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Definition of Product Market Fit  

Defining terms correctly is not just helpful, it is fundamental to useful discussion. All too frequently, we throw terms like "MVP" or "Product Market Fit" around without really knowing what they mean. I think there is a lot to be learned from asking "What is ...?" about all sorts of terms we think we are familiar with.

Inevitably, the answer includes other words that require definition, and their definitions in turn pose more questions. It's turtles all the way down, but the process of sounding out these foundations of our thinking processes is full of learning.

Marty Cagan of the Silicon Valley Product Group, in this fairly theoretical article, attempts to define terms like MVP (this definition is worth a read too - Marty proposes a less misleading term: "MVP Test"), and, in this article, Product Market Fit:

We create MVP Tests (typically measured in days) in order to discover our way to Product Market Fit (usually takes months). We continue to evolve the product from this Product Market Fit state all the way to achieving the Product Vision (typically 2-5 years).

Product Market Fit is a milestone, then, arbitrarily defining an early stage of success or maturity for the business.

Marty then proposes several definitions depending on the business context. I would suggest another one:

Product Market Fit is achieved when you stop needing to ask yourself whether you've reached Product Market Fit. When you're there, you tend to know it, because you're too busy dealing with the consequences of Product Market Fit (incoming sales, customer demand, user growth, etc) to worry about abstract questions like "have I reached product market fit?"

More from the library:
How to work as a CEO/COO team
How to develop disruptive ideas
On being an early startup employee