When bootstrappers are about to build something new, we ask this question:
"Will someone pay for this?"
And it's a good place to start! But it doesn't go deep enough.
We're not looking for "someone" or even "some people." In most cases, we're looking for hundreds or thousands of customers. Getting five customers immediately after launch is a good sign, but if you can't grow beyond that, you won't be able to build a sustainable business.
Likewise, we want people to be willing to pay now. We're not looking for someone to pay "eventually." For a SaaS to work, it needs a group of people who are highly motivated to start a subscription now and then keep paying every month. Netflix doesn't want you to become a customer next year; they want you as a customer now.
And finally, we want to attract customers without expending too much effort. It can't take too much time, money, and energy, to convince someone to pay.
In The Myth of the Niche Market, I used fishing as a metaphor for choosing the right market.
I quoted professional angler Tony Bishop who said:
80% of fish are caught by 20% of fishermen. How do they do this? They fish where the fish are most often.
Tony's advice can be broken down into these parts:
His emphasis is on the second part: "fish where the fish are most often." He spends most of this essay describing steps for determining where to find groups of fish:
Find the optimum environment, for the target species, and you will find the largest numbers of fish and the biggest fish.
I remember being surprised when I heard my friend Adam Wathan's launch story:
"I had 14 sales on the night before I officially launched."
Talk about anticipation! His audience was so eager for his product, that they figured out how to buy it before he'd even launched it.
So how did he do that?
The golden trout isn't easy to catch. This small fish lives 10,000 feet above sea level in California’s Sierra Nevada mountains. Just to get to these alpine lakes, you'll need to backpack or horseback in. And golden trout are elusive; many anglers make the 5-mile hike, only to be disappointed by not catching any.
Don't choose elusive customers like this!
I've written about this in the past, but generally, you want customers who are:
For his first product, Adam Wathan targeted PHP developers. He knew there were millions of them, and he'd seen how motivated they were to learn new skills.
He was also a passionate member of that group:
"I never set out to build an audience. I've just always enjoyed participating in the community and sharing what I know."
There's a viral video that shows a boat motoring down a river. Suddenly, hundreds of fish start jumping into their boat.*
To me, this is product-market fit feels like. Without you having to try too hard, customers should be showing up to buy your product.
Initially, you want to see some unprompted momentum.
This step is crucial because it will determine (relatively quickly) whether your market is viable.
Adam seemed surprised when I asked him if it was hard for him to connect with PHP programmers.
For me, Twitter was where all the programming discussions were happening. I started sharing quick practical tips, and I'd get a hundred retweets.
Many of the problems entrepreneurs face are related to targeting a niche where there aren't a lot of fish, or the fish aren't biting.
Choosing a sizeable market that's easy to reach is a big part of the battle. But you're still going to need to build something they want.
Entrepreneurs overthink this. They believe they need to be overly original.
Remember, if you show up in a spot with lots of fish, and they're hungry, they'll gladly eat your worms.
"Market, timing, and product – you need all three!" – Jordan Gal
For Adam, he showed up in a massive market of PHP programmers, who had money to spend on training, and were eager to learn about his topic: Refactoring to Collections.
Most recently he and Steve Schoger released a new book for the programming market called Refactoring UI. It received a tremendous response and sold thousands of copies.
Adam's experience proves that if a market is hungry for a solution, you don't have to work too hard to sell them on the benefits. They'll gladly buy what you have to sell.
When you ask people to buy, what momentum do you observe?
In this post, Derrick Reimer describes the response he got to Level, a product he'd been building for a year:
Derrick did the right thing: he looked for evidence of momentum. Specifically, he asked:
"What have you done in the past to solve this problem?"
When folks responded, "well, nothing," he realized that there was "a mismatch between their perceived interest and the action they were taking." In most cases, people's past behavior is a good indication of what they'll do in the future.
If you pull up to a fishing spot teeming with fish, and you've got the right bait, they should practically be jumping in your boat.
But if the fish aren't biting, it's likely you're in a lousy market or have the wrong product (or both).
Need help with your next steps?
PS: Before I get too much email about that viral video I shared: I realize that the fish jumping in the boat are Asian carp, an invasive species. They're not especially desirable for fishing (or eating), but the image was too powerful not to share!