How to find the right market fit for your product, according to Peter Reinhardt

Segment

• Peter Reinhardt, CEO and co-founder of data analytics
  company Segment, struggled to find the right market fit for his
  product on his first two attempts with his
  company. 
• When he finally started working on a product that was
  right for the market the third time around, he said he noticed
  a fundamental shift in the way people received his
  idea.

Peter Reinhardt, CEO and co-founder of data analytics company
Segment,
discovered how to find right product fit the hard
way: He struggled to find a proper application for his
company’s product twice before hitting gold the third time
around.

In retrospect, he says there was a fundamental difference in
early conversations surrounding the current iteration of his
product, compared to the examples that turned out to be less
successful. 

“Most founders tend to think that they’re a tweak away from
finding product market fit,” said Reinhardt. 

If you’re struggling to find a market that’s clamoring for your
product however, Reinhardt says this might be the wrong approach.
When you have a product people want, you’ll know
immediately. 

“If you’re close to what the market wants, it will literally get
ripped out of you hands,” said Reinhardt. “It feels like you’re
stepping on a landmine. It’s not something you can prepare
yourself for. It’s like you’re trying to get the cats back in the
bag.”

When Reinhardt released a version of his data analytics software
on Opensource on a third and final attempt for his product,
people were immediately eager to try it out, he said.

“It was like ‘Oh, shit … we’re already in over our heads,'”
Reinhardt recalled.

There was a fundamental shift in the way his potential customers
were talking about his product as well. 

In earlier conversations, when he was working on a
less-successful version of Segment’s software, potential
customers would usually express interest, but it was
passive. 

“They’d sit back and say, ‘Oh, interesting. I see how that’s
valuable. That’s very cool.'”

This was a bad sign, said Reinhardt. A product that people will
want to buy will typically move the conversation
forward — it will result in future meetings,
connections, and conversations.

When Reinhardt and his team
changed their product the third time, conversations with their
potential customers rarely focused on theoretical value, he
said.

“They’d say, ‘Can we set up a
conversation with this person and this person?’ They never
mentioned anything about value. It was clearly about solving a
problem. It was immediate, a totally different thought process.
When you find right product fit, it becomes concrete very, very
fast.”