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Before we identify your market, it’s important to understand what assumptions are and why they matter.

Assumptions are educated guesses based on observations and insights.

They need to be tested and validated.

As you progress through experiments, these assumptions will either be validated or disproved, guiding your next actions.

New assumptions are continuously made based on new observations and insights driven by the experiments.

The first significant assumption you need to make is about your Ideal Customer Profile, or ICP—who exactly are you building this product for? And why should they care? The ICP is subjective.

The persona you’re after is ideal for you.

There is no absolute ideal customer.

It’s all relative.

You want to pursue a customer profile that is easiest for you to acquire, satisfy, and monetize.

Why? Because you’re a startup.

You’re low on resources, so you need to focus your energy where it counts the most.

With a well-defined ICP, your product and marketing efforts are focused on this single profile.

But who is this persona? And how do we find it? The trick is to use filters.

Take your total addressable market and start filtering in or out based on key attributes.

Your ICP is basically a filtered view of your total addressable market.

Pain filters focus on the severity and frequency of the pain.

For example, if my business experiences hacking attempts daily, and that creates frequent downtimes for my customers, my pain is much bigger than a small business that never has downtimes.

Tech stack filters are critical when you need to narrow your focus.

Don’t waste energy on both Android and iOS, or Azure and AWS.

Building the same product for two different ecosystems is resource-intensive.

Pick the one that makes more sense for you.

There could also be other tech stack options, like QuickBooks versus Xero, or Google Workspace versus Microsoft.

It all depends on the context and the market.

When you reach Product Market Fit, you'll have complete clarity on a few key questions, which you'll confidently be able to answer.

Who am I helping? What's their most significant pain point? How can I reach them? What are they trying to achieve? How am I helping them achieve that? And finally, how am I retaining some of that value and making a profit? Answering these questions confidently, based on actual outcomes rather than aspirations, means you've found Product Market Fit.

The answers to these questions tell a story which I call the PMF narrative. It can start with a dream, but over time you need to ground it in real evidence. For that you need to focus on finding the right answers to these questions. When you do, you won't just have a compelling PMF narrative, you will have achieved Product Market Fit itself!

So, how do you get there? To establish this narrative in reality and achieve PMF, you need to work with two main tools: assumptions and experiments.

These are the building blocks that allow you to test, refine, and ultimately prove that you've reached Product Market Fit.

In this short audio series, we'll explain exactly how you can use assumptions and experiments to discover and validate your Product Market Fit, and how that journey translates into a clear and compelling narrative.

Let's get started.

Now that we’ve introduced the goal of Product Market Fit, let’s talk about how to get there.

To discover Product Market Fit, you need to test both your market and your product.

You’ll do this through a cycle of assumptions and experiments.

This process will help you figure out what works and, just as importantly, what doesn’t.

First, you need to focus on market discovery.

This is where you figure out who your Ideal Customer Profile, or ICP, is and what value proposition resonates with them.

It’s about identifying who you’re helping, understanding their needs and pain points, and figuring out how to reach them.

The right market is out there, you just need to find it! Next, you move on to product development.

Once you’ve found the right market, it’s time to develop a product that effectively solves their needs.

But it’s not just about creating the product, you also need to develop a business model that’s both profitable for you and acceptable to your ICP.

These two aspects, market discovery and product development—are the foundation of finding Product Market Fit.

Throughout this process, assumptions and experiments will be your tools to refine and validate each step.

In the next few episodes, we’ll dive deeper into these aspects.

We’ll start with market assumptions, then move on to market experiments, and later, we’ll cover product assumptions and product experiments.

We’ll explain how these tools are used to iterate and fine-tune your approach.

As a bonus, we’ll have a final episode where we’ll cover common mistakes that many founders make on the path to Product Market Fit, and how to avoid them.

Let’s get started with market assumptions in the next episode.