S2E16 – How to achieve Product Market Fit? With Andy Karuza

Achieving Product-Market Fit is a pivotal milestone for any business, ensuring that your product seamlessly meets the demands of your target audience. Discover the essential steps to achieve Product-Market Fit with our comprehensive guide. From market research and identifying customer pain points to refining your value proposition, we provide actionable insights to align your product with market needs. Learn effective strategies for customer feedback loops, rapid iteration, and leveraging analytics to fine-tune your offering. Our expert tips will guide you through the process, helping startups and established businesses alike to navigate the competitive landscape and position their products for success. Explore the path to sustainable growth by mastering Product-Market Fit with our in-depth resources and strategies. Elevate your business to new heights – start optimizing your approach today!

In today’s episode on the Grow Your B2B Podcast, we dive deep into the critical milestone of achieving product-market fit. Joining us is Andy Karuza, the marketing lead at Nacho, a seasoned startup investor, advisor, and serial entrepreneur. Andy shares his wealth of experiences, failures, and successes, offering invaluable insights into the journey of finding product-market fit.

Achieving product-market fit is the bedrock of sustainable growth for any SaaS company. Andy Karuza’s journey and insights provide a roadmap for entrepreneurs to navigate the challenges and make informed decisions on their path to success. Remember, it’s not just about selling a product; it’s about solving a problem and creating a product that customers love.

Episode Highlights:

Defining Product-Market Fit:

• Product-market fit is the point where a product or business can stand on its own.
• It goes beyond mere revenue and involves enthusiastic customer engagement and referrals.
• Key indicators include a high net promoter score and solving a problem 10 times more efficiently or affordably.

The Crucial Role of Product-Market Fit:

• Product-market fit is the fuel for scaling; without it, companies struggle to grow efficiently.
• Having product-market fit makes marketing and revenue generation significantly more effective.
• It is akin to having a well-fueled car ready to drive smoothly down the entrepreneurial road.

Targeting the Right Audience:

• Understanding the customer and their problem is crucial for effective product-market fit.
• Start by defining an ideal customer profile (ICP) and focus on solving the specific problems that matter to them.
• Avoid the common mistake of trying to be everything to everyone.

Common Mistakes and Misconceptions:

• Ego-centric views hinder understanding customers; it’s essential to step into their shoes.
• Mistaking revenue for product-market fit can lead to short-term success without sustainable growth.
• Knowing when to pivot is crucial—pay attention to customer feedback and data to identify friction points.

Strategies for Achieving Product-Market Fit:

• Begin with the customer, building a product that efficiently solves their core problem.
• Start small with a minimal viable product (MVP) and iterate based on customer feedback.
• Obsess over both quantitative and qualitative data, including customer interviews and demos.
• Embrace the “land and expand” approach; start with a niche and gradually broaden your market.

Frameworks and Methodologies:

• Keep it simple and relatable.
• Focus on efficiently solving customer problems with minimal friction.
• Avoid overthinking and reinventing the wheel; stick to the basics.

Challenges in Achieving Product-Market Fit:

• Common challenges include the difficulty of knowing when to pivot.
• Love your customer and focus on solving their problem rather than just promoting your product.
• Importance of product positioning and storytelling.

Listening to Customer Feedback:

• Example of adjusting product design based on customer feedback.
• Small changes can have a profound impact on product success.
• Emphasizes the significance of product positioning and storytelling.

Dealing with Lack of Resources:

• Look for good co-founders, especially if there’s a skill gap.
• Consider outsourcing to engineering firms for MVP development.
• Strategies like partner-led growth for marketing without significant costs.

Scaling Strategies:

• Partner-led growth and product-led growth can be effective.
• Identifying and doubling down on effective marketing channels.
• Experimenting with new approaches while scaling.

Nacho’s Journey to Product-Market Fit:

• Nacho has a strong product-market fit, especially on the seller side.
• Ongoing initiatives to reduce friction for buyers and introduce a marketplace for service providers.
• AI-powered tools to enhance the shopping experience.

Scaling from Zero to 10K MRR:

• Emphasizes the importance of defining product-market fit.
• Building a solid foundation by identifying processes that work.
• Celebrating small wins and creating a positive culture.

Scaling from 10K MRR to 10 Million ARR:

• Transition to scaling and creating scalable models.
• Double down on processes that work.
• Continual experimentation and exploration of new marketing channels.

Advice for SaaS Entrepreneurs:

• Don’t be afraid to fail; failure is a part of the learning process.
• Celebrate small wins and appreciate the journey.
• Listen more, focus on solving customer problems, and avoid an egocentric approach.

