Process of dollar-driven discovery

Todd Jackson is a Partner at First Round Capital. Before moving into venture capital, he played a crucial role as VP of Product and Design at Dropbox, guiding the company until its IPO in 2018. Prior to Dropbox, Todd led product management for Twitter’s Content and Discovery teams after selling his startup, Cover, to Twitter in 2014. Before Cover, Todd oversaw product development for Facebook’s Newsfeed, Photos, and Groups. He kickstarted his career at Google as an associate product manager and eventually led product for Gmail, witnessing its growth from beta to 200 million users. In our conversation, we discuss:

• Why product-market fit (PMF) matters

• First Round Capital’s four-part PMF framework

• Level one: Nascent product-market fit

• Level two: Developing product-market fit

• Level three: Strong product-market fit

• Level four: Extreme product-market fit

• Examples of companies at each level

• How to know if you’re stuck at a level, and how to get unstuck

• What to change if you’re stuck: persona, problem, promise, and product

• The goals and challenges at each stage

—

Brought to you by:

• WorkOS—The modern API for auth and user identity

• Eppo—Run reliable, impactful experiments

• CommandBar—AI-powered user assistance for modern products and impatient users

—

Find the full transcript at: https://www.lennysnewsletter.com/p/a-framework-for-finding-product-market

—

Where to find Todd Jackson:

• X: https://twitter.com/tjack

• LinkedIn: https://www.linkedin.com/in/toddj0/

—

Where to find Lenny:

• Newsletter: https://www.lennysnewsletter.com

• X: https://twitter.com/lennysan

• LinkedIn: https://www.linkedin.com/in/lennyrachitsky/

—

In this episode, we cover:

(00:00) Todd’s background

(06:07) First Round Capital’s PMF framework

(09:07) Why product-market fit is so important

(11:02) Who can benefit from this framework

(12:55) The product-market fit method

(16:54) Broad overview of the framework

(21:35) Level one: nascent product-market fit

(33:16) The four P’s

(39:13) Level two: developing product-market fit

(49:13) Signs you’re stuck at level two, and what to do

(55:12) Level three: strong product-market fit

(01:00:17) Signs you’re stuck at level three, and what to do

(01:02:22) Level four: extreme product-market fit

(01:06:55) Rough timelines for each level

(01:11:18) A quick recap of the framework

(01:12:15) Diving deeper on the four P’s: what to do if you’re stuck

(01:13:56) Dollar-driven discovery

(01:25:11) Apply for the product-market-fit method program

—

Referenced:

• First Round: https://firstround.com/

• Twitter Acquires Cover: https://www.vox.com/2014/4/7/11625332/twitter-acquires-cover-an-android-mobile-startup

• Dropbox: https://www.dropbox.com/

• Rahul Vohra on LinkedIn: https://www.linkedin.com/in/rahulvohra/

• How Superhuman Built an Engine to Find Product Market Fit: https://review.firstround.com/how-superhuman-built-an-engine-to-find-product-market-fit/

• How to validate your startup idea: https://www.lennysnewsletter.com/p/validating-your-startup-idea

• How the most successful B2B startups came up with their original idea: https://www.lennysnewsletter.com/p/how-the-most-successful-b2b-startups

• How to know if you’ve got product-market fit: https://www.lennysnewsletter.com/p/how-to-know-if-youve-got-productmarket

• A guide for finding product-market fit in B2B: https://www.lennysnewsletter.com/p/finding-product-market-fit

• Product-market fit method: http://pmf.firstround.com/

• Stripe: https://stripe.com/

• Plaid: https://plaid.com/

• Paths to PMF: https://review.firstround.com/series/product-market-fit/

• WeWork: https://www.wework.com/

• Casper: https://casper.com/

• Vanta: https://www.vanta.com/

• Christina Cacioppo on LinkedIn: https://www.linkedin.com/in/ccacioppo/

• Ramp: https://ramp.com/

• Velocity over everything: How Ramp became the fastest-growing SaaS startup of all time | Geoff Charles (VP of Product): https://www.lennyspodcast.com/velocity-over-everything-how-ramp-became-the-fastest-growing-saas-startup-of-all-time-geoff-charl/

• Jack Altman on LinkedIn: https://www.linkedin.com/in/jackealtman/

• Lattice: https://lattice.com/

• Zachary Perret on LinkedIn: https://www.linkedin.com/in/zperret/

• Positioning: https://www.lennysnewsletter.com/p/positioning

• Retool: https://retool.com/

• David Hsu on LinkedIn: https://www.linkedin.com/in/dvdhsu/

• Persona: https://withpersona.com/

• Rick Song on LinkedIn: https://www.linkedin.com/in/rick-song-25198b24/

• Lloyd Tabb on LinkedIn: https://www.linkedin.com/in/lloydtabb/

• Looker: https://en.wikipedia.org/wiki/Looker_(company)

• Jason Boehmig on LinkedIn: https://www.linkedin.com/in/jboehmig/

• Ironclad: https://ironcladapp.com/

• Lessons in leadership | Scaling an org and tactical management advice | Jack Altman (Lattice): https://www.youtube.com/watch?v=cZzXqf61mrQ

• Filip Kaliszan on LinkedIn: https://www.linkedin.com/in/kaliszan/

• Verkada: https://www.verkada.com/

• Ali Ghodsi on LinkedIn: https://www.linkedin.com/in/alighodsi/

• Databricks: https://www.databricks.com/

• Stripe Radar: https://stripe.com/radar

• Stripe Atlas: https://stripe.com/atlas

• Square Stand: https://squareup.com/shop/hardware/us/en/products/ipad-pos-stand-integrated-card-reader

• Cash App: https://cash.app/

• Square Checking: https://squareup.com/us/en/campaign/banking/checking

• Square Loan: https://squareup.com/help/us/en/article/5654-get-started-with-square-capital

• Casey Winters on LinkedIn: https://www.linkedin.com/in/caseywinters/

• How to sell your ideas and rise within your company | Casey Winters, Eventbrite: https://www.lennyspodcast.com/how-to-sell-your-ideas-and-rise-within-your-company-casey-winters-eventbrite/

• Josh Kopelman on LinkedIn: https://www.linkedin.com/in/jkopelman/

• The art and science of pricing | Madhavan Ramanujam (Monetizing Innovation, Simon-Kucher): https://www.lennyspodcast.com/videos/the-art-and-science-of-pricing-madhavan-ramanujam-monetizing-innovation-simon-kucher/

• Simon Kucher: https://www.simon-kucher.com/

—

Production and marketing by https://penname.co/. For inquiries about sponsoring the podcast, email podcast@lennyrachitsky.com.

—

Lenny may be an investor in the companies discussed.

This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.lennysnewsletter.com/subscribe