Make Something Buyers Want – A Simple Explanation of Product-Sales Fit

Generated by DALL·E

At Long Term Impact, we believe a critical ingredient for success of an early stage edtech startup is that founding team has fully embraced being Salesperson #1 – especially if they are pursuing the “third way” of growth. The longer the founders avoid sales, the further they fall behind in finding product-sales fit. What is product-sales fit? 

Product-sales fit is making something buyers want

Y Combinator has famously defined product-market fit – the singular goal for every startup – with their slogan: make something people want. In theory, it sounds so simple and obvious. In practice, it’s really really hard! Most startups fail to achieve product-market fit. Most founders fail to make something people want. 

Product-market fit is twice as hard in education

If you’re in K-12 EdTech, we believe finding product-market fit is twice as hard. Why? Because it’s highly likely that the people YC are talking about are actually made up of two very different and distinct groups: users and buyers. 

• Users: people that benefit from directly engaging with your product.

• Buyers: people who will pay money for your product.

At Goalbook, our users are special education teachers and specialists. They use our product to help them design and implement individualized instruction for the students with IEPs. Our buyers are school districts. Specifically, our buyer is the Director of Special Education – the senior-most district leader who has the authority to make programmatic and budgetary decisions over special education. 

If you are building a K-12 edtech product, it’s likely your users and buyers are different too. Your users might be students, but your buyer might be parents. Your users might be classroom teachers, but your buyer might be school principals. 

• Product-User Fit: make something users want (to use).

• Product-Sales Fit: make something buyers want (to buy).

If you aren’t actively trying to sell your product to your buyer, then it’s likely you aren’t making any progress on finding product-sales fit. You might be making progress on making something that users want to use, but likely not making progress on making something buyers want to buy.

Selling To Learn Is More Important Than Learning To Sell

In Founding Sales, Pete Kazanjy describes the two different epochs of startup sales. In hindsight, his descriptions perfectly describe my experience with sales at Goalbook. I would have been more effective if Pete had published his book a bit earlier!

The first epoch is evangelical sales:

In the first epoch, it’s a tight, iterative process where you’re evangelically “selling” (there may not even be money involved) your solution (or, perhaps even “would-be solution”, before you’ve even started building it) to would-be customers, and sorting out if indeed they have the pain that you’re looking to address, how big that pain is, and what they’d be willing to pay to resolve it. This stage involves its own set of approaches, which, largely won’t be very scalable, but will support those early learnings.

The second epoch is scaling sales:

The second epoch comes only after you’ve passed the first. This is when you know your solution is viable, solves customer pain, for which they are willing to pay money, and now it’s simply a question of scaling the number of humans who are doing the selling, and, by extension scaling all inputs and outputs associated with that activity. 

Notice the difference? The first epoch is primarily about learning, not about revenue. The first epoch is where we are totally focused on figuring out how to make something buyers want. We are trying to find product-sales fit.

The second epoch starts once product-sales fit is found. The second epoch is when the focus shifts to increasing revenue through building teams and systematizing scalable practices. 

Please Don’t Hire a Salesperson (Yet)!

With the best of intentions and with high enthusiasm to grow revenue, many startups make the mistake of skipping the first epoch and try to go straight to second – they scale sales before product-sales fit. They hire a VP of Sales. They build a team of salespeople. They adopt a sophisticated CRM and start meticulously measuring conversion rates at each stage of the funnel. They build out a library of “sales enablement” materials and set up automated marketing capture and drip campaigns, …

Don’t worry, you’ll get the chance to stress about all that second epoch sales stuff soon enough. But right now, you’re firmly in the first epoch. The only sales goal that matters is finding product-sales fit. It’s figuring out how to make something buyers want. 

We hope to share some strategies and lessons on how to go about finding product-sales fit soon. But the most essential ingredient of finding product-sales fit is going out and trying to get as many sales conversations with buyers and trying to learn from every sales conversation you have.