Building an innovative product doesn't begin with a brilliant idea, but with actively listening to the market. This was the premise that guided the most recent episode of Start Growth Talks , a podcast by Start Growth hosted by Marilucia Silva Pertile and Carlos Castilho, which featured economist and investor Léo Jianoti, an angel investor at Curitiba Angels and professor at the Federal University of Paraná (UFPR), for a discussion on the concept of Product-Market Fit (PMF).
The term refers to the stage at which a product effectively meets a latent demand, generating legitimate and sustainable traction. “Product-Market Fit is when your problem and solution thesis is validated in practice. A single sale isn't enough; you need to observe recurrence, the pace of adoption, and the customer's willingness to pay the real value of the solution,” explains Jianoti, who is also managing partner of Zetta Venture Capital and venture partner at Honey Island Capital.
Only 1 in 10 startups achieves PMF (Product-Market Fit).
Despite being essential, reaching this point of maturity is rare. A survey by CB Insights shows that 35% of startups fail due to a lack of market demand, meaning they develop solutions for non-existent or irrelevant problems. Another study by Harvard Business School estimates that only 10% of early-stage startups actually reach PMF (Product-Market Fit) before exhausting their financial capacity.
To avoid this outcome, Jianoti argues that entrepreneurs should be more passionate about the problem than the solution. "You need to be clear about the pain point you want to solve and then test until you discover how to solve it in a viable way. Success is a consequence of this process," he assesses.
In practice, PMF manifests itself through specific metrics, which vary according to the business model. In the case of SaaS (Software as a Service) startups, for example, Jianoti cites as fundamental the Churn Rate , which indicates customer retention and is one of the best signs that the product generates value; the Net Promoter Score (NPS) , which measures the customer's willingness to recommend the service, highlighting satisfaction; and the MRR (Monthly Recurring Revenue) , which reveals the scalability of the business and its financial predictability.
“You need real traction. It’s not enough to have sales driven by bonuses or aggressive marketing. A customer who returns, recommends, and pays again is the best validation,” the investor points out.
Another highlight of the episode was the importance of team building. For Jianoti, the founding team is the first indicator of execution capability. "You can have the best product, but without a resilient, complementary team engaged with the purpose, no business will survive," he says.
Start Growth co-founder Mari Pertile adds a practical approach: “When I led a team of 265 salespeople, I realized that engagement came when we connected the personal dreams of the employees to the business objectives. This applies to any startup that wants to grow with a solid culture.”
Furthermore, the economist draws attention to market size as a prerequisite. "Excellent teams operating in small markets frequently fail. Scalability depends on a large market with significant gaps," he notes.
The investor's role and the ideal timing.
With experience investing in startups like James Delivery and Contabilizei, Jianoti states that timing is one of the least measurable, yet most decisive factors. “We’ve invested in the right businesses at the wrong time. Or worse, we’ve failed to invest in solutions that, years later, became market leaders. Timing is the invisible wind that accelerates or brings down a startup.”
State of Startups 2024 report , prepared by First Round Capital, 42% of founders cite timing as the main reason for their companies' success—above product, team, or business model.
According to experts, Product-Market Fit is not an isolated event, but an ongoing journey. “Finding PMF is just the beginning. After that, it needs to be maintained, adjusted, and expanded. It can be lost at any moment if the market changes and the product doesn't keep up,” warns Mari.
The episode also brought a series of reflections on organizational culture, purposeful leadership, and the importance of constantly communicating with customers. "Great businesses are born from listening. Entrepreneurs who don't talk to their customers are inventing for themselves, not for the market," concludes Carlos.
