Product-Market Fit
The degree to which a product satisfies strong market demand. Achieved when customers actively seek out and recommend the product, and growth becomes organic rather than forced.
Used in the Books
This term appears in 32 chapters:
"...rane Framework works best for companies at a specific inflection point. Check if you're ready: You're ready for membrane design if: - ✓ You have product-market fit (proven value proposition, repeatable customer acquisition) - ✓ You're growing (hiring 10-20+ people in next 12 months OR adding 50+ customers/month)..."
"... Groupon's expansion followed the cancer pattern: - No systematic market validation before entering new territories - Expansion into markets with no product-market fit (Japan, South Korea, and Europe had different local deal dynamics than Chicago) - Hiring binges without organizational capacity to integrate new peop..."
"...risk) - 50-60% Survival = Conservative growth (balanced, sustainable scaling) - 30-45% Survival = Moderate growth (Series A/B typical, proven product-market fit) - 15-25% Survival = Aggressive growth (Pacific Salmon, bet-the-company, high risk) - <15% Survival = Existential risk (company dies if growt..."
"...alue) Store 1.5-2× minimum = Survives scarcity with margin for unexpected costs, but doesn't hoard excessively Example: Startup A (pre-product-market fit, uncertain revenue): - Monthly burn: $150K - Scarcity duration: Need 12 months to reach PMF - Minimum reserves: $150K × 12 = $1.8M - Buffer multiplie..."
"...unway) - Restricted burn: $500K/month (20-month runway, 40% restriction) - Trade-off: Grow slower (hire 20 instead of 40), but 8 extra months to find product-market fit Framework 2: Periodic Fasting vs. Continuous Restriction Question: Should you restrict always (continuous), or alternate between restrictio..."
And 27 more chapters...
Biological Context
Product-market fit parallels ecological niche fit—finding the environmental conditions where an organism thrives. Like organisms adapted to specific niches, products must match specific customer needs. Poor fit means struggling to survive; good fit means thriving with less effort.
Business Application
Marc Andreessen: 'You can always feel when product-market fit isn't happening... and you can always feel product-market fit when it's happening.' Signs include organic growth, customer enthusiasm, and retention without heavy intervention.