Why mastering distribution is the key priority after reaching product-market-fit
When startups “hit it” and reach product-market-fit, they become scaleups. And
the first thing they need to learn as a “freshman scaleup” is how to scale their
marketing and sales. Mastering acquisition or, in other words, mastering
DOUG: The freshman scaleup is the first “real” scaleup stage.
ROLAND: Yes, freshman scaleups have reached product-market-fit. They have
moved out of classic startup territory and into solid scaleup territory.
DOUG: What customers do freshman scaleups have?
ROLAND: Freshman scaleups are starting to sign up more paying customers. The
bulk of customers they sell to now are visionary business users. People who love
the technology less for its own sake and more for the impact it can generate.
Customers in this stage look to use the product to gain a competitive advantage.
DOUG: What milestone have they reached and how much have they raised?
ROLAND: Freshman scaleups have reached product-market-fit. That means that
they have found a market willing to pay for their problem-solution-fit. They
have a working revenue model. Freshman scaleups have raised a Series A round
from “proper” venture capitalists.
DOUG: How mature can you expect their product to be?
ROLAND: Freshman scaleups’ products are not only functional. They are
impacting people’s business or lives. Anecdotal case studies dominate their
marketing. They all explain how the product gave visionary buyers an unfair
DOUG: What, especially, do freshman scaleups need to learn?
ROLAND: Freshman scaleup teams are trying to master building up
distribution. They want reliable marketing and sales processes that go beyond
mere growth hacking.
DOUG: How big are freshman scaleups, in your mind?
ROLAND: Freshman scaleups have more people than the typical startup, from
10–25 employees. They still feel like close-knit families. But you do see the
first distinctions between “managers” and “frontline workers” appear.
Freshman scaleups also start to have a more solid revenue base, from one to five
million dollars per year.
Roland Siebelink regularly speaks and writes about leadership in fast-growing
tech startups. You can find more of his insights, including free chapters of his
book “Scaling Silicon Valley Style” here.