Finding a hidden need and rapidly prototyping and testing with users to develop a solution to their problems is key to building a successful company and staying ahead of the competition.

• 🤝
  00:00

  Founder of Weebly, Davidenko, will discuss how to find product market fit practically and effectively after 8 months of work, resulting in a record signup day of 30 users, and acceptance to Y Combinator with a TechCrunch feature the same day.

  • Davidenko, founder of Weebly, will discuss how to find product market fit practically and effectively.
  • We worked for 8 months before launching, with a record signup day of 30 users.
  • I called my co-founders the next morning and asked them to drop out of school and move to San Francisco with me, and they both said yes.
  • We drove up, interviewed, and got accepted to YC with less than an hour to go, and were able to get on TechCrunch the day of the interview.
• 🚗
  04:16

  Drove cross-country, worked 24/7, got press, and raised $650K on a $2M pre-money valuation after 20 months of finding product-market fit.

  • We packed up our servers in a car and dropped out of school in January 2007 after 11 months of allowing users to sign up and wait for access to their accounts.
  • I drove cross-country to San Francisco, worked 24/7 in a two-bedroom apartment, and got a TechCrunch press bike in January.
  • After 14 months of declining new users and less than $100 in the bank, the company successfully raised $650K at a demo day.
  • Raising $650k on a $2M pre-money valuation is considered above average, but today that number could be up to $20M.
  • It took 20 months to find product-market fit and start seeing daily user growth.
• 💡
  09:06

  Finding a hidden need and creating a new market is key to building a successful company.

  • A company goes through the stages of idea, prototype, product market fit, and growth to become successful.
  • Finding product market fit and hiring a world-class team are the two hardest things for startups.
  • Finding a hidden need and creating a new market is key to building a successful, scalable, and enduring company.
  • People need to find a hidden need and serve it better than existing solutions to be successful.
  • Pay attention to customers who are hacking your product to do something it wasn't intended to do and double down on that.
  • The iPhone enabled a whole new market of users and eventually cannibalized the existing smartphone market.
• 💡
  16:13

  Rapidly prototype and test with users to develop a solution to their problems and ensure the product experience is right.

  • Talk to customers to understand their pain and develop a solution to their problems through rapid prototyping and user testing.
  • Focus on quickly creating a functional prototype and testing it with users, rather than building a fully functional product to figure out if it will work.
  • Focus on making sure the product experience is right and build a team that can quickly iterate, test solutions with customers, and don't overthink it.
  • Interview 5-10 customers to understand their motivations, pain points, and experiences, run 3-5 UX testing sessions, and track metrics carefully to avoid drawing false conclusions.
  • Encourage users to give open and honest feedback while performing a task without any help from you to identify critical UX bugs.
  • Adding a gratuitous field to a signup form that said "Your Name" helped people recognize it as a signup form, which was discovered through UX testing.
• 🚀
  26:21

  Launch when your product is better than the competition and track NPS, returning usage, and renewal rates to measure product-market fit.

  • Launch when your product is better than what's out there and prioritize tasks that get you to the next milestone.
  • Optimize for learning by asking yourself what is the biggest unknown and prioritize tasks accordingly.
  • Track returning usage, NPS, and paying customer renewal rates to determine product market fit.
  • Weebly had an NPS of 80%, which is above 50 and indicates good product market fit.
  • Look at the percentage of customers eligible to renew and what percentage of those customers actually renewed to get an accurate measure of customer retention.
  • When you have product-market fit, customers will come to you, but if you don't have it, it will feel like pushing a rock up a mountain.
• 🤔
  32:45

  As you scale, remember to stay focused on product-market fit, channel model fit, pricing, and building a brand to stay ahead of the competition.

  • When scaling your business, it may feel like you're a genius, but you'll eventually realize you're not as smart as you thought.
  • To be successful, a startup needs to have a better product than alternatives, acquire customers in a differentiated way that scales, and invent a business model that doesn't kill its attraction.
  • Product market fit, channel model fit, and pricing all need to work together to acquire customers.
  • Keep your team small (around 20 people) and don't scale until you have product market fit.
  • Once you've achieved product-market fit, scale aggressively and be aware of potential competitors.
  • Once you have product-market fit, aggressively scale your company and build a brand to gain advantages in the market.
• 🚀
  39:00

  Entrepreneurs are optimistic risk-takers who create a platform horizontally and customize it for verticals to build a successful brand and market.

  • Virgin America's brand was built on the insight that the experience of flying sucks, and they created an airline to make it better.
  • Investing in the flying experience, such as staff attitude and PR events, is the basis for a successful brand.
  • Entrepreneurs are optimistic risk-takers who don't give up and have confidence in their product.
  • Building a platform horizontally and customizing it for verticals is a successful strategy for creating a market.
  • We spent the first four years convincing people that building a website was possible without coding knowledge.
  • Once people try a product and enjoy the experience, word gets around and the market is created, leading to different problems of scaling and refinement.
• 💰
  46:15

  We went from not charging money to actively trying to make money, and eventually became cashflow positive in January 2009 by focusing on customers and doing one job better than anyone else.

  • We went from not charging money to actively trying to make money in January 2008 due to the belief that making money was better than raising another round.
  • We launched Weebly Pro in June 2008 and after a week of sales, we made 10 times less than the lowest bet, but kept iterating and became cashflow positive in January 2009.
  • Educate purchasers and users on the benefits of transitioning to a new product to make the transition smooth.
  • Most companies need to reach the early traction phase before they can raise money, but everyone solves the chicken-and-egg problem of getting to early traction without raising money differently.
  • Focus on customers, not competitors, and don't look at your product in terms of a feature grid, as you can never win and always be behind.
  • Your product should do one job better than anyone else to stand out.