One Thing Wished Known 10 Years Ago:

• The importance of listening more and being attuned to customer needs.
• Reflects on the value of learning from failures and continuous improvement.
• Learning comes from experiencing and feeling.
• Trial by fire is an essential aspect of entrepreneurial growth.

Key Timecodes

• (0:29) Show and guest intro
• (1:12 ) Why you should listen to Andy Karuza
• (3:38) What is product market fit? 
• (4:35) Why is product market fit so crucial for startups?
• (6:29)  How to determine your ideal customer profile(ICP)
• (7:58) Common mistakes or misconceptions companies have while trying to achieve product market fit.
• (10:00) The right timing to pivot? 
• (11:10) Andy’s ideal product market fit process
• (14:46) Andy’s frameworks or methodologies 
• (15:38) The common challenges companies face while implementing product market fit?
• (22:42) How Andy is trying to achieve product market fit for Nacho at the moment? 
• (24:25) How to grow towards 10K MRR
• (25:32) How to grow towards 10 million ARR
• (27:30) Andy’s crucial advice to SaaS founders
• (30:09) What Andy wishes he knew 10yrs ago 

Transcription

[00:00:00.000] – Intro

Welcome to Growing a B2B SaaS. On this show, you’ll get actionable and usable advice. You’ll hear about all aspects of growing a business to a business software company, customer success, sales, funding, bootstrapping, exits, scaling, everything you need to know about growing a startup, and you’ll get it from someone who’s going through the same journey. Now your host, Joran Hofman.

[00:00:27.880] – Joran

Welcome back to the Grow Your B2B SaaS Podcast, where we discuss all topics on how to grow your B2B SaaS no matter in which stage you’re in. The path to success in the SaaS world isn’t just about having a standard product or team. It’s about ensuring that product resonates with the right market. This alignment, often termed as product-market fit’, is going to be a pivotal milestone for any size company. That’s what we’re going to talk about today, how to achieve product-market fit. My guest today is Andy Karuza. Andy is the marketing lead at Nacho. He’s a startup investor, advisor, and serial entrepreneur. Next to this, he also contributed to 100-plus business and marketing publications. Without further ado, welcome to the show, Andy.

[00:01:10.870] – Andy

Hey, Joran, thanks for having me on today.

[00:01:12.500] – Joran

I always like to ask this question at the beginning. It’s a really typical Dutch blunt question. Why should people listen to you today, Andy?

[00:01:19.530] – Andy

Well, I’ve been through a lot of experiences. I’ve failed in some ways, so you don’t have to. You can take my advice on some of the wins and successes I’ve had. I’ve been in the agency world. Back in the day, I used to have a lot of marketing agency. I got the great experience to work with a lot of startups from the ground up. I also got to work with a lot of really large organizations as a marketing consultant coming in with new innovative strategies like Google, Microsoft, BMC software, Amazon, a lot of big brands there. From that, it gave me a lot of perspective into how large-scaled companies are really successful and the processes that they use to really grow their business and ensure their success. Then from the startup side, working with a lot of entrepreneurs from the ground up, just helping them achieve product-market fit and get that early traction for their company. Then I realized as a marketer, a lot of times instead of trying to sell other people’s products, I realized that a lot of times people built something but they didn’t really have product-market fit and they were just going out there trying to sell whatever they had.

[00:02:13.840] – Andy

That got me to more the product side where my belief is that marketing really starts with the product. It starts with the experience that you’re building around the product and the problem that you’re solving for the customer. It’s really important to understand what you’re building from a marketing angle because if you know your customer and the problem that you’re trying to solve, it makes it a lot easier to build a product that really helps serve that customer. Then it just really comes down to how you communicate it. Really, over the last 10 years, I’ve done a lot of products, a lot of software companies that I’ve founded myself. Some have won, some have lost. Today, I took this job with Nacha because to me, I believe it as the Amazon of SaaS, if you will. I had big vision here. For me, it was a really entrepreneurial role where I could come in and lead the marketing and work with a lot of great founders around the world. With my experience, I helped them find success as well and just be a part of their journey. For me, it’s like being a part of hundreds or thousands of startups.

[00:03:06.050] – Andy

It’s pretty exciting.

[00:03:07.570] – Joran

I see. You can walk-to-walk or talk-to-talk, how you say it, because you’ve already been in that position yourself as well.

[00:03:14.170] – Andy

Yeah, totally. Those experiences really help give you that gut instinct to know when to avoid things. And that first hand knowledge is really critical for being in the space and finding success with any SaaS product.

