EXTRA EXTRA

A newsletter about early sales from The Extra Group

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I’m not one for startup hacks. In fact, what I do is pretty much antithetical to the idea of a quick fix.

But here’s one "hack" I believe in that I don’t see folks talk about much: underestimate your product-market fit.

I define product-market fit as “consistently closing deals by selling the same product to the same kind of customer with a repeatable GTM playbook.” I’ve previously outlined the time it takes to get there – it’s going to take 18 months at the very fastest.

But too often, I see founders overestimate how far along they are on the journey to product-market fit. They’ll mention they’re “pretty close” to product-market fit, but they don’t have consistent sales or a reliably accurate GTM playbook.

I think what's happening here is that founders can conflate closed-won deals, happy customers, or a certain amount of monthly/annual recurring revenue with product-market fit.

Revenue wins are massive accomplishments that should be celebrated. A lot! But, they do not mean you have product-market fit.

I fell into this trap at my startup, and only now with hindsight, I understand how costly that perspective was.

Instead of overestimating your PMF, I recommend you underestimate it – or even better: just assume you don’t have it, and sell, sell, sell. This approach creates a ton of efficiencies and gains that will actually accelerate the time it takes to find the elusive, all-important product-market fit. Here’s why:

1. You hear more market insights during sales calls

Founders who assume they’re further along on the PMF spectrum tend to approach selling in a more rigid way. Inherently, they’re thinking they have more figured out than they do. These founders might start operating with a bit of a “fixed mindset,” where they aren’t always open to feedback, or struggle to accept losses or mistakes.

Conversely, if you're assuming you don't have PMF yet, you’ll operate with more of a “growth mindset,” where you're eager to learn from any and all setbacks, lost deals, or imperfect sales calls.

The more you embrace how much you have to learn, the more able you are to hear fresh and meaningful insights from prospects. You’ll notice the unspoken hesitations of a prospect, and you’ll dig deeper, even if it exposes a harsh truth. You’ll welcome prospects to tell you their honest feedback, and you won’t take it personally when they do.

Armed with tons of valuable insights, you can iterate upon your sales pitch and strategy until it hits, instead of trying the same low-yield approach for too long.

2. The market can guide your product vision

Nearly every founder agrees conceptually that their startup “shouldn’t be a solution in search of a problem.” But in practice? I see some founders operate as if their early market traction means that their product has found its problem, no edits. And that’s where the trouble lies.

We need to relinquish our vice grip on our product and our vision for it.

When you lighten up your grip on your product vision, you become more open to new market opportunities that will get you to true product-market fit faster. A few examples of this:

• Segment. They spent over a year building an analytics product that didn't have tons of traction. As a growth hack, they built Analytics.js, which is a library that helps users send data to multiple analytics platforms through one tool. They started selling it, there was more traction, and it ended up being acquired for $3.2B.
• Loom. They started as a user testing tool, but they weren’t having much traction. They noticed that one potential customer used one small sliver of the product, the screen recording function, to submit feedback. They started selling that function (stripping away the rest of the features they'd built), found traction, and were acquired for $975M.
• Instagram. They started as a check-in app with photo-sharing and gaming features. Users predominately used the photo-sharing component, so they tried monetizing it, and ended up being acquired for $1B.

None of these successful pivots would have happened if the founders were not willing to accept that there wasn’t enough demand to scale, and if they weren’t openheartedly listening to prospects' wants and needs.

3. You’re more attractive to investors

If your plan is to take venture capital, you need to make a great impression on funders, of course. That doesn’t require having everything figured out. Early-stage investors don’t expect that. While they’ll want to see some revenue (even at pre-seed), they’re not expecting real product-market fit until Series A.

What they do care about is the founder’s approach: they want confidence, yes, but they also want self-awareness and transparency. Paraphrasing from Khosla Ventures’ fantastic “Nail Your Raise” deck, investors are judging you all the time. (Sorry for the jump scare.) They’ll notice if you’re hiding things or overselling your traction, even if it’s unintentional.

Per that same deck, investors tend to swing between two emotions: greed and fear. Founders must do everything they can to mitigate that fear.

If you say you have more product-market fit than your numbers show, this will swiftly trigger an investor’s fear button. They’ll either judge you for not having a sense of what real PMF is, or they’ll become concerned that you’re overselling. It can be hard to bounce back once a funder starts to lose confidence or trust in you. Better to underestimate how far you are towards PMF and let them correct you if they think you’re further along.

When it comes to product-market fit, it’s time to channel Coach Taylor of Friday Night Lights.

Clear eyes, full hearts, can't lose... emphasis on the clear eyes. 👀

This is Extra Extra, a newsletter about the tactics and mindsets that drive early sales. I’m Caroline Fay, an exited social impact founder who’s spent my career launching and selling new products. I help non-traditional tech founders build sustainable, recurring revenue.

Caroline Fay

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