globally (US, SE Asia)
• MBA from Kellogg School of Management
• CA (a long time ago!!)
Twitter: @chetan226
Email: kumarchetan@gmail.com

3. Why the fuss about PMF?
•Over 40% startups fail due to lack of a good ‘market’ - That’s more than any other
reason (including funding, team, timing, etc.)
•I think of PMF as a concept to guide the limited Time, Money and Resources
towards a focused solution-oriented objective.
Marc Andreessen “Product/market fit means being in a good market with a product
that can satisfy that market.”
What we will cover in today’s session
• Breakdown the product-market fit components
• Address key questions for each component
• Discuss case examples
• Summarize takeaways in a self-evaluation worksheet
• Q&A
These are my views and are neither exhaustive nor conclusive!

4. Who came first?
THE PRODUCTTHE MARKET
• In my view: The market is the ‘why’ and the product is the ‘how’
• The market may be evident or latent, but exists!
• The product therefore, is a solution to an….
Articulated
problem
Unarticulated
problem
OR

5. The Wrigley’s Story
Started as a soap
salesman
Offered baking soda cans
as ‘premiums’ to
merchants
Baking soda was so
popular, he switched to
this business
Gave an offer of free gum
which was a hit
From soap to baking
soda to chewing gum,
Wrigley’s followed the
market!

6. Defining the Market
• Who is the market?
• Who is the ideal target
[within this market]
• More qualitative
Positioning
• Throwing a ‘net’ around
the market
• Having a point of view
• More quantitative
Sizing

7. Defining the Market
• Who is the market?
• Who is the ideal target [within this
market]
• More qualitative
Positioning
• Throwing a ‘net’ around the market
• Having a point of view
• More quantitative
Sizing
For World Wide Web users who enjoy books, Amazon.com is a retail
bookseller that provides instant access to over 1.1 million books.
Unlike traditional book retailers, Amazon.com provides a combination
of extraordinary convenience, low prices, and comprehensive
selection.
TRADITIONAL MARKETING POSITIONING
For ____________ (target customer) who ____________ (statement of
the need or opportunity), our (product/service name) is ____________
(product category) that (statement of benefit) ____________ .
Facebook’s mission is to give people the
power to share and make the world
more open and connected.
…to offer designer eyewear at a
revolutionary price, while leading
the way for socially conscious
businesses.
(in 2001)

8. Defining the Market
•Some approaches to defining the market size:
• Industry reports
• Me too’s globally
• Bottom’s Up or Top Down
• Drawing a parallel
• Innovating on a market created by some other product
• Defining a new market (less used)
No perfect answer, but one must have a point of view.
TODAY TOMORROW
$5Bn
$12Bn
$10Bn
$20Bn
*Illustrative based on public reports
• Who is the market?
• Who is the ideal target [within this
market]
• More qualitative
Positioning
• Throwing a ‘net’ around the market
• Having a point of view
• More quantitative
Sizing

9. So what is the question?
A NEED A WANT
….To which your product is the solution?
ARTICULATEDUNARTICULATED
Your
Idea?
Lower
costs
Overtime
Commoditization

10. Types of solutions
•Cost
•Efficiency
•Convenience
•Transparency
•Information sorting (Search,
Discovery, Reviews, Listings)
•Other? (List your own……..)
Example Core solution
Uber, Ola All of the above
AirBnB Cost
Twitter Information
Zomato Information
You improve your chances by solving deeper for a few things at first
Shared
Economy
Marketpl
ace
Crowd
Sourced
Platform Other
Manifestations

11. MVP & Positioning
Rome wasn’t built in a day………..
Early stage Current Positioning
Air BnB Stay, B’fast @low
cost
Photography, insurance,
home cleaning, Key
mgmt., etc
More than a place
to stay at a low
cost
Slack Corporate
messaging (search,
sync, file share)
Full CRM, support for all
channels, easy
integrations, etc.
Reduction in cost
of communication,
less email
Uber Solved taxi hailing
experience
Luxury cars to
Helicopters to grocery
Makes it easy not
to own a car
Snapchat Private messaging
with photos
Stories, Advertising, etc Social app without
the history
Flipkart Books Everything! Online megastore
The ‘Viable’ in the MVP is perhaps more critical than the product itself
Source: growthhackers.com, web

12. Competition & Pitfalls
Competition:
“If we can keep our competitors focused on us while we stay focused on
the customer, ultimately we'll turn out all right.” – Jeff Bezos
“You can only avoid competition by avoiding good ideas.” – Paul Graham
Timing: Too Early or Too Late?Funding: Raise enough money to get to PMF
and each time until you do, after that it should
get much easier
Team:
“When a great team meets a lousy market, market wins.
When a lousy team meets a great market, market wins.
When a great team meets a great market, something special happens.”
-Marc Andreessen quoting Rachleff's Law of Startup Success
&..Targeting, Product Vs Problem centricity

13. 3 mini Case Studies
Problem/
Desire
Market
Product
Approach
Competition
Hard to find good
Japanese food
News in local language
for migrants unavailable
Recharges meant
physical visits/ coupons/
cash
Urban rich: 1% of
urban popl. ~ 1MM
Literate migrant
workforce ~ 100MM
Urban mobile
subscribers ~ 400MM
Sushi delivered at
home via App
Content aggregated on
App
Mobile wallet
Target the market via
special partners,
advt., quality, etc
Launched across mobile
platforms; got word of
mouth traction
Initially, targeted only
recharges, then products
and services. Mass Advt.
Other cuisines
delivery
Launched across mobile
platforms; got word of
mouth traction
Initially, targeted only
recharges, then products
and services. Mass Advt.
All illustrative figures

14. Worksheet
What problem are we solving? Articulated/Unarticulated
What is the market for this solution? (positioning + size)
How will the product address this problem for the target market?
What is the degree to which I must solve (MVP to next version)?
What do I know about competition and other factors?
My biggest area of work in the next 3-6 months is:
My two most critical resource requirements are:

15. Summary
•PMF is a process, a journey not an event!
•Address a need or a want, but one that is not a
marginal problem
•Have an going in hypothesis of the market size
•Build as deep a solution as possible (MVP)
•Be ready to iterate, change, pivot
•PMF doesn’t mean perfection
•Goal is to get to that ‘fit’ in shortest time!

16. Thank you!
Twitter: @chetan226
Email: kumarchetan@gmail.com