👋 Hello! I’m Ivan. I write monthly about venture capital, sales and growth + a touch of Spanish dealflow. Join +8K startup riders:
Summary
🌊 Finding PMF: underrated superpower of validation + shipping more.
💡 Thinking: Barcelona’s startup ecosystem.
💵 Iberian Deals: 25 startup deals in Spain (>€240M).
🌊 Finding PMF
Here’s what you’ll learn if you keep reading:
An accurate definition of Product-Market Fit (that you’ll remember forever).
How to choose a Problem.
How to choose a Solution.
1. What is PMF?
Next time you think about searching for PMF, think about Sisyphus.
Sisyphus was a devious tyrant who killed visitors to show off his power. This angered some greek gods, who punished him for it. He was forced to roll a big boulder up a hill only for it to roll back down every time it neared the top, repeating this action forever.
This is what not having Product-Market Fit feels like. You may have sales, you may be converting leads - but you are still pushing the boulder uphill.
Whenever I hear someone telling me they’ve found PMF, I ask them if they feel like they are chasing the boulder downhill.
Because that is what happens when you really find it (most people get this wrong) - you have so much pent-up demand, that you literally can’t keep up.
Here’s the right way to think about it - in my subjective strong opinion, loosely held:
Pre-seed: choosing a problem, start validating a solution (with $).
Seed: MVP, rapid iteration, stronger validation.
Series A: pouring gasoline.
2. How do I choose a Problem?
This is Ilia Topuria, the new Spanish UFC featherweight world champ. Ilia gets punched in the face every day during training. He chose MMA as a career because he loves the problems he is solving on a daily basis - not the end-result.
The championship belt came as a result of him choosing a problem to work on for sufficiently long and with enough energy to stick with it long enough for luck to find him.
Of course, skill and finding the right points of efficiency and leverage in his training (we all have the same amount of hours in a day) played a big role.
But the point remains: do not underestimate how hard building something is. Choose the right mountain to climb (problem).
Or, you’ll get knocked out with all the inevitable punches that will be coming your way.
So, how do you find the right problem to work on?
Target the intersection of what you love, what you are naturally good at (specific knowledge), what the world needs, and what the market is asking for.
This is all great, but how can I actually act on this?
First, and this depends on your personality, find a co-founder.
A lot of people do this wrong (in my opinion), by looking forward towards “new” people they could entice to bring into a project.
My recommendation (biased): think about who you’ve crossed paths with during your life that you felt a connection with, that could fit becoming a cofounder.
Next, open up a Google Spreadsheet, fill it up with the following fields - and book 30’/week with your potential cofounder to discuss problems you’ve been adding to the list. Here’s what it could look like:
3. How do I Validate my Solution?
Lets say you’ve found a cofounder, you’ve identified the right mountain to climb (problem), and you are now starting to play around with solutions to solve that problem.
We are now entering the sisyphus uphill boulder-pushing phase.
Here are the 3 main enemies wantrepreneurs typically face:
Ovethinking: Death by analysis paralysis, “the product is not ready”.
Fear of Asking: Death by “There’s no way I’m asking for money”.
Wrong type of love: Death by falling in love with the solution.
How can you avoid this pitfalls? 👉 Validate First.
I love Noah Kagan’s “Million Dollar Weekend” framework on the incredibly underrated concept of Validation. Here’s the tl;dr:
1. Avoid building anything before Validating
SaaS stands for Software as a Service.
You need the SERVICE first BEFORE the software even exists.
Find a way to offer the service without coding and investing a ton of effort.
2. Validate with one of the following 6 techniques
Crappy Drawing Method: draw it. I did this with a BJJ app on Reddit to get a developer and gauge interest. Some interest, but not enough. I shut it down.
Wallapop / FB Marketplace: I used it to try and launch a surfboard marketplace. Got dozens of surfboards listed through this method, and a couple sales. Not enough validation, I shut it down.