[00:03:24.800] – Joran

Nice. As you say in that you looked in a lot of kitchens from SaaS company because you worked at so many different companies and advice as well. You already explained it a little bit product-market fit. I do start with the real basic questions at the beginning. How would you define product-market fit for somebody who’s unfamiliar with the concept?

[00:03:42.720] – Andy

I think product-market fit is really a point to where a product or a business can really stand on its own. You’re not trying to force it through sale by sale. Although you can build companies brick by brick, I believe real product-market fit is when you get those water-to-mouth referrals and you’ve created such a great product experience, you’re solving an important problem for customers where you’re either 10Xing the efficiency of solving that problem over other alternatives or it’s 10 times more affordable. In either case, when you have product-market fit, when your customers are really excited about your product, they’re highly engaged with your product, they use it on a regular basis, whatever your KPIs are around that. But most importantly, you have a high net promoter score, meaning they recommend your product actively to other people within your ICP. And that’s when things really scale quite nicely and efficiently as a business model.

[00:04:31.060] – Joran

Yeah, and that’s why we love it, really, there’s people recommending other people’s software. Where we say the product market fit, like PMF, you can already say it, what it is, what happens when you have it. But why is it so crucial? Everybody talks about it, product market fit. We need to reach product market fit. Why is it so crucial for startups to get to that point?

[00:04:49.190] – Andy

It’s like getting in your car to drive somewhere and you don’t have any gas in it. You got to have everything. Just check your lights, check your tires, make sure that you have gas in your car. So when you move, you could really start moving. So why product-market fit is so crucial is that your company is really not going to scale very easily, if at all, if you don’t really have product-market fit. Because trying to force something on your customers or try to oversell something, it’s really tough dynamic, right? If people want to buy, they don’t want to be sold. So if you have product-market fit, it means promoting your product and actually getting it out there and generating revenue and building a business around it becomes so much easier. And so a lot of people, the biggest problem I see is they want to rush something out and start selling it. But if you go back to the basics and you really solve the product-market fit and you ensure that you have the right MVP and it’s as good as you could possibly be, it makes everything you do after that so much more efficient.

[00:05:41.150] – Andy

Every ad dollar you spend is going to have a much higher conversion rate and a return on ad spend. Every email that you send to somebody pitching your product is going to have a much higher conversion rate, leading to more customers and more partnerships. So everything falls online quite nicely once you have that product-market fit.

[00:05:57.540] – Joran

Yeah, and I think staying with the car example you gave, like you’re going to start with a broken car or a car without any gas. I think once you reach it, it’s almost like driving down the hill. You will need to make some turns and you probably make some mistakes, but things are going to go a lot faster as well.

[00:06:12.320] – Andy

Yeah, certainly. Yeah, and you got the momentum and gas to get there, so wherever you need to go.

[00:06:17.850] – Joran

Exactly. That’s the last reference I will make. But you need to put in the right gas, right? As in with any SaaS company, you need to get in the right clients. As in ICP, ideal customer profile, especially at the beginning. How do you determine the right target audience or market segment to focus on initially? Because I think that’s also a big problem where people misalign a product with the market they’re going after for.

[00:06:42.070] – Andy

Yeah, that’s a big problem that I see too. A lot of times they see founders and product marketers that think they’re solving a problem, but they’re looking at it through their lens, from their perception. But I believe that it really goes back to the customer. So know your customer really well, really understand the problem and why it’s such a big problem for them. Then you can really determine how you can really effectively go about helping these people solve that problem. When you understand the customer and the problem that they have, it makes it a lot easier to identify these people and really specify down to the exact person that’s the best fit for you initially. And a big problem I see with a lot of people, especially when it’s what their go-to-market, is that they try to be all things to all people. And that’s really not a good strategy, especially initially. So if you look at Amazon, it started as a bookstore, but obviously you could expand from there. And if you could sell books online, you could sell other things online too. So it’s really important that you establish a beachhead with the exact customer that really cares about the problem we’re solving.

[00:07:38.260] – Andy

Then you can worry about how do you build new channels and revenue streams after that, maybe tackle a new ICP, if you will. But that’s where I’d start. Just go back to the customer, understand the problem really effectively, and then you can start to build everything else around that.

[00:07:53.280] – Joran

And I think that this ties really well in my next question, as in mentioned a couple already. What are the most common mistakes or misconceptions companies have while trying to achieve product-market fit? I think you already mentioned looking from SaaS-protective, not having a clear focus on the beginning, and not understanding your ICP. Any other things, mistakes, misconceptions companies have?

