Product Management 101: The Search for Product-Market Fit
ā¢Download as PPTX, PDFā¢
9 likesā¢8,463 views
This presentation discusses product-market fit and the lean startup methodology. It defines product-market fit as having a product that customers will readily pay for. The lean startup approach is presented as a way for startups to rapidly test hypotheses about their product and business model using minimum viable products and customer feedback to quickly iterate. Key aspects of the lean startup process include getting customer feedback early, focusing on validating the business model through experiments before scaling, and being willing to pivot the product or business model based on lessons learned from customers.
Product Management 101: The Search for Product-Market Fit
- 1. CONFIDENTIAL PRESENTATION | PAGE1 Product Management 101: The Search for Product-Market Fit Jeff Bussgang General Partner, Flybridge Capital Senior Lecturer, Harvard Business School @bussgang April 2013
- 2. CONFIDENTIAL PRESENTATION | PAGE2 Session Objectives ā¢ What is great product management? ā¢ What people mean when they use the phrase, āProduct Market Fitā (PMF), plus: ā Customer Development Process ā Lean Start-Up Theory ā¢ Help you devise your approach to achieving PMF and avoid wasting a lot of money
- 3. CONFIDENTIAL PRESENTATION | PAGE3 Context for My Perspective ā¢ General Partner at Flybridge Capital, early-stage VC firm in Boston/NY, current fund: $280M ļ70+ portfolio companies; seed and Series A focused ā¢ Senior Lecturer at Harvard Business School ā¢ Former entrepreneur ļCofounder/Pres. Upromise (acqād by SallieMae) ļVP at Open Market (IPO ā96) ā¢ Author: Mastering the VC Game
- 4. CONFIDENTIAL PRESENTATION | PAGE4 Startup 1. A team launching a new product under conditions of extreme uncertainty 2. A vehicle for testing hypotheses about such an entity 4 Entrepreneurship: the pursuit of opportunity beyond resources you currently control - HBS Professor Howard Stevenson Relentless Focus Novel/Innovative Resource Constrained
- 5. CONFIDENTIAL PRESENTATION | PAGE5 Customer Development Customer Development vs. Product Development Concept/ Bus. Plan Product Dev. Alpha/Beta Test Launch/ 1st Ship Product Development Source: Steve Blank
- 6. CONFIDENTIAL PRESENTATION | PAGE6 Old School Product Management ā¢ Report to: Marketing ā¢ Output: Requirements Documents ā¢ Methodology: Waterfall ā¢ Product lifecycles: Years ā¢ Decision-Making: Opinion-Driven
- 7. CONFIDENTIAL PRESENTATION | PAGE7 Modern Product Management ā¢ Report to: CEO ā¢ Output: Prototypes ā¢ Methodology: Agile ā¢ Product lifecycles: Weeks ā¢ Decision-Making: Data-Driven
- 8. CONFIDENTIAL PRESENTATION | PAGE8 Product Management Skills ā¢ Responsibilities: ā Define the new product to be built ā Secure the resources to build it ā Manage its development, launch and ongoing improvement ā Lead the cross-functional product team ā¢ Attributes: ā Ability to influence and lead ā Resilience and tolerance for amibiguity ā Business judgment and market knowledge ā Strong process skills and detail orientation ā Fluency with technology and implications on product design, business ā Design/UX instincts Mini CEO ā with none of the authority
- 9. CONFIDENTIAL PRESENTATION | PAGE9 The Lean Startup ā¢ Many startups fail because they waste capital and time developing and marketing a product that no one wants ā¢ Lean startups rapidly and iteratively test hypotheses about a new venture based on customer feedback, then quickly refine promising concepts and cull flops ā¢ Being lean does NOT mean being cheap, it is a methodology for optimizingānot minimizingā resources expenditures by avoiding waste ā¢ Being lean does NOT mean avoiding rigorous, analytical or strategic thinking 9
