Losing Product-Market Fit

One of the hot topics in startups is around product-market fit. Whether it’s how to know if you’ve achieved product-market fit or how product-market fit relates to raising money, there’s plenty of information available. Well, there’s another aspect of product-market fit that’s almost never talked about: losing it. Just because product-market fit is achieved, it doesn’t mean it’s going to stay.

Here are a few thoughts on losing product-market fit:

  • When churn rates increase, product-market fit is likely slipping away (if churn hits 3% per month, you don’t have a business)
  • When the sales team loses the majority of competitive deals, it’s a bad sign
  • When the growth rate of the business stalls at modest scale, it’s likely the customers’ needs have changed

Markets move quickly and many startups that had a good thing going for a while get passed by when the next wave of innovation comes through. Don’t assume that achieving product-market fit also means that it will be maintained.

What else? What are some more thoughts on losing product-market fit?

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