How to Find Product-Market Fit?

Jan Nowak’s Bio 

Jan Nowak is the founder of a company called BOTWISE - a dedicated knowledge base for customer service. The idea behind BOTWISE was a corporate search tool, but currently, they are more focused on customer service, where the speed of accessing the information is the most important. Stunningly, BOTWISE can help users save even 90% of time searching and gathering information.

There was a decent share of ups and downs since BOTWISE’s story began, and Janek is ready to share his vast experience in today’s interview. So, let’s dive into the practical example of finding a product-market fit to see the process itself and learn what mistakes to avoid.   

Questions

Nat: You chose today's topic: “Finding a perfect Product-Market Fit.” Why exactly this very topic?

Janek: Finding a product-market fit issue was very close to us, mostly because we've been struggling at this stage. We've been trying and experimenting for a while before settling on a profitable idea. And that's why I’d like to discuss and dwell a bit more on how it actually looks from a startup perspective, as we didn’t have any investors by choice. And, actually, we're still bootstrapping. 

Nat: What comes first - a chicken or an egg? Do you choose the right market for your product, or do you adjust your product to the needs of the market?

Janek: I think it works both ways. In our case, it was a massive coincidence that we ended up doing what we're doing. 

It all started when we attended a hackathon organized by a bank. It was a great opportunity, especially meeting a lot of people that came through with their needs and ideas. As we talked with people there, we came up with the idea to build a chatbot that would support the customer service teams in answering clients’ questions much faster. We were neither customer service experts nor banking experts. So, that was a pure coincidence that we were interested in AI and knew how to build software that could fit their needs. 

It was actually a good starting point because we already had the needs and the customer. And we thought if at least a few people in one of the biggest banks want that, there’s a probability that everyone else with a similar profile will be happy to have it. 

Nat:  How do you identify that BOTWISE is doing something right? And, vice versa, how do you understand that you're in the wrong place?

Janek: At the moment, we're definitely not in the right place. We don't have a strictly product-market fit and are struggling with scaling up at the moment. I’d say that we’re still looking for the right product-market fit. Our route from the beginning was different, and we didn't pivot as quickly as we should have. But we have our lessons learned, that’s for sure. 

As I mentioned before, we started as a chatbot for the customer service teams. They could upload their documents and ask the chatbot to retrieve the answers quickly from those. At some point, we even thought we successfully did this proof of concept in implementation for the bank, as back then, we reduced the average handling time by 7%. For 400 agents, that's actually a lot. 

But after that, we struggled to get other customers who have similar profiles with similar needs anyway. It actually took us too much time to notice that probably we were not in the right place with the timing and that our functionality was more like a ‘nice-to-have’ feature. And the teams we were targeting still needed to solve more basic needs first. 

Only later on did we go into the corporate search and come to the conclusion that everyone usually has multiple means of storing information. For example, we have SharePoint, Dropbox, Drive, Slides, emails, etc. And everyone who works for the company is browsing through all those applications every day to look for an answer. So, the news was pretty clear - and everyone was excited about this idea. 

But, at this stage, we encountered the problem in a different place. During implementation, the security of connecting different systems within an organization was a lot of risks, a lot of paperwork, a lot of compliance work, and a lot of API setups. 

So, even though it appeared like a good idea for everyone when it came to the implementation, it was too hard to do. Especially with our strictly limited resources, as we still were not very pursuing VCs actively, at that time, we wanted to bootstrap. 

Once again, it took us too much time to realize that this is probably not the solution that we should pursue. For the last few months, we've been focused on the dedicated knowledge base for customer service. Mostly because we've been working with the customer service teams for most of the time. In terms of software, it's still similar to what we did before, but now we’re more focused on building not only the search that is smart and can extract information from thousands of documents, but also on features for managers to track the team performance and managing the knowledge base. 

Nat: What is a step-by-step process of finding a product-market fit from your experience? 

Step 1: Start with creating a landing page and a promo campaign to see if there is any traction. Also, do some surveys, and research the market before even starting to code anything. Getting the first customers and users also helps you to work on the MVP. When you already have a user base that you reach out to on a regular basis, send them any updates, and ask them for feedback. This way, you’ll get valuable information to build the MVP that people will actually use and like. Don’t go to the basement with your developer team, sit there for the whole year, and then go out to the market to see if this is actually something that people need. 

Step 2: When you launch the MVP, talk with as many users as you can. At BOTWISE, we’re doing a whole set of different exercises to see what's happening in our app. For example, we organize interviews with our users. This way, we’re both onboarding the company and talking to its agents - the actual end users. 

Apart from the interviews, we do surveys using Mixpanel to track how much time users spend on the app and what features they use. This provides us with valuable data that will help in developing future updates, for example. 

Step 3: Prioritize the feedback in a proper way. It's really important for us to make the right call and work on the features that are useful for the majority of users. From our experience, users don't actually know what they want. Sometimes you need to give them hints and ask appropriate questions to lead them to the answer they are looking for. 

Nat: You mentioned that even after finding a product-market fit, you still need to constantly make some changes. So, how can one adapt to those ever-lasting changes? 

Janek: I would say to do the things I mentioned on a regular basis. Talk with your users all the time - both new and old ones - to find out if the tool is better now and if they see a difference. Be in a continuous conversation with all the users to grow your customer base because you’ll need to make sure that not only the new customers are joining, but the current ones are staying. And their retention is the most important SaaS metric that you want to track closely.

You cannot actually dwell on achieved success. It's a constant improvement.  

Rapid-fire round

Nat: Your biggest regret?

Janek: My biggest regret is that we didn't pivot quicker.

Nat: Who is your business hero? 

Janek: Probably Elon Musk. I think this is the answer for a lot of people, but this guy is really exceptional. And this is a reasonable answer.

Nat: You've recently become a father, could you give one survival advice for future dads?

Janek: Be patient and consistent. And this can also apply to startups and businesses. It's not about working very hard because you will burn out quickly and quit after a few mistakes and not have success for a while. So, being consistent is the key for success, in my opinion.

Get to know Jan