- The video discusses three signs of product market fit from different companies
- The first sign is if people continue to actively use a broken product or have high retention on it, indicating market adoption
- The second sign is if major brands organically find and pay for a SaaS company's product
- The third sign is strong customer feedback, even from a small group of people, such as receiving love letters or emails expressing gratitude for the product's impact on their lives.

Early stage startups should focus on finding product market fit; but how do you know when you have it? Entrepreneur and investor Elad Gil tells us how.

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Yeah, I think it's obvious if you think about it the right way, but I think it's very hard otherwise.

So I'll give you 3 examples of signs that you have product market fit from 3 different companies.

You know, if your product is broken and people are still using it very actively, or you have high retention on a broken product, that's a clear sign of product market fit.

When Twitter was constantly going down in the fail whale days, and yet nobody moved off of Twitter, that was a sign of just raw market adoption.

A second sign is if you're a SaaS company and you have major brands finding and using you organically and paying for your product, that's a sign of product market fit.

So examples of that would be PagerDuty, which had, I think, Apple as an early customer.

There's Zeppelin, which had, I think, Facebook using them very early.

Airtable has all sorts of brands that have just sort of adopted it.

So I think there's a number of sort of more recent breakout-y companies where big brands are just showing up and starting to pay, And I think that's a clear sign of product market fit.

The last 1 is just whether you have very strong customer feedback, even from a small group of people.

So at Color, for example, very early on, we were getting effectively love letters from our customers.

The company Color started off focused on providing people with information about their hereditary risk of certain genetically driven cancers.

And we were getting emails from people where they were saying, thank you so much for helping me, for making this affordable.

So saving their lives, for saving their lives in some cases That you know they felt that the color to help with that and so you


Speaker 0: Yeah, I think it's obvious if you think about it the right way, but I think it's very hard otherwise. So I'll give you 3 examples of signs that you have product market fit from 3 different companies. You know, if your product is broken and people are still using it very actively, or you have high retention on a broken product, that's a clear sign of product market fit. When Twitter was constantly going down in the fail whale days, and yet nobody moved off of Twitter, that was a sign of just raw market adoption. A second sign is if you're a SaaS company and you have major brands finding and using you organically and paying for your product, that's a sign of product market fit.

So examples of that would be PagerDuty, which had, I think, Apple as an early customer. There's Zeppelin, which had, I think, Facebook using them very early. Airtable has all sorts of brands that have just sort of adopted it. So I think there's a number of sort of more recent breakout-y companies where big brands are just showing up and starting to pay, And I think that's a clear sign of product market fit. The last 1 is just whether you have very strong customer feedback, even from a small group of people.

So at Color, for example, very early on, we were getting effectively love letters from our customers. The company Color started off focused on providing people with information about their hereditary risk of certain genetically driven cancers. And we were getting emails from people where they were saying, thank you so much for helping me, for making this affordable. So saving their lives, for saving their lives in some cases That you know they felt that the color to help with that and so you

See all Y Combinator transcripts on Youtube

Elad Gil: When do you know you have Product Market Fit?