Jake Haynes on PMF, GTM, and Navigating the New Product Launch Landscape
Product State Q&A
Jake Haynes is the Founder of Go-to-Market BOT. He was formerly Head of Sales at WishTrip, Head of Demand Gen at Craftom, and Director of Sales + BizDev at GoFreight.
Website / LinkedIn
EC: What shift do you see in how B2B products are being launched?
JH: In the budget cuts of 2022, we all heard companies suddenly switch from ‘growth at all costs’ to ‘sustainability.’ Since then, companies have tried operating in a product limbo, trying to cut costs while expanding new growth opportunities.
This puts product leaders in a very particular situation, and the numbers are fascinating.
Only 40% of developed products make it to market, and only 60% of the 40% make a single dollar.
YET, McKinsey notes that 25% of all profits and revenues (regardless of industry) are generated from launching new products.
The bad news is that the chance of your product gaining enough traction to generate revenue is 24%.
The good news is that getting there can potentially add substantial profit to the company’s ARR.
This conundrum fascinated me, so I interviewed dozens of top product leaders to define how they navigate this shift.
As I interviewed product leaders, almost all their answers could be divided into two main reasons why a product launch is unsuccessful.
Product-market fit (PMF)
Go-to-market (GTM)
For anyone unfamiliar with these terms, product-market fit has to do with a product’s viability within a defined market. In the most basic sense, with what has been built, is there someone on the other end who will hand you money in exchange for it?
A go-to-market is how you deliver your product to your potential customer.
If the go-to-market is the vehicle, then the product-market fit is the drivetrain. The car doesn't move without the drivetrain.
There are many common mistakes that startups and scaleups make when launching products: Improper validation, poor market research, post-funding over confidence, internal disconnects, and out-innovating actual demand.
We could talk at length about product-market fit, but in my experience building GTM revenue teams, what interested me the most was how this new shift in the economy affected top product executives' actions in this new landscape of go-to-markets.
EC: What are of the main trends you you’re seeing?
JH: ‘People are more impatient than ever for a go-to-market to get validation,’ said a top product executive who has experience launching nine seven-figure products.
‘I worked with an international company that launched a GTM in the US. Within 3 months, they impatiently packed up their things and left, writing off their $340k investment.’
So management is as impatient as ever — yet product leaders seemingly have the tightest budgets ever, so what are some options to get a minimum viable product (MVP) off the ground?
3 Options:
1. Hiring Internally
Pros: More control. They are fully invested in the company.
Cons: Slow. Costly. Might have to lay off the team if the GTM flops.
2. Using Internal Salesforce
Pros: Cost-effective. Faster than hiring.
Cons: Salespeople want to stick to their main products. This requires much training, and it is hard to do at scale unless you have a large call center.
3. Outsourcing sales
Pros: Cheap. Scalable. Hands-off.
Cons: Inconsistent. Poorly trained. No investment in the product. Constant churn.
My next question naturally was: In a perfect world, what would you want?
A CRO (Ex-Uber) responded, ‘Outsourcing is still ideal for an MVP- in theory. But there needs to be an investment; a pay-for-results or something. The outsourced firm should have an obligation to provide training and collateral along with continued engagement and iteration — not set it and forget it.’
Another enterprise executive mentioned, ‘I have used a lead-gen outsourcing company at every company I have worked with to launch a new product. It’s a great way to minimize my risk. However, I have a company now that I outsource, and my revenue is stuck with them. I have to figure out over the next nine months how to get rid of them as they raise their prices on me.’
I found it surprising that nearly every company used outsourced selling/lead-gen in some capacity with a product launch; however, the idea was only optimal in theory.
EC: What’s your take on the gig economy and fractional leaders?
JH: These interviews made me create my own outsourced sales company, Go-to-Market BOT, seeking to ‘de-risk product launches’ for product leaders. However, I realized it had to start one step backward first.
First, product-market fit must be validated with the product team before anyone gets hired. It’s ‘selling before building.’
If/Once that occurs, then we hire a team on a ‘contract-to-hire’ basis.
We then train the team, build the go-to-market strategy, and operate it.
Then, if it clicks, we transfer everything and everybody to our clients, so their revenue is not dependent on us.
This model is not new; it has been around successfully for decades in the IT and public sector industries.
It is called B.O.T. for ‘build, operate, & transfer.’
We take MVPs from $0 to compounding revenue within six months.
For the companies we have worked with who have an existing product, we have been able to 2–8x their product’s revenue in under two years.
I think the ‘gig economy’ is sticking around. Characterized by short-term contracts or freelance work rather than permanent jobs, it is staying put.
It’s not just a craze but the imminent dawn of the sales workforce.
The shifting sands in hiring and layoffs are stark signs. Our revenue team recruitment methods are morphing.
Seeing more Fractional C-suite roles lately? You're not alone. Sales and marketing will be following this seismic shift.
Product and sales leaders now question why they should shoulder a full-time revenue team when the product-market fit is TBD.
Whether or not you decide to use outsourcing, it will be interesting to see exactly how these past few years will impact the trajectory of product launches & change the way companies hire revenue teams.
The market instability is clear, and the way we have been doing it is no longer sustainable.
”If the go-to-market is the vehicle, then the product-market fit is the drivetrain. The car doesn't move without the drivetrain.”
- Jake Haynes