[00:08:15.300] – Andy

Yeah, I just want to reiterate the egocentric view that we have not only just as product marketers, everybody in life, really. It’s really important that we put ourselves in other people’s shoes. And if we can understand other people’s problems, we could better identify how to help them. And that’s what really entrepreneurship is about. Just to reiterate the point that we have to stop thinking about things in an egocentric way, we’re here to help other people at the end of the day. So that’s one of the common mistakes there. I also see a failure to pivot a lot of times. I also see sometimes when people pivot too early as well. So you should really know if you’re getting close to product-market fit, sometimes you got to stay true to the course and you got to know that you’re almost there. And you have to be able to really identify that. Alternatively, you have to know when to pivot to. A lot of people have this fallacy where they’ve gone so far in one direction, especially when it comes to building technology and they feel like they’ve invested so much into something that it makes it psychologically really hard for a founder to pivot, maybe in a direction that’s going to be better for his company.

[00:09:13.900] – Andy

You can’t be afraid to pivot if it’s necessary for your company. The other problem I see, too, is mistaking revenue with product-market fit. Sometimes having some revenue is great, but it doesn’t necessarily define that you have a scalable business model. So don’t be falsely convinced with having some revenue coming in and thinking that you have a business model and that you have true product-market fit. So product-market fit, going back to that point, is something where you have a high net promoter score, you’re getting customer referrals from other people, and business models built the skills. Don’t get distracted with short-term revenue and lose sight of the vision.

[00:09:46.820] – Joran

I think the first point you mentioned about failure to pivot and pivot too early, I think that’s really contradictory. What advice would you give? You already mentioned if you’re so well invested in your company, it’s hard to see it yourself. What advice would you give for companies to see when is the right time to actually pivot?

[00:10:05.820] – Andy

If you keep coming up against a lot of friction is the keyword I’d probably like to say. And friction is something you can see in your data. It could be something where you have a very low conversion rate. And so if you follow your data, you could see that visually qualitatively too, just hearing the same feedback from customers. That’s very underrated actually. So even if it’s not negative feedback and people are specifically telling you what’s wrong with your product or your business, if they ask the same question over and over again and those questions come up consistently with customers, there’s something there. And so that warrants diving deeper into it to figure out, is there a misalignment with your product and your product market fit? Or maybe it’s a product positioning issue. Maybe you’re just not messaging your product the right way. But if you listen to those questions and identify a trend there, you could start to dive into it and get to the core root of the problem, and then you could work backwards from there to solve it.

[00:10:59.620] – Joran

Yeah, I think it’s best practice overall to keep talking to your clients and to figure out what their challenges are and try to help them fix them. As you mentioned, then you will have people start referring you as well. This is an easy question, probably a tough answer. Can you walk us through some processes or strategic way you would recommend SaaS companies to get product market fit? Like any processes or things you would recommend here?

[00:11:25.540] – Andy

First, I would recommend, like I mentioned before, start with the customer. Really get to know your customer. Everything from there falls in line afterwards. If you really understand who your customer is and the problem that you’re solving for them, you could build a better product to more efficiently or more effectively solve that problem for them. So always start there. Then start small. Start with an MVP, a minimal viable product. A lot of people when they’re building a product go out there and they build too many features under maybe the wrong assumptions and they end up building this monstrosity of a bunch of features that don’t really end up actually solving the core problem for the customer. But if you start with an MVP, you can start with very limited feature sets, just really trying to focus in on solving the exact problem for that exact customer in the most effective way possible. That’s how you can achieve product-market fit without spending a bunch of money on it or going too far in the wrong direction and having too much invested and maybe coming into the sunk cost fallacy. You don’t know what to rip out or take out and then go back on to reach your pivoting point.

[00:12:23.700] – Andy

So start small from there. Get customer feedback early and often and through the entire life of your company, always be listening to your customers and getting feedback on how you can improve everything. But especially very early on, build the product with your customer’s feedback. Get obsessed with data. Pay attention not only just to the numbers and what the numbers will tell you, but also look at qualitative feedback. Like I mentioned prior, the questions that keep coming up with customers, they’ll tell you a lot behind that story there. You should definitely tune into that and listen. Even small things, if you’re doing an interview with a customer or a demo, changes in their tone of voice. Infections in their voice can tell you a lot too. You introduce a feature and they say, Oh, or if you’re trying to explain your product too much and their eyes start rolling to the back of their head, you’re like, Maybe my pitch is bad. Really pay attention to people’s feedback, even the stuff that’s not in the data, and sometimes they’re not even what they verbally say. And like I mentioned too, is land and expand. Don’t be afraid to start small.

