The Official SaaStr Podcast: SaaS | Founders | Investors SaaStr 080: Segment's Peter Reinhardt on Why The Reality Distortion Field Is Damaging When It Comes To Product Market Fit, How Founders Should Approach Pricing Negotiations with Large Corporates & How Founders Can Truly Determine Product Market Fit?
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Dec 5, 2016 Peter Reinhardt, Founder and CEO of Segment, shares insights from his journey to building a customer data platform used by industry giants. He discusses the critical concept of product market fit, emphasizing the dangers of the reality distortion field among founders. Reinhardt also explores how technical and non-technical co-founders perceive market fit differently. Additionally, he offers valuable advice on navigating pricing negotiations with large corporates and shares lessons learned from his experience in scaling pricing strategies.
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Early Startup Pivot Story
- Peter Reinhardt and co-founders started with a lecture tool for students but it was a failure when students ignored it and went to Facebook instead.
- Pivoting to solve analytics pain points led them to build Analytics.js, which rapidly gained user interest after being open-sourced.
Reality Distortion Field's Danger
- Reality distortion fields help founders convince others early but can dangerously delude founders about actual product market fit.
- True product market fit requires brutally testing assumptions, not just optimism or self-conviction.
Testing Product Market Fit
- Product market fit can be tested by gaining first 10 customers outside your personal network.
- This validates your product’s appeal beyond social connections and early supporters.