A Product Market Fit Show | Startup Podcast for Founders
00:02:36 · Pablo Srugo, Rob
[00:02:36] S0: Basically what you're saying is, look, being an entrepreneur is like 90% practice, 10% theory, and I'm spending all my time on the 10%. So basically <laugh> , it's like , what am I doing [00:02:44] S1: <laugh> . So we're trying to dissect it and we're trying to get it to a point where it's like, this is the formula to being an entrepreneur. And I'm like, well , you know, I don't know if you can do that. I don't, I don't think that that
00:02:53 · Pablo Srugo
[00:02:53] S0: Exists. I mean, that's totally legit, right? That's totally legit. And that was one of my frustrations even and I talked about, which is like, it's not really a recipe in , in any meaningful word , meaningful sense of that word. Because like you do all these things and you still nec you might not have product market fit, but I do think they are best practices, right? So just to go through them again, like the five of them. The first one is before startup mode is research mode. The second one is only the insanely focused survive. You have to be in the market to win the market. Uh, the fourth one is find value, not growth. And the fifth one is pivot harder faster, obviously. We'll, we'll go through all of them, but, so starting at , at the first one, I think this is one that I do believe, especially amongst, it's not actually just first time founders. I, I've seen it in repeat founders too, but specifically the repeat founders, that their first one was almost like quote unquote too easy. Nothing's really too easy, but sometimes things just kind of work, you know what I mean? You put something out and , and it just, you get the poll and, and, and then you end up getting an exit and you're like, wow, okay, that worked out. Let's do it again. And on your second one, you're more polished. You've certainly lot , a lot , you've learned a lot of things, but you actually didn't necessarily go through the, the painful part of finding pain points. You kind of just landed on one and you just assume if things look cleaner , more polished, it was gonna work. First time founders, especially though, like, I just find, you know, because I worked with probably a hundred pre idea , like idea stage companies through when I was an entrepreneur in residence. And that was my number one finding was just, it was, it was like they, they had an idea and they're already out, you know, trying to lean, start up that idea, trying to go through the Eric Ries motions, the MVP stuff. And I'm like, man, everything you're doing doesn't matter because fundamentally, I don't, I don't see anything like, none of your telling me tells me that you're even solving a real pain point. So that's kind of where the research piece comes from.
00:04:38 · Rob
[00:04:38] S1: Research is, is a, is a really interesting component to it that you need to do. Like, I don't dissuade this, but I , it , it's almost like when you get older and you've gone through the scars of building a business, that's, that's when research is done. You know, like in the next startup that I do, I'm gonna research a little bit more than the last one. And then the last one, last one.
00:04:58 · Pablo Srugo
[00:04:58] S0: I mean, it's true looking just to , to play almost devil's advocate myself, like even on the show itself, we spoke with, for example, Alan from, from wapa . And there's a few things there that, that don't necessarily fit with the research piece. Probably the first one being that like, he just kind of put something out. I mean, he had this bigger idea of, you know, wapa ultimately today is , you know, they sold for like over half a billion dollars. They're , um, a marketplace for readers and writers. So anybody can create a story and anybody can read it. There's like a hundred million users today, and he kind of had high level , at least is what he told me when I spoke with him. This idea that user-generated content would be a really big deal. This is in the, like in the two thousands pre iPhone era, right? We're talking about, but he kind of saw that UGC with Facebook was out, and so you were seeing more, more of this user-generated content stuff playing out. He thought this was gonna have an impact when it came to, to storytelling and story writing . Um, but his first app was like literally from flip phone . It was flip phone era. Like it's pre-phone, there's no app store and it's flip phone era . People have to like, you know, connect to, like, they have to do a million different steps just to get their app on their phone. And all it lets 'em do is read classic stories, stories that are out of public, like out of like in public domain, like the The Great Gatsby on their phone. And, and like, there was no research, you know, realistically for that. But the way I like to reframe it is, it's kinda like, as a result of there being no real research, he told , he was in the market. Actually, one of the craziest stories of this man is he's like, I still have, I was in the market for two years before I had the first user upload a story. And the other thing he told me was that he's like, at one point he had many discussions about giving up, but I told them , I said, listen, we only spend like <laugh> , I think it was something like, we spend like $5 on hosting a month and we only, and we make $2 <laugh> a month on ads. So we're basically break even literally like , this is what he said to me. And he still has that check.
00:06:54 · Pablo Srugo, Rob
And so my point is, the ones that don't do research, like whether it's because they've worked in the industry and so they've done implicit research for many years or explicitly because they actually go and do customer discovery and all that stuff, tend to do it almost in practice. It just takes longer. And they do it like while they're in the market. But, but I don't know of many examples where somebody's not from an industry doesn't do customer discovery and hits it on the nail like right off the bat, except like a Facebook or Snapchat or like these really exceptions of exceptions, you know? [00:07:26] S1: Yeah. But you know, that Facebook wasn't even his idea. So it , uh, really doesn't , uh, somebody else did the research. Funny mean , [00:07:31] S0: Whenever I mention Zuck, you just , you just hate on him , you know ? And I just gotta stay away. I gotta stay away from that [00:07:35] S1: <laugh> . No , but it , it , it's true though. You have to have a domain expertise. And, and that's where that, that the idea of hobbies comes into play. Like everybody says, like, do what you love, find something other , like , I mean, that's total crap. Don't do that. Like, that doesn't work. Uh , you're just gonna ruin the thing you love <laugh> by making it work, right? Like there's a re but [00:07:57] S0: You mean people will buy my paintings z <laugh>. [00:08:01] S1: That's so true . [00:08:01] S0: They actually, they won't. That's thing
00:08:02 · Rob
[00:08:02] S1: I've just got these like bootleg copies of myself playing the guitar. I'm sure somebody wants them . They don't, they trust me. They don't. What ends up happening a a lot of the time is that, is that your, your domain expertise is the thing that becomes very visible to you. Like you see it and then you , you test that market and, and it's where you, you are completely a fish outta water . A good friend of mine when I was a kid , um, like his dad made a , you know, millions of dollars selling his business and uh, and then he went bankrupt. And this stuck with me as a, as a young entrepreneur. And I would ask, why? How did you go bankrupt? Man? You lived on this great street. You had a pool, you're like, rich, rich, rich, blah , blah . I drove, Beamers had the first cell phone and I've ever seen in a car, even like the bricks. He couldn't use it 'cause it was like $10 a second. But he said, Rob , like I put a million dollars into an apartment building. I'm like , okay. Like he , he bought into an apartment building, he's like, I have no idea how to run an apartment building like that stuck with me so much. He's like, he was an expert in his field and he succeeded. And then he got, he got like, the ego gets involved and he is like, here, easy peasy. Here's a million bucks, here's a million bucks, here's a million bucks. Oh, by the way, what now I'm on food stamps, gotta sell the Beamer. And, and , and that, that happens more often than not . The ability to, to , uh, to be able to control yourself in those situations. Like , it , it is, it is imperative that you understand sometimes that you, you hit lightning, but you didn't hit it by accident. You hit it because you had that expertise.