[00:13:20.990] – Andy

Amazon wasn’t built in a day. It started with books like I mentioned, and you could always expand outwards from there and build your online marketplace to sell all types of things and eventually take over the world.

[00:13:29.840] – Joran

Nice. I will summarize it for people. I can start with the customer, build your ICP, start with an MVP, which solves the core problem. Get customer feedback, get obsessed with data, and then land and expand. I think the core here is that you need to build a product which people actually want to use. They want to solve a certain problem. So of course, it sounds easy, but I think a lot of people as well start a company with the wrong reasons as in they want to make as much money as possible. But if you actually do it from the approaches and you want to solve a problem, things will follow as well.

[00:14:03.630] – Andy

Yeah, certainly.

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[00:14:45.530] – Joran

Are there any frameworks or methodologies you would recommend people to check out and use?

[00:14:51.890] – Andy

Frameworks, like I mentioned, I like to keep things simple and keep it relatable to everybody. Some people might have some fancy stuff they read about in a book or some Harvard Review thing, but really just comes down to we’re in the business of helping people and helping people solve their problems. The way that you do that in the most efficient way possible, truly caring about the customer’s problem while keeping your business with this little friction and as simple as possible to really help those people solve that problem. If you think about it, it’s really basic stuff that you don’t have to reinvent the wheel or overthink it. It just all goes back down to the basics.

[00:15:24.330] – Joran

Yeah, I fully agree. There’s no magic bullet. It’s back to the basics and in the end it is going to be hard work to get there. But once you get there, it’s going to be a nice experience. Before you get there, you’re definitely going to have a lot of challenges. What are some of the common challenges company face? I think you already mentioned one, not knowing when to pivot. Any other challenges you’re going to face when trying to achieve product.

[00:15:47.640] – Andy

Market fit? Yeah, technology is easy, I always say. People are hard. Really love your customer, love the problem that you’re solving. Not your product and your features so much. Those are just tools to help the customer solve their problem. If they like what you offer, then you have a business and it’s going to grow. So really change your perception to focus on helping people, actually. And this is one thing I’ve learned the hard way myself too, right? I had a product where I just wanted, I invented these smart backup cameras and this thing was like a brick on the back of people’s cars. And everybody was like, I don’t want this ugly-looking thing on the back of my car. I already have a license plate frame there. And to give you an example, this was me listening to feedback. I kept on hearing license plate frame already have something back there. So for me, that gave me the cue, right? Nobody necessarily explicitly told me to design it like a license plate frame, a smart one. But we changed the design form of it, and that’s when the product became very successful and popular, actually.

[00:16:41.870] – Andy

So when we promoted it as a smart license plate frame to replace your old one, but this one has a cool camera built in that communicates to a mobile app on your smartphone. People loved it. It was in the media, did a lot of TV stuff for it, and now very successful. But before, just because of the design form, people just didn’t care about it. So small changes like that, and I won’t even call it a full pivot, really, but it could have a profound effect. But that comes down to loving the customer and really listening to what their needs are. Even if it sounds like a minute detail, oh, I have to design it a little bit differently. But nonetheless, it’s very important. That product positioning is very important too. So sometimes you might have a great product, a lot of times you might even know who your customer is, but you’re not telling the right story. So this is something that you could definitely A/B test with advertising a lot of times. So don’t be afraid to run ads, see which ones get a higher performance right there to test your copy and messaging.

[00:17:32.760] – Andy

But product positioning, once you have a good product and you have a really good idea of who your customer is and how you solve their problem, you got to get really good at that storytelling angle there. Some other challenges, too, for companies is that you don’t have a reputation when you’re getting started. It’s very hard to get traction going. You’re the new guy on the block, people haven’t heard of your company, so do whatever you can to maybe partner with bigger companies, put some logos on your site. Pr can be really effective as well, too. Just say, Forbes or some company writes about that, definitely tout that on your website. That gives you more credibility. And just at the very early stage, just winning one customer at a time just really goes a long way too. Just having actual paying customers that love your product, that gives you a base to start to build a reputation on. We also deal with a lot of lack of resources too. A lot of people realize that they don’t have maybe the engineering talent to pull it off. Maybe look for a good technical co-founder if you’re more of a marketing guy.

