What are your thoughts on the term that I am hearing in some of the podcasts (primary where one of the guest/organiser is a VC) - 'Founder market fit'. Is it really important/relevant/practical especially for aspiring entrepreneurs who have work experience (say 5-10 years)
Yes, for raising money and definitely yes if you're into B2B. I have been through a startup where I bootstrapped through building something in sales intelligence, and I had never done any enterprise sales nor any personal network in this space. Had a pretty tough time selling it through various channels, eventually had to drop that idea. Shifted to something else where I had enough experience of 5 years, and I was shocked to see the intuitiveness and efficiency of executing this startup, right from identifying problems to hiring to selling. Wouldn't recommend treading in unknown waters if you wanna optimize your chances of winning. I really admire the founders who build in new markets and still succeed. Do think about the right to win v/s want to win. It feels want to win would overpower everything else, but turns out life isn't that easy my friend.
Very well said !! Thank you. What could be some factors that help founders building in new domain increase their probability of success and compete with founders having domain experience
If you've experienced the problem first-hand and wanna create something better, you envision something far better than the existing one, simply build it out and ship it to your ICP in the personal network and get going. Don't really need to worry so much about defensibility etc. when starting off, these things are just for answering VCs, but yeah shouldn't be reinventing the wheel at the same time. Have a vision of how you want a different future for your ICP. To your question about building in a new domain, you need to grind really hard to get some unusual insights to build upon, might as well bring in a co-founder who has domain experience.
It is super important imo. If you don't have a contextual appreciation of a space it's difficult to weigh in and drive success. More relevant and critical for B2B than for B2C. A lot of B2C services are lived experiences as individuals and take limited SME understanding. eg You don't need to be a Vet to run a chain of Veterinary clinics.
I briefly worked with an org that had a very very successful B2C offering. Household name.
Founders (and the investors) had the brainwave to also build a near neighbourhood offering that was B2B. Invested a few tens of millions in it.
Disaster. No appreciation and understanding of the space, customer behaviour, buying process, the limited TAM, sales rhythm, importance of customer success, building references, etc. Their primary source was to learn on the fly from books - which is suboptimal. American models of business don't work in other geos.
The org churns their entire sales, product and engineering teams and codebase every 9-15 months. It's a clusterf**k.
All because there is no FMF and there is no willingness to listen to folks who've done this before.
Got it, do you think if founders lack fmf but have folks with relevant experience, then they can crack it. Or founder necessarily needs to understand the domain in and out themself
The former is most preferred. My limited experience is they don't let other people drive it.
It's a control thing.
Do you guys think founder market fit is as important as it's glorified?
Any examples or counter-examples of companies that went big without any founder background? I'll start
Razorpay
I'm the founder who "Left a ₹50L+ job. Raised $2M. Built something profitable. Shutting it down now." 👋🏼
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