Startups succeed by solving real problems, not by filing forms. In the early stages, focus on startup product-market fit.

Excitement is in the air. You have just founded a new company, and you and your co-founders set to work. What do you need to do?

Register your company, set up a web page, register a domain, set up your company email, get an accounting tool, and design a logo.

The to-do list is endless.

All fine and good. But do you make money with all those administrative tasks? Let’s put it that way: You don’t make money if you focus on administrative tasks too early, but if your company grows you will end up in chaos without administrative processes, which will lose you money.

But let’s get back to the early days of a company.

1. Finding Product-Market Fit

When you start a new company, you will do so with a firm product idea in your head. Maybe you already have a potential launch customer, maybe you already have some first leads. But in most cases, entrepreneurs will start with a product idea in their heads, untested by the market.

The lifecycle of a new company starts with all odds against it. Either you offer a product that directly competes with existing products, putting you at a disadvantage. Or you offer a product so new and unseen that adoption in the market is slow and painful.

As the Founder & CEO of Yonder, I remember being laughed at at a trade show, hearing that the product we started building would never work in the market.

Not nice. Are we doing something wrong, or did we just run into somebody who doesn’t know what he or she is talking about? Go back, research, discuss, improve.

A few improvement cycles down the road, your product will not look the same as that first idea that floated in your head when you started the company.

In my view, the best example of a product morphing into product-market fit is the Apple Watch. Originally designed to “have your emails on your wrist”, product-market fit was found as a fitness tracker and health device.

2. Product Consolidation

Fast-forward a few years. Your company has now amassed a considerable amount of customers. Although they all bought the same product, their use cases might differ slightly: Your early customers might still demand privileges and extra features, and later customers might never have known the original product. Product consolidation is hard work, as you need to remove the extremes in your product without upsetting your customers too much.

Besides functional consolidation, your product will also need technical consolidation. In IT, we speak of refactoring — doing the same thing better, more efficient, and less error-prone.

Functional and technical product consolidation often go hand-in-hand, as some bugs reported by your customers can be solved for good by refactoring.

3. Product Scaling

Fast-forward another few years. Your product is stable and consolidated, and at some point, you will start thinking about the long-term growth perspectives for your product.

Will you be able to sell your product as a stand-alone product in the future, or will you need to join a bigger platform to accelerate growth?

Do customers want to integrate your product into theirs, and you will need to develop an SDK?

Or is it enough to interface with a few other products your customers use?

Conclusion

All those questions are product questions. If you don’t want to engage in product discussions, don’t start a company.

Founders should spend 99% of their time on product questions.