[00:18:27.550] – Andy

If you’re an engineering person, get a good marketer because a lot of times what you want to build as an engineer, A plus B equals C, doesn’t necessarily translate in the real world because we’re dealing with people here, not machines. Find a good co-founder to get started. If you don’t have the resources in terms of funding, there’s a lot of engineering firms that you could outsource to build your MVP. For my product, the Fence has actually outsourced to an R&D firm and helped manage the project with them to build it. But that allowed me to achieve a minimal viable product early on, which I was able to raise money around. But I didn’t have to spend too much money to bring this product to market and achieve that product market fit initially. Lastly, you might not have a lot of money to spend on marketing to really get your business out there and grow, but that’s where strategies like partner-led growth comes in to be really effective. Identifying partners like yourself to notch in the way that we work together. We’re in collaborations where we do content marketing together. We promote you in our marketplace and vice versa, where we’re really just overlapping each other’s audiences.

[00:19:22.350] – Andy

It’s free. We’re just putting in our time and putting in our shared reputations and collaborating with our communities. But it helps both businesses there. A lot of companies I definitely recommend should do partner-led growth. If you’re building a product, the other PLG words, so product-led growth, to build a product that’s viral by nature that is easy to use, frictionless, and solves that customer problem really well. Then it’s got those viral features built into it where it’s easy to like for people to invite other friends to it naturally. Little viral loop tactics like that can go a long way to scale your product with little to no money actually.

[00:19:56.290] – Joran

Yeah, in the end, it will be tough, but once that kicks in, that’s going to be really nice and I think what you mentioned, partner and let’s grow, the biggest thing is we’re going to tap into each other’s network. We’re both growing our own network. But in the end, just by talking to each other and helping each other out, you’re going to get exposure to my network, I’m going to get exposure to your network, which is really nice. That’s only one example. If you have 10 people or 20 people or 50 people, that’s going to be a real boost for getting that feedback and getting the first customers in as well. Absolutely. I think the other thing I wanted to mention, like you mentioned with the keeping the cost low or putting development outsource, like nowadays you have so many no-co tools, so you can get the MVP up and running quickly. Or what you could do, which something we have done is to give out equity towards the technical co-founder. So instead of working for salary, work for equity, which is a nice one as well.

[00:20:48.230] – Andy

That’s a great point actually because there’s a lot of engineers out there and technical partners that might… Sure, these big companies throw a lot of money at them, but a lot of these guys get tired of being in the big corporate world. Eventually, they want to venture out and do their own thing, right? So it’s hard being in a big company, feeling like you’re a cog in the wheel. And I’ve seen this a lot, right? So you could get really extremely talented people that want to join you on your startup, even if it’s part-time to get things going. But they really believe in your product vision and the problem that you’re solving, you’d be surprised you can get some good partners on your team fairly effectively because a lot of these guys just money can only go so far for motivation, right? A lot of times people want to paint their own masterpiece, if you will. Keep an eye out for people like that that are tired and bored of the corporate life.

[00:21:30.680] – Joran

Yeah, and I think you touch upon a really good point, like creating your masterpiece. What I noticed internally, as in we’ve built the app completely, we built the app completely in the last nine months, and then they basically were able to create the app how they want it in the code, how they want it, and to shape it as a masterpiece of them, where they’re really happy about the foundation of our app? If you have a senior developer who’s working a big corporation, they’re just changing a window, or might even just a glass. In our case, we’re rebuilding the entire foundation exactly the way they like it and how they envision it in the future. So I think that could also be a selling point towards a technical co-founder, as in they could actually build their own masterpiece, as you.

[00:22:10.690] – Andy

Called it. Yeah, because a lot of people like being able to tell the story that I built this thing. We took this thing from zero to one. It’s part of your story, right? As opposed to telling people that you meet, Oh, yeah, I did the edit button on Facebook. Com or whatever. I’m the edit button guy. That’s what I do every day. Just make sure the edit button is live. And I’ve seen rules like that in large companies. I’m blown away with how limited their role is. For some people, there’s only so long that they can do that for even if the money is good.

[00:22:40.500] – Joran

Exactly. You know what? We want to have a purpose as well. When we go back to product-market fit and go back to Nache, tell me a little bit how are you trying to achieve product-market fit for Natcho at.

[00:22:49.520] – Andy

The moment? Yeah, so with Nache, we have a pretty good product-market fit, especially on the seller side. We do have a lot of buyer side interests as well too. One thing that we’re working on now is on the buyer side, making it easier, reducing friction and making it easier for people to take advantage of the offers that we have in the marketplace. That’s one of the big initiatives that we’re working on now. We’re also adding a Maven’s marketplace for service providers too. We did see a lot of demand for agencies of all types and companies to actually attract the customer base as well too. There’s not a lot of options out there for them. We’re pretty excited about the potential growth in that area too. But for us, it just comes down to finetuning the product, just finetuning the shopping experience, making it easier for people to not only find the software that they’re looking for or maybe better alternatives to what they have now that might be able to do the same thing more affordably or might even have better features. For that, we built in some AI-powered tools that uses your software usage habits and buyer behavior to help you identify software that might be more relevant for you.

