Raising millions of dollars from great investors does not equal product-market fit. This episode features Zari Zahra, Co-founder & CPTO, Spekit to talk about her journey to fundraising and the importance of setting the right milestone for the company and the path to finding the right product-market fit.
1. The rule of thumb for fundraising is to raise beforehand instead of running around. Take the time between the rounds to prove out and to set the milestones that give you the best value for the company and the best investor fit as well who can take you to the next level.
2. Startups can raise too much money depending on their needs. It’s about having a plan to correctly deploy that money and understanding its complete value of it. There are companies that need heavy upfront capital like fintech and logistics. it’s better to have a buffer.
3. Product-market fit is different for everyone. Your customers are already buying more and getting value out of your product is the biggest indicator of product-market fit. This includes knowing exactly the audience for whom you are trying to solve a problem, and having actual traction and money coming in.
4. One big mistake people make at the start is being a super waterfall. It is the desire to work on something for two years and then a big unveiling without feedback from the market. Market and customer data are crucial while starting out and not being literate enough about this is death to a startup.