- 10. CONFIDENTIAL PRESENTATION | PAGE10 Lean Startup Principles ā¢ No idea survives first customer contact, so get out of the building ASAP to test ideas ā¢ Goal: validation of business model hypotheses, based on rigorous experiments and clear metrics ā¢ Minimum viable product (MVP): smallest set of features/marketing initiatives that delivers the most validated learning ā¢ Rapidly pivot your MVP/business model until you have validation and product-market fit (PMF) ā¢ Donāt scale until you have achieved PMF 10
- 11. CONFIDENTIAL PRESENTATION | PAGE11
- 12. CONFIDENTIAL PRESENTATION | PAGE12 Crossing The Chasm
- 13. CONFIDENTIAL PRESENTATION | PAGE13 Where are You? Before Product-Market Fit: Search & Validation ā¢ Lean startup approach ā¢ Hunch-driven hypotheses ā¢ Minimum viable product (MVP) ā¢ Customer development process ā¢ Selling to early adopters ā¢ Pivoting ā¢ Bootstrapping ā¢ Small, founding team ā¢ Product-centric culture; informal roles ā¢ Early in sales learning curve After Product-Market Fit: Scaling & Optimization ā¢ Building a robust, feature-rich product ā¢ Crossing the chasm ā¢ Metrics, analytics, funnels ā¢ Designing for virality & scalability ā¢ Challenges with corporate partnerships ā¢ Building a brand ā¢ Scaling the team; more formal roles ā¢ Scaling a sales force
- 14. CONFIDENTIAL PRESENTATION | PAGE14 Tools/Techniques ā¢ Structured idea generation ā¢ Business model generation ā¢ Customer discovery process ā¢ Focus groups ā¢ Customer survey ā¢ Persona development ā¢ Competitor benchmarking ā¢ Wireframing ā¢ Prototype development ā¢ Usability testing ā¢ Charter user program ā¢ A/B test ā¢ Conversion funnel analysis ā¢ Landing page optimization ā¢ SEM/SEO optimization ā¢ Inbound marketing design ā¢ PR strategy ā¢ Customer support analysis ā¢ Product feature prioritization ā¢ Sales pitch ā¢ Lead qualification ā¢ Bus dev screening ā¢ Net Promoter Score ā¢ Lifetime value vs. Customer acquisition costs 14
- 15. CONFIDENTIAL PRESENTATION | PAGE15 āLessons Learnedā Drives Scaling Concept Business Plan/Canvas Lessons Learned Scale Do this first instead of scaling (or raise seed round to test hypothesesā¦rigorously) Test Hypotheses Source: Steve Blank
- 16. CONFIDENTIAL PRESENTATION | PAGE16 Should You Always Nail It Before You Scale It? ā¢ That is, when is it ok to be a little āfatā? ā¢ If you are in a winner take all market ā¢ Deep customer lock-in / high switching costs ā¢ Network effect businesses ā¢ Capital is cheap ā¢ Executive team knows how to scale ā¢ Upromise example ā¢ Series A: $34m (March 2000) ā¢ Series B: $55m (October 2000) ā¢ Launch service: April 2001
- 17. CONFIDENTIAL PRESENTATION | PAGE17 Leading Thinkers/Books/Blogs ā¢ Geoffrey Moore: Crossing the Chasm (read this!) ā¢ Steve Blank: Customer Development Process (read Four Steps to the Epiphany) ā¢ Eric Ries: Lean Startups (read this too!) ā¢ Marty Cagan: Silicon Valley Product Group (great book and blog) ā¢ HBS Prof Tom Eisenmann: Launching Tech Ventures (great blog) ā¢ Sean Ellis: Startup Marketing (great blog) ā¢ Andrew Chen: Growth Hackers (great blog)
- 18. CONFIDENTIAL PRESENTATION | PAGE18 Additional Resources ā¢ My blog: www.SeeingBothSides.com ā¢ Quora on product management: ā¢ http://b.qr.ae/W1npOi (product mgt skills) ā¢ http://b.qr.ae/sYy4jS (Google product mgt) ā¢ HBS Case Note on Product Mgt - http://bit.ly/TQhw7w
- 19. CONFIDENTIAL PRESENTATION | PAGE19 Product Management 101: The Search for Product-Market Fit Jeff Bussgang General Partner, Flybridge Capital Senior Lecturer, Harvard Business School @bussgang April 2013
Editor's Notes
- In rough terms, tools in the left column are used pre-PMF, and those in the right post-PMF. A/B tests are used in both phases.