[00:23:47.640] – Andy

And just little things to just reduce friction overall just to make it easier for people to find the right product and get that product onboarded and successfully implemented within their organization.

[00:23:57.080] – Joran

Yeah. What you’ve said there is you’re trying to get people towards value, even though they don’t know yet, I guess, what that value is because they’re already using a product, but you’re already recommending them to use something else based on their behavior, which is, I think, really clever.

[00:24:10.530] – Andy

Yeah. A lot of exciting initiatives there, both short term and long term to further develop the product out and provide a better experience ultimately.

[00:24:17.490] – Joran

Nice. We’re going to go to the final four. When we talk about product market fit, and we’re going to cut it up into two stages, what advice would you have for SaaS founders who are trying to grow from zero to 10K Monday return review?

[00:24:31.810] – Andy

I like this stage a lot because this is where a lot of the problem-solving actually happens. This is where identifying the right customer, really fine-tuning your product market fit, and building that MVP out become really crucial. Because everything after that is, in my opinion, becomes a lot easier. But going from zero to 10k is probably the hardest point of any business. That’s why it’s really important to go back to the basics like I mentioned. This is the stage where you really have to identify product-market fit, and you have to get it because it’s going to make everything else you do afterwards so much easier and more effective to scale the business from there on out. So talk to your customers, get that feedback, get very granular, build everything brick by brick, customer by customer, and get right down to the problem and solve it most effectively and simply as you possibly can for the customer.

[00:25:18.290] – Joran

Yeah, and the better you build the bricks, the easier it’s going to get for the next question.

[00:25:22.320] – Andy

A great foundation you can build a huge building on top of that. A shaky foundation falls over.

[00:25:27.710] – Joran

Exactly. When we are going to post that stage, we’re now past 10K MR. What advice would you give a SaaS founder growing towards 10 million ARR?

[00:25:36.250] – Andy

This is where scale and process has become really important. So if you’ve actually defined your product-market fit, actually, one thing. So you might even have 10K an MR and an ARR. But like I mentioned earlier, don’t assume that revenue means that you have your business model. So step number one would be, okay, we have some revenue coming in. Are we ready to actually scale? And can these processes really scale out our business? Or this is the point to where you have to really make that decision to pivot your company. So first, really know that you have product-market fit and just make sure that you have that dialed in. So if you have that, then you’re ready to scale your business. You’ve defined hopefully some processes that work for how you treat your customers, how you onboard your customers, maybe the marketing channels that are really working for you. There’s a great book that I read several years ago by the founder of DuckDuckGo, I think. It’s called Traction. Basically, it identifies 19 different traction channels. There’s more now, but where you could actually get your customers. For every business, it’s not going to be the same traction channels each and every time.

[00:26:36.820] – Andy

Sometimes founders walk into it with a bias that they think what worked in their previous company is going to work in this company. Look at everything from a clean slate and don’t be afraid to try new marketing channels to experiment and grow. But if you identified processes that really work to scale your business, double down on those. If you found a particular marketing channel, maybe it’s product-partner-led growth, really double down on developing more partnerships because that’ll build that foundation that really helps scale your business. I would say at this stage, you’re building a scalable model and defining processes that you could scale with will really help you get to that 10 million ARR. But don’t be afraid to try new things. Always be experimenting there because you might discover a better way of doing things or maybe a new marketing channel that you might not have thought of before that actually ends up becoming pretty lucrative for your revenue growth.

[00:27:23.630] – Joran

Yeah, I think this is really solid advice. Get the good foundation in and then start scaling and creating processes to basically. What advice or encouragement would you have to SaaS entrepreneurs out there which are now on their journey to achieve product-market fit?

[00:27:39.390] – Andy

I always like to say don’t be afraid to fail. The people that don’t try don’t fail and they never learn anything. There’s something different between reading about something in a book and actually applying it in the real world and seeing how it works and getting a feel for it more importantly. Celebrate the small wins. That goes a long way, I think, for a lot of founders. It’s really tough to get your product out there initially, especially as an entrepreneur. Don’t look at it as a one-time thing, look at it as a career. You’re not going to be the best football player in high school, but if you keep training at it and you keep working on your throes, you’re going to become a much better quarterback and can eventually find more success there. The same thing with entrepreneurship. Don’t assume your first product is going to be ultra-successful. You’re going to fail along the way, but learn from those lessons. It’s a great opportunity to do. I really think luck, when they say the overnight success guy, and I’ve seen a lot of these over the years, luck is when preparation meets opportunity. That preparation is those failures that you go through sometimes, which gives you those life lessons.

