How to Know If You've Found Product-Market Fit

Before spending big on growth, you should make sure you’re ready to grow.

When you have product-market fit, investment in growth acts as a multiplier. Paid ads, PR, and content will amplify what's already working. But without fit, heavy spending just burns runway. The right approach early on is to sip budget: keep spend light, focus on validation, and watch for the signals that tell you it's time to pour fuel on the fire.

The question is: how do you know when you’re ready?

Product-market fit looks different depending on what you're selling. In SaaS, for instance, high retention and low churn are key signals. In e-commerce, you might be chasing repeat purchases. In a service business, renewals and referrals will tell the story. But across most verticals and business models, the underlying pattern is basically the same.

Ask yourself these three questions—and look for real evidence, not wishful thinking:

Do People Pay?

Getting people to pay is about the right offer, the right price, and the right audience all aligning.

Even an awesome offer will flop if it’s priced too high for your segment or pitched to the wrong audience. When you’re validating fit, you’re testing all three variables: the message, the price point, and who you’re selling to.

When you can get people to pull out their wallets, that’s a sign that things are clicking. But if every deal closes only with heavy discounting or heroic relationship pulls, you’re still testing fit.

What to look for:

• You can sell consistently outside your personal network

• You're not constantly discounting or negotiating down

• Willingness-to-pay aligns with your unit economics

Do People Stay?

Getting the right people through the door matters. What matters even more is delivering enough value that they stick around.

Marketing can help by setting expectations clearly and guiding customers through onboarding or education. But ultimately, this one lives and dies with the product or service itself. NPS scoring is especially useful here, since it gives you a clear, numerical snapshot of customer sentiment.

There's another quick test for this: ask customers, "How would you feel if this went away?" If most say "very disappointed," you're onto something. If they shrug, you've got more learning to do.

What to look for:

• Stable engagement or repeat purchases

• Low churn or refund rates

• High NPS scores or strong qualitative feedback (testimonials, unsolicited praise)

Do People Talk?

When early customers start talking about you unprompted, that’s the first sign of organic pull. At the product‑market fit validation stage, the key signal is second‑degree referrals.

If friends or colleagues of your early adopters—i.e. people who haven’t interacted with anyone on your team—start showing up, that means your earliest customers felt good enough to talk about you. That’s the jump from polite satisfaction to genuine enthusiasm. 

What to look for:

• Second-degree referrals and word-of-mouth growth

• Organic inbound leads

• Mentions from customers or industry peers you didn't reach out to

Look at Fit Holistically

Even a few signals across these three areas mean you're getting close. But if one's missing, that's where you need to focus before trying to scale.

Not every gap is a sales or marketing problem. Sometimes, the offer needs to evolve. Or the product needs rethinking. And sometimes, you're just selling to the wrong customer. Finding product-market fit means looking at the whole system holistically—and not protecting sacred cows.

There's No Substitute for Talking to Customers

Dashboards and analytics are essential. So is qualitative feedback.

Talk to your customers. As often as you can. Ask why they almost didn't buy, what problem they're really solving, what would make them recommend you. Pair those qualitative insights with your analytics to see what's actually driving behaviour. One without the other gives you an incomplete picture.

The clearer your understanding of what truly matters to customers, the faster you'll find alignment.

Because once people pay, stay, and talk, you've got a market that wants you to win.