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The definition of product-market fit indicates that it is about strong market demand, so it would seem that the tsunami of demand is required. That does not me

The definition of product-market fit indicates that it is about strong market demand, so it would seem that the tsunami of demand is required. That does not mean a successful business requires product-market fit. Weak market demand can still provide a great business and strong market demand is not a guarantee of business success. One can always play the game of semantics, of course.

ghaff 5y ago
It sounds like semantics to me. If I start a company that makes a $100K machine that genuinely increases efficiency/saves money/etc. in some industry used to buying expensive machines, I might reasonably hope to create a successful business. I would less reasonably hope to be able to sit back and watch the tsunami of demand roll in.
- rileymat2 5y ago
  It would also apply to government RFP processes.
- randomdata 5y ago
  And when you have products like that you don't necessarily need strong demand. A small handful of dedicated clients willing to spend incredible amounts of money due to you controlling the supply can create a very successful business. In fact, the article talks about such businesses. Looking to achieve product-market fit is particular to certain businesses (the kind Y Combinator likes to invest in) who are looking to expand to a wide audience, not necessarily something all businesses should be striving for.
  - danielmarkbruce 5y ago
    What you are describing with "small handful of clients willing to spend incredible amounts of money" is very strong product market fit. The market is just small.
    - randomdata 5y ago
      I am not sure I agree. Demand is weak. There are few customers and they buy rarely. It just so happens that there is also very little supply, so the price can be high and in those high prices a very successful business can be built. On the flip side, as a farmer, I have found what is essentially perfect market fit. Nearly every person on earth wants what I produce. The problem for my business is that the supply is also huge, so I can't charge much. Often I lose money. It's a living for me, but not the greatest business or something investors are going to be throwing money at.
      - danielmarkbruce 5y ago
        People buy cars rarely. Ferrari doesn't sell many cars. Ferrari has product market fit. The size of the market and the frequency of purchase are independent of product market fit. Farmers have great product market fit. They sell a commodity and have little/no pricing power and thus earn pretty low returns on capital. Product market fit is one thing. Market size is another. Frequency of purchase is another. Competitive advantage is another. Building a big successful business requires getting many things right, not just getting product market fit. The reason folks at YC (and others) harp on about product market fit is that they seem to see a lot of companies trying to grow before they have it - which is crazy. It doesn't mean product market fit is the only thing.
        randomdata 5y ago
        > People buy cars rarely. Ferrari doesn't sell many cars. Ferrari has product market fit. Not by the formal definition of having strong demand. The demand for Ferraris is weak, but the equally restricted supply allows Ferrari profitability anyway. The demand for food is exceptionally strong, but the vast supply makes profitability very difficult. > Product market fit is one thing. Market size is another. Frequency of purchase is another. Competitive advantage is another. They are separate things, but all come together to make up what we call demand. Product market fit hinges on demand, not those variables alone.
        5y ago

ghaff 5y ago

It sounds like semantics to me. If I start a company that makes a $100K machine that genuinely increases efficiency/saves money/etc. in some industry used to buying expensive machines, I might reasonably hope to create a successful business. I would less reasonably hope to be able to sit back and watch the tsunami of demand roll in.

rileymat2 5y ago
It would also apply to government RFP processes.
randomdata 5y ago
And when you have products like that you don't necessarily need strong demand. A small handful of dedicated clients willing to spend incredible amounts of money due to you controlling the supply can create a very successful business. In fact, the article talks about such businesses. Looking to achieve product-market fit is particular to certain businesses (the kind Y Combinator likes to invest in) who are looking to expand to a wide audience, not necessarily something all businesses should be striving for.
- danielmarkbruce 5y ago
  What you are describing with "small handful of clients willing to spend incredible amounts of money" is very strong product market fit. The market is just small.
  - randomdata 5y ago
    I am not sure I agree. Demand is weak. There are few customers and they buy rarely. It just so happens that there is also very little supply, so the price can be high and in those high prices a very successful business can be built. On the flip side, as a farmer, I have found what is essentially perfect market fit. Nearly every person on earth wants what I produce. The problem for my business is that the supply is also huge, so I can't charge much. Often I lose money. It's a living for me, but not the greatest business or something investors are going to be throwing money at.
    - danielmarkbruce 5y ago
      People buy cars rarely. Ferrari doesn't sell many cars. Ferrari has product market fit. The size of the market and the frequency of purchase are independent of product market fit. Farmers have great product market fit. They sell a commodity and have little/no pricing power and thus earn pretty low returns on capital. Product market fit is one thing. Market size is another. Frequency of purchase is another. Competitive advantage is another. Building a big successful business requires getting many things right, not just getting product market fit. The reason folks at YC (and others) harp on about product market fit is that they seem to see a lot of companies trying to grow before they have it - which is crazy. It doesn't mean product market fit is the only thing.
      - randomdata 5y ago
        > People buy cars rarely. Ferrari doesn't sell many cars. Ferrari has product market fit. Not by the formal definition of having strong demand. The demand for Ferraris is weak, but the equally restricted supply allows Ferrari profitability anyway. The demand for food is exceptionally strong, but the vast supply makes profitability very difficult. > Product market fit is one thing. Market size is another. Frequency of purchase is another. Competitive advantage is another. They are separate things, but all come together to make up what we call demand. Product market fit hinges on demand, not those variables alone.
        5y ago