[00:28:35.700] – Andy

The next time around, you don’t make those bad decisions anymore and you just have that gut instinct and feel for how to build the right product and how to go to market. That’ll define your success. Where one night you do have those products or those companies that just blow up overnight and everybody says, How did this guy do it? It’s the overnight decade or two decades that this person put in as an entrepreneur career.

[00:28:56.840] – Joran

Yeah, exactly. You have to, as you mentioned, feel a lot and then one time it will hopefully kick off for yourself. Celebrate the small wins. I think it’s even one I always or not always, but often forget because you’re so caught up in the next step or the next thing you want to do. And I think also for yourself, but also for the team, celebrate those small wins and make it nice because it is going to be a career, as you mentioned. So make it an enjoyable one as well.

[00:29:22.330] – Andy

Yeah, it’s very rewarding. You walk into a lot of restaurants and you’ll see their first dollar bill from a customer up on the wall to tell that story. I think for your team, like getting your first customer is really important. Getting to maybe your first hundred customers is an important milestone. But definitely, encourage that as a cultural thing within your company to celebrate those small wins because the small wins get you towards that long term vision and success that you all want to realize. But if you can’t appreciate the small steps that you’re taking that are right in front of you, waiting for that overnight success or whatever, it’s going to be a long way to get there. Celebrate the small wins and appreciate those. And if you define that as a culture for a team too, they’re going to be more motivated and encouraged as well too, which is really important because it’s not easy in startups, right? And so you have to be able to roll with the punches. But celebrating those wins allows you to do that really easily.

[00:30:07.290] – Joran

Yeah, I fully agree here. Last question, what is one thing you wish you knew 10 years ago?

[00:30:13.540] – Andy

Wow, great question. I think always to listen more. As a marketing person and as a product person, I’m a lot better than I was. It’s something that you could always refine as a person, like just realize what you’re good at and what you’re not good at. I wish 10 years ago, you could have avoided some of the failures. Some of the failures actually liked because you learn so much from them. But I actually look pretty fondly on some of those. Actually, some pretty good, great stories came out of that too. But I think just listening to people more, trying to help actually focus on solving the problem for the customer and forgetting about your egocentric focus on your product and loving your product too much and trying to change the entire world to conform to what you’ve done, as opposed to trying to conform your product into the world and actually helping people solve their problems. That really just comes down to listening to people and being attuned to all that. I think I’m great at it now, but I could be excellent. We’re always working on improving on everything myself, and I definitely recommend everybody else too.

[00:31:06.510] – Andy

We’re never perfect, so just keep working on those soft and hard skills that you have.

[00:31:11.010] – Joran

Yeah, and you’re never going to be perfect because you always want to make mistakes, because otherwise you’re not learning, right? I think that’s probably always the best way to learn is to actually make the mistake. So you can listen a lot even to this podcast and you might then avoid the most common pitfalls we just discussed. For example, regarding product-market fit, but you will have to feel yourself as well because that’s the moment you’re really going to learn.

[00:31:32.450] – Andy

Just get out there and do it. Trial by fire.

[00:31:34.730] – Joran

Exactly. If people want to get in contact with you, how would be the best way to do it?

[00:31:38.870] – Andy

Yeah, just reach out to me on LinkedIn. Happy to chat with anybody, help any founder grow their business. I just love working within the SaaS community. So anybody that wants to partner with us, we’re very, very partner centric. We look for win-win relationships. Don’t be afraid to reach out. You can find me on LinkedIn, Andy Kruza. That’s K-A-R-U-Z-A. Happy to chat with anyone.

[00:31:58.230] – Joran

We’re definitely going to add the link to your LinkedIn profile. We’re also going to add the link towards the traction book, which you mentioned. And I guess for final closure, I would recommend reaching out to Andy because he will be able to help you also to grow your SaaS as well.

[00:32:11.850] – Andy

Definitely do so. Thanks, Joran.

[00:32:13.560] – Joran

Thanks for coming on the show, Andy, and see you soon again.

[00:32:17.120] – Andy

Absolutely. My pleasure.

[00:32:18.780] – Outro

You’ve been listening to Growing a B2B SaaS. Joran has been ahead of customer success before founding his own startup. He’s experiencing the same journey you are. We hope you’ve gotten some actionable advice from the show, and we hope you had fun along the way. We know we did. Make sure to like, rate, and review the podcast in the meantime. To find out more and to hook up with us on our social media sites, go to www. Getreditus. Com. See you next time on Growing a B2B Saas.