A Product Market Fit Show | Startup Podcast for Founders
00:13:40 · Tushar Mishra
[00:13:40] S0: So number one, we were ruthless with our qualification because we'd had that sort of experience. And within those two and a half years or so, we multiple times had those experiences where, okay, there's something working and you get really excited and now you feel like you got it. And so we were very cautious to watch for noise versus signal. And so the first thing we did was we were ruthless in our qualification. So, we basically gave them every opportunity to not use the product, which is why you're selling and you're giving demos. You're talking about, okay, here are the use cases. Here are things that you're talking about that we would never build or we would not build. Focus on who this customer is and can I find more customers like this? Or is it, I just found somebody who has a problem that I'm looking to solve for? And I'll walk through, we had a system basically to do that and was part of like a big list that we had. And then eventually when you start onboarding, work very, very closely right from onboarding to make sure everybody is set up on the app. They have actual use cases and they have something that they can measure to know if what you're doing is working for them or not. So qualification, knowing that they actually have a problem and this is a customer that I can find again and again. A lot of focus on onboarding, which is making sure they're actually set up for success. And third, actually setting those success criteria so that us and them have a clear understanding of what it means if this works for you.
00:15:09 · Pablo Srugo
[00:15:09] S1: You mentioned you have like a list on qualification. Let's go through that.
00:15:11 · Tushar Mishra
[00:15:11] S0: Yeah. So this... We did it in two different ways. So number one, qualification was the messaging qualification. For example, if I'm... Tomorrow, if there's a bike repair shop that comes to me and says, hey, I have the same problem. Can you solve it for me? Versus there's another business like the one that we signed with 50 locations, which is a franchisor. What is the difference between them? Right? So in messaging, it's really important. Or when you're doing outbound, like repeatability becomes really important. There needs to be something that is common across these customers. They need to speak a shared language. They need to speak or have shared goals that now I can scale across. So that was first level of qualification, which is knowing and basically being non delusional to yourself, knowing that is this the actual customer that I'm building for? The second level of qualification comes in customer commitment. And the list there basically starts from how sharp is the pain. Because if the pain is not sharp enough, they just like you, then those are not the right reasons they would actually not use the product. So how sharp is the pain? Second, is this pain sharp enough that they would actually pay for it? And third, do they understand what will happen if this pain is solved? And the third part is more nuanced because a lot of times you would find, especially when you're trying to do something new, you would find a lot of customers want to solve a problem, but they don't know what the final outcome looks like. So, they have a fantasy in terms of, I want you to come and train our employees, right? Maybe that's the solution that they have in mind and the output that they have is, hey, if you would restrain because you would give them a certificate. So those were the three things that we use to really qualify them once the messaging or the ICP qualification was done.
00:16:56 · Pablo Srugo
[00:16:56] S1: So this is kind of on the market side. In other words, by the time you set your line with this customer, you need more or less what you needed and, you know, they happen to be a franchisor, they happen to have 50 locations, so their need kind of is a fallout of that. Had you also made some big changes to the product over those two... I mean, obviously, you changed the product over those 2.5, but was there any big things you can point to in the product side of the product market fit equation that also puts you in a place where you are ready, let's say, to deliver real value to this customer?
00:17:21 · Tushar Mishra
[00:17:21] S0: Absolutely. So... And I can talk through some of the evolution there. Right? So when we started out, it was simple task management. People set up one or two checklists and then they didn't set anything up. So nobody used it. When we started having conversations and these conversations are not about why aren't aren't you using the product, we just want to understand, okay, let's go back to the pain. You still cannot figure out if somebody opened the store at 7AM. How does that person know that they need to open the store at seven What are the things that they need to do in order to open the store at 7AM? So start to do more research and try to figure out how do you think about that problem. That's when we learned that most of what these employees do at the location is coming from this binder that's often in the back office called standard operating procedures or ops manual. So the first product evolution was we said, okay, you have this ops manual, we would make it digital. Right now it's in pen and paper. Your brand, when they want to make a change, it takes too long for you to actually teach something to the employee, you need to refer back to the pages. If they need answer to a question, they need to ask you. So you make it as true. They can ask questions whenever they have a problem and then rolling that out becomes easy. So there was just a digital SOP. So now there are some companies like knowhow and think Trane will start that way that do that, like documenting your ops processes. So that was sort of the first iteration. Now that worked and we got a few customers who were really interested in this. In fact, we got one convenience store chain that had about 28 locations and they were just starting to franchisee and they were like, Okay, no, we really need this. But that's when we started hearing, this is great. We have these SOPs. But eventually what we want to do with these SOPs is actually teach employees these SOPs. And today, how we do that is we get these two hour long videos from HQ that the 16 year old kid doesn't want to watch or doesn't actually understand anything if they watch. And so it's mostly the supervisor that I'm paying more than everyone else. I'm paying $35 an hour. He's wasting two, three hours sort of every day to teach these employees.
00:19:25 · Tushar Mishra
And because my attrition is extremely high, most of these pieces are running through new set of employees every few months. That is a big, big cost for me. So the second evolution was, okay, now how do you take these SOPs and make it teachable, coachable to their frontline employee? And this is where the first discipline and product market fit was important because when you get into the realm of training, depending on who you talk to and who you listen to, it's very easy to start building an LMS. An LMS is a learning management system. Like, there are big ones. It's SCORM. We'll again move to that two hour long video that no kid wants to watch. So our approach to that was, again, outcome driven. Hey, you wanna teach this guy? He's on TikTok all the time. So I'll have these like whatever manual that you have. I'll break it down into snippets that they can watch. And by the way, you can just record a video. You don't need high level production of somebody like cutting a veggie, here's how you saw it, and actually upload it in your training. So that was the sort of the second evolution of the product, which was a big, big unlock because that's how we got a ton of new leads and new customers. So from a positioning perspective, literally our email used to say TikTok style training, and we got a ton of leads sort of through that. Now as we started to do that and these businesses started to take us seriously and wanted to use this or roll it out or test it out. We now started getting more, which is an extension of that. So now you've taught my customer what to do, but I still need to find a way to figure out if they're actually doing that thing or not, which is again going back to the task of the checklist portion. So now I have the SOP. I've taught your employee. But now from that SOP, I can also almost make that SOP actionable. So I can generate a list automatically from that saying that here are 10 things that you have to do every morning. And then instead of forcing it on them every day, I can pick and choose. So here's a new employee. They have to do it every seven days and then it goes away. And then it randomly comes in and we do a check. So So that was sort of the third evolution. From there, it came, okay, now you have my SOPs, you have my employees. I have this Excel sheet that I have to maintain where I actually add all my franchisee information.