This article was originally published on Limitless.
Entrepreneurs across the world find themselves chasing the fuzzy but very important stage of finding product-market fit. When they make the move from India to the US, many make the assumption that their work in the new geography will be a step up from what they have already achieved in their home market.
The truth though is that the US has to be approached as a completely new market. And often, we find that the most successful founders have had to make the mind shift of going after market share, rather than market size. It can sound daunting, but founders now have more support than ever before when they make the move. There is a larger community of professionals, including other founders, venture capitalists, and the diaspora community.
This does not imply that they do the hard work for you. It just means that there are people whose experiences you can learn from. The US market requires razor-sharp focus, and an articulation of the founder’s vision of the firm, which translates into sales. And that is the starting point of making revenue in this market.
So where does one begin? Raviteja Dodda, the founder of MoEngage, Mohit Garg, CEO and co-founder of Oloid AI, and Rohit Choudhary, the founder and CEO of Acceldata.io weigh in, leaning on their experiences.
#0 What is PMF?
It will be useful to put it out there. A generally consistent and useful definition of PMF is when you get to 15-20 paying customers who are referenceable. We are assuming that this involves selling the same product to these 15-20 customers, as opposed to multiple products or heavily customised variations.
For Rohit, the plan was in place from the first day he began to think about Acceldata. It helped that he had exposure to the US market since 2006-07 in his previous role. “There are three things I would recommend over indexing on. Become industry fluent, culture fluent, and most importantly, build a network,” he says.
While building networks, think of finding advisors, potential customers, design partners, investors and even potential employees. This will help you build out your team as you begin to build your business in the US. Eventually, become the bridge to bridge the cultural gap between your India and US teams.
Mohit, who co-founded Mindtickle in 2012, finds that the US-India corridor now is a lot more conducive to the working of Indian founders and startups. But with time, the number of businesses solving different aspects of the same problem has also increased. Which means, just having a great product is not enough. You need to understand if the market is ready and willing to pay for what you have to offer.
“There is hardly any space where you won’t find well established, well-funded competitors. So finding a niche and differentiation is no longer about features of your product. It’s about a much deeper sense of the product market fit,” says Mohit.
#1 Have a plan
Founders often find themselves unprepared for the difference in the way the two markets operate, as both professional and cultural aspects play into this. But the bigger challenge is that Indian founders tend to think that just the product is enough. Even before founders make the first trip to the US before setting up a base, have a plan, a roadmap of the kind of customers you’d like to target.
“There is hardly any space where you won’t find well established, well-funded competitors. So finding a niche and differentiation is no longer about features of your product. It’s about a much deeper sense of the product market fit” – Mohit
#2 Reach your customers
You can never build your product without talking to your customers. You need to be able to understand what solutions exist and how they fall short when it comes to their needs. This, Ravi says, is the easy part. The difficult part is to get them in the room.
“You have to continue the process of PMF and refine PMF appropriate to the stage your business is at. What is working for a $200,000 revenue may not work for you at $10 million revenue, and your business also has to evolve to support your growth” – Rohit
“The problem always is getting people to speak to you and having a conversation with them,” says Ravi. He struggled for a few months when MoEngage first made its US foray. He finally decided to reach into his network in India to find common connections. “I often tell founders, ‘Can you use the India-US corridor startup ecosystem to get access to the relevant people?’ That’s where research comes into picture,” he adds.
Finding the right customers, Mohit explains, can’t be like a “fishing experiment,” where you drop the line and wait for a bite. The US is a market with scope for a wider and more fact-based validation of your product compared to India, because in the US you have access to a wider set of customers and more intimate conversations. This makes it extremely important for founders to identify the right customer profile who will appreciate their product.
“You need to figure out who can be the early adopters of your product,” he says.
But how does one identify the right customers? Rohit’s mantra: Figure out the balance between what you are selling and who is buying.
“The problem always is getting people to speak to you and having a conversation with them…I often tell founders, ‘Can you use the India-US corridor startup ecosystem to get access to the relevant people?” – Raviteja
Getting this seemingly simple equation right is where the challenge lies. Rohit explains with the example of a founder selling a sales automation platform. In this case, the questions you need to address in order to get to the right customer are:
1) How many sellers do they have?
2) What is your pricing model?
3) Are you priced by seat or are you priced by value or volume of data?
4) Have you identified your growth vector? Have you placed your proposition along that vector?
5) Is there a customer who’s willing to pay for that pricing?
The deeper you go into these questions, the easier it becomes to identify the right kind of customer for your business. It is important to remember though that this exercise is a continuous process, and will lead to some pivots and feature changes as you evolve and grow the business. “You have to continue the process of PMF and refine PMF appropriate to the stage your business is at. What is working for a $200,000 revenue may not work for you at $10 million revenue, and your business also has to evolve to support your growth,” Rohit adds.