Why so many builders fail to hit the Growth stage

When talking to founders about growing startups, we keep hitting the same roadblock: scaling beyond product-market fit is tough.

For those few who made it, finding it was hard enough, but let's get real about why your next step is even more challenging and what you can actually do about it.

The Joy and Challenge of Building

Builders enjoy building.

You’ve crafted a product that solves a problem. Your initial users – friends, family, the early tech lovers from Product Hunt – are all over it. You have those butterflies in your stomach like you're finally getting somewhere after a year in the founder pain cave. They're a small bunch but passionate, excited, praising your baby startup.

However, this is just the starting point, not your growth engine. You can’t scale with just them, and that's where the confusion begins. You find yourself back in your lonely cave, trying to figure out what to do next. Those early enthusiasts want to be the first to try new tech. I’m that kind of person myself, so I constantly receive feedback that I might be too far in the sky when talking about concepts that keep me awake at night.

Understanding Your Audience

But those 2-3% of the market will not be enough to grow your startup. The next round involves visionaries. They are a very similar beast to the enthusiasts but also care about being seen as visionaries to their networks. They bring new tech like viruses to their teams and companies. Even with around 10-13% of such visionary users, they are not so many in mid-market companies, which consist of pragmatists, conservatives, and skeptics.

So, how should a builder talk to these five different types of audiences?

How should the product be communicated, and how should these different people be reached? What specific business models work at every stage?

Focusing on Your Current Stage

There are so many questions, but the key is always to focus on your current stage. First, identify the stage you are at and what type of business you are building (who is the target audience) and focus, focus, focus.

Strategies for Different Markets

Mid-Market Strategies: If you are targeting the mid-market, get ready for a tough ride. You'll need to explain clearly and precisely in very clear terms why they should start using your product. That's hard and should be driven through founder-led sales, which is challenging for tech founders.

SMB Strategies: If you are building a tool for SMBs, they have different risk aversion levels compared to those in established companies, so they might try it themselves and buy after they see the value for themselves. This requires a clear understanding of the product-channel fit and channel model fit.

Learning from Success

Many companies nail the PMF but miss out on these other elements, hitting a growth ceiling they can't break through. In 2017, Brian Balfour laid out these concepts with clarity. His work still stands as a foundational guide for companies looking to grow meaningfully.

Your Detailed Action Plan

• Identify Your Audience: Understand who’s going to use your product next. Tailor your channels, business model, and ensure you know what to say based on discovery. (Done your homework, eh?)
• Tailor Your Message: Focus on clarity. What problem does your product solve for them? How will it make their work easier? Answer these questions in plain terms.
• Founder-Led Sales: Prepare for the grind, especially if you're targeting mid-market businesses. It’s tough but essential. I suggest to reach out to Rob Snyder for brilliant insights or join his bootcamp to kick this off.
• Adjust Your Channels: For SMBs, demonstrate your product's value in action, build user friendly easy to use product. For Mid-market make sure you have case studies and you know the exact language and understand the decision making process to get the hearts of those busy corporate leaders. Choose channels that fit this dynamic of your audience.
• Flex Your Business Model: Be ready to pivot your pricing and sales strategy according to market expectations and channels so your unit economy will make sense.

Scaling beyond product-market fit challenges us to deeply understand our audience and tailor our approach precisely. The journey is tough, full of lessons on focus, adaptation, and persistence. And consistency. And resilience.

Please share your learnings and experiences in the comments!

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