A Product Market Fit Show | Startup Podcast for Founders
00:34:49 · Pablo Srugo, Damien Lewke
[00:34:49] S2: And that was another what? Like, $4 million? [00:34:51] S0: $6.1 million. So we were $8.5 million raised, yeah, so. [00:34:54] S2: Where were you at customer wise in that second half of '24? [00:34:59] S0: So we signed our first design partner when we had one employee, which was cool. It was actually at Black Hat. I can't share their name, but they are a paying customer now, and I'm very grateful for their early partnership. And actually it was really helpful, right? Before you even can deploy, cause the product was so early. You know, I pitched it as an architecture partnership. Hey, do you just want to give feedback while we start poking around and building this? It was so valuable. We had a few key early architecture partners back then and it made such a difference, Pablo. Because, yeah, we've done the ninety-ninety, we had the roadmap, but to keep getting feedback continuously, right? Just allowed us to, not just in terms of how the system worked, but customer experience, build right from the outset, which was really, really awesome to see.
00:34:59 · Damien Lewke, Pablo Srugo
[00:34:59] S0: So we signed our first design partner when we had one employee, which was cool. It was actually at Black Hat. I can't share their name, but they are a paying customer now, and I'm very grateful for their early partnership. And actually it was really helpful, right? Before you even can deploy, cause the product was so early. You know, I pitched it as an architecture partnership. Hey, do you just want to give feedback while we start poking around and building this? It was so valuable. We had a few key early architecture partners back then and it made such a difference, Pablo. Because, yeah, we've done the ninety-ninety, we had the roadmap, but to keep getting feedback continuously, right? Just allowed us to, not just in terms of how the system worked, but customer experience, build right from the outset, which was really, really awesome to see. [00:35:42] S2: Tell me more about these. Everyone is doing design. I mean, you used to do beta, you know, and now you do design partnerships, architecture, whatever. Everyone's doing them and one of the challenges I have as VC looking at these is which ones are meaningful signal and which ones are just kind of playing along. It's not a high bar, generally speaking. It depends on the type of customer, obviously, but it's not the highest of bars to get somebody to be like, yeah, I'll use your product and give you feedback. I'm curious, your experience, how did you know that the feedback was real, that the pull was real, that the value was truly there and that many of these would convert to paying customers?
00:36:12 · Damien Lewke, Pablo Srugo
[00:36:12] S0: I mean, I'm actually excited to say that every single one of our design partners converted to a paying customer and that was a really, really exciting moment. But I work with a lot of founders now who are thinking about design partnerships. Because our design partner program did end up being effective. My suggestion is you actually have to break up design partnerships into stages. Early on your design partnership, you are not sending them a POC document that says you will be entitled to a discount after this time, right? You don't have something to sell yet. The idea is, hey, we're going to work through this and eventually you set the expectation. I'm going to send this and you will get a discount, right? Once this product goes live. But it starts with architectural partner. Early design partner. Hey, we've deployed it. Does this work? How is the deployment process? Are things breaking? How is your experience? [00:37:00] S2: And the ask is probably what time touch points? If somebody is not responding, you're like, okay, let's not invest our time there.
00:37:00 · Pablo Srugo, Damien Lewke
[00:37:00] S2: And the ask is probably what time touch points? If somebody is not responding, you're like, okay, let's not invest our time there. [00:37:05] S0: Yeah, you want to keep it super tight. So I get them to commit to thirty, or I got them to commit to thirty minutes every single week. I will not miss the meeting. Please don't miss the meeting. Let's do thirty minutes a week and most people are willing to find thirty minutes. And I would challenge, especially early on, if someone is not willing to give you thirty minutes a week. How much do they really value the problem you're solving? And then the final phase, which was as we were starting to shift into paying customers towards the end of last year. It was kind of end of summer into fall. It was really more feature design partners. Hey, we're building this thing, right? What's your feedback on this? What else do we need to do to earn this price that we've suggested? And that's really how we made the transition. So you want to phase the design partner approach and don't overcomplicate it, right? Ask for time, they'll commit to time. You build a relationship and eventually, if what you do is valuable, they will pay for it. [00:37:51] S2: When did you start? When did you get your first revenue? [00:37:55] S0: Yeah, Fall of last year. [00:37:57] S2: So there was a year of, you raise your pre seed and then a few months go by, you do design partnerships probably Q4 of '24, Q1 of '25, those six months, is that right?
00:37:57 · Pablo Srugo, Damien Lewke
[00:37:57] S2: So there was a year of, you raise your pre seed and then a few months go by, you do design partnerships probably Q4 of '24, Q1 of '25, those six months, is that right? [00:38:09] S0: Yeah, I mean, it was basically a year of design partners before we saw revenue. But the key was, it was a personal opinion, I wanted to get to a point where the revenue was a slam dunk and no brainer. Because ultimately, once you get on the revenue train in a startup, you got to start scaling. [00:38:26] S2: The clock is ticking and it's a funny thing you say. You really want to almost like you pulling it back. So when you let go, it's like whoof. [00:38:32] S0: It's funny because it also teased out a really important piece of product market fit for us, which was building a repeatable POC process. So the idea, because we kept iterating through these design partnerships, right? And seeing what worked, and the cadences, was it allowed us to start structuring a real proof of concept process. So net new, if we were to engage, how do we engage? And, you know, back to this original point of, hey, what was your moment of Product Market Fit? By the time we hit that Fortune 500, we had a month long POC process that required two hours of customer time. We had a playbook that we knew how to run and it just kind of followed, right? That muscle movement had been built. [00:39:13] S2: And that was when? That Fortune 500 customer? [00:39:15] S0: March of this year.
00:39:15 · Damien Lewke, Pablo Srugo
[00:39:15] S0: March of this year. [00:39:16] S2: March of '26. So a year after, let's say, you converted those first design partnerships. This moment happened. You had a year of, in production and trying out different POC structures to get there. [00:39:26] S0: Yes. Oh, and Pablo, did we try a bunch of different structures.