How to go from popular to profitable during a downturn • TechCrunch

Than harder As the financing climate begins to bite, it’s time to ditch the ‘grow at all costs’ mantra of the past decade. It’s no longer enough to educate investors about your viral user growth—they want to know how it’s affecting revenue, resilience, and careers.

The ongoing market uncertainty is a particularly loud wake-up call for founders seeking product-driven growth. The go-to-market movement pioneered by companies like Slack and Dropbox revolutionized how teams adopt and buy software. But even the best PLG products don’t propel their own viral popularity forever, and all companies eventually face a similar challenge: hiring sales teams and building a pipeline to keep growing.

As VC funding dries up, PLG startups face a particularly dangerous path. Those on the path to revenue growth have no room for error, and founders face a difficult set of challenges: which teams to deploy, when, and how to set them up for success. These decisions determine whether a PLG-driven startup sinks or swims.

I’ve spent more than two decades building, scaling, and consulting teams tasked with bringing software products to market. While it’s true that every company is different, there are a few commonalities in every go-to-market journey I’ve been a part of.

Here’s a roadmap founders can use to build on their PLG strategy and chart a path from product-driven popularity to sustained profitability.

Estimate the piece of the pie you can win now

The Serviceable Addressable Market (SAM) is where the go-to-market really begins. As the little brother of the Total Addressable Market (TAM), a number often tossed around in fundraising, the SAM is the piece of the pie you can win now. It is important to understand which market segments your product can address and which your go-to-market team can address.

To gain this understanding, here are a few questions to ask yourself:

• What characteristics do our existing customers share?
• What problems are you currently facing?
• How do they handle the introduction and purchase of software?

Invest the time to establish the criteria that define your ideal customer profile. Finding your SAM is an ongoing process, especially as your team’s and product’s capabilities expand, but achieving a clear understanding of your initial SAM is milestone #1 on your journey to market.

Qualify your best leads

Your search for the SAM should have given you a sense of how many signups you want to get, and with any luck, you’ve landed some active users. With your acquisition channels in place and up and running, the next milestone on your go-to-market journey is defining a Product Qualified Lead (PQL).