Recently I was talking with some entrepreneurs and the topic of second products came up. Here, a second product would be an additional product offering that’s a true, standalone product and not an add-on to the original product. Without missing a beat, everyone went around and said that every second product they launched failed.
I’ve been there. I’ve tried launching a second product multiple times and they all failed. Why?
Here are a few thoughts:
- Lack of Product/Market Fit – Inevitably, a new product doesn’t accurately meet the needs of the customers. Even with one product that does have product/market fit, it’s incredibly hard to build a second one.
- Must-Have vs Nice-to-Have – Very few products are a must-have. The chances are high that while the first product was a must-have, the second product was a nice-to-have.
- Best People Challenge – With one product working, the likelihood that the very best people are assigned to a new product is low. And, if they are assigned to the new product and the first product starts to have issues, they’ll be pulled back to the first product immediately.
Second products can work but entrepreneurs would do well to maximize every element of their core product before expanding.
What else? What are some other reasons why second product initiatives fail?
David Cummings on Startups 
SalesLoft comes to mind as an example of a successful product migration. Commiting dev resources to 2 products never makes sense but as part of a migration dont you think its a marketing issue?
The first company that came to mind when I saw the headline was a counter example – SalesLoft – they seem to have done a better job with their second product (Cadence) than with their first (Prospector). What are your thoughts there?
Re: Salesloft, for those commentors here. Always saw prospector as a just stepping stone to a broader moat.
Re: other 2nd prod fail reason? – strong branding/msg of the first. Many startups today tend to launch with a singular focus of exiting on that niche solution. Everyones elses perception of the first hinders opportunity to launch the second. Instead if the startup has a longer term biz plan, e.g. Atlassian, a suite can be formed.