Simple Email Style: email friends. If they’re willing to pay for your product or service, then you may have it.
Pre-Selling: i.e. “making a batch of X product, book one for $x by paying here: Paypal link”.
Product-I-Zation: do paid work for 1 person, find a second, etc. THEN build product.
Home technique: restaurant, store, yoga studios etc? Out of your home.
3. Chase velocity to paying customers
Email subscribers, form signups, or better yet - people giving you cold hard cash.
In my case with Revenue Squared, I chose a mixture of “Simple Email Style” and “Pre-Selling” to validate that the problem was worth solving, and that people were willing to pay for the solution we were going to build out:
When it comes to building an MVP, we wrote about this in the past, but here’s the tl;dr:
Keep it simple
Get a product out quickly: days/weeks, not months.
Condense what your user needs.
Talk to users and get feedback: Be flexible.
Learn and iterate fast: until it actually solves a real problem in a way users value.
And again, love the problem, don’t fall in love with the solution. Be willing to scrap everything and get back to the drawing board.
Finally, and most underrated of all - just SHIP MORE.
Zuck built a bunch of projects before Facebook became a hit.
Peter Levels has shipped over 70 projects, and only 4 of them ever made money.
If you really want to start a business, and not everyone should (and that is perfectly fine, reasonable and often better!) - ship more, fail faster and validate first 🤙.
P.s. There are exceptions to using this approach, such as working on extremely hard problems. But even then, I can come up with counter-examples where this framework can also apply (i.e. Elon’s cybertruck was pre-sold for years prior to starting production, Zuck built Facebook’s initial product in a weekend, etc.).
💡 Thinking
I just moved to Barcelona, and it reminds me a lot of California.
Here's why it has a ton of potential (if we fix the regulatory environment):
Geography and Climate: Perfect score.
Gastronomy: Rivals Bilbao 😜.
Talent: A growing mix of national and international expertise.
Culture: Unmatched, enriched by diverse community bonds that I've not found elsewhere, despite having lived in five countries.
Security: Both legal and physical (everything is relative).
Education: Home to top-tier technical universities.
Funding: Strong support from public entities boosts the ecosystem and investment opportunities.
Tech ecosystem: blossoming with a number of successful startups that are producing repeat entrepreneurs and attracting more and more talent.
If you are thinking of making a move, just do it 🤙
💵 Iberian Deals
You love startups and want to enjoy a Spanish lifestyle? Come join the Spanish startup ecosystem. Here’s a list of recently funded startups:
ID Finance (fintech) raised €140m.
Heura Foods (foodtech) raised €40m.
Embat (fintech) rasied 15M.
Paack (logistics) raised €10m.
LUDA Partners (pharmacy tech) raised €12m.
Zylon by PrivateGPT (AI) raised €3.2m.
WIVI vision (health tech) raised €4m.
Aldara (proptech) raised €2.7m.
Clevergy (energy) raised €1.5m.
Trak (health) raised €1.3m.
Deale (M&A services) raised €1m.
UrbanFisio (health) raised €1m.
Mitiga Solutions (climate tech) raised €1m.
Wolo (proptech) raised €1.5m.
Ailin.health (health) raised €1.5m.
Pack2Earth (sustainable packaging) raised €1m.
CubicUp (proptech) raised €1m.
Agrow (agritech) raised €650k.
Genesy AI (sales AI) raised €450k.
WoWplay (edtech) raised €400k.
habitacion.com (real estate) raised €400k.
Manglai (SaaS, carbon footprint) raised €500k.
Virmedex (ar/vr training) raised €150k.
Muse Scene Lab (ar/vr music education) raised €130k.
P.s. I run a private tech sales community & sales education platform for spanish-speaking GTM teams called Revenue Squared. Apply here.
FINALLY somebody has simplified PMF! Thinking of starting up your own adventure? Read. This. Now. Awesome read as always! 🚀