They are becoming startups or broken depending on the product-purchase. Right before a funding round, founders know they need to show they’re growing fast. Throwing a lot of money at sales and marketing can make the graph bend to the right as well, but does this represent real product market fit?
The team at VC fund Heading he was tired of seeing companies ride the OPM train — that’s the Other People’s Money express, right into the abyss — with nothing to show for it. So he decided to build software to get some deeper insights to determine if a company has found true product-market fit or if something else is going on.
Achieving product-market fit is no easy task. It requires a deep understanding of customer behavior, unit economics and capital efficiency.
Enter Deep diving, Headline’s new analytics tool designed to help founders navigate the complex landscape of startup growth and make data-driven decisions. The tool offers a unique approach to startup analytics. Unlike traditional business intelligence tools that focus on revenue charts, Deepdive digs deep into the metrics that really matter, giving founders a complete picture of their business, enabling them to analyze customer acquisition, retention dynamics, customer behavior expenses and much more.
“We’re going beyond surface-level revenue metrics and really focusing on understanding customer behavior and retention dynamics,” Nicolas Von Blottnitz, Headline’s vice president of Deepdive, told TechCrunch. “By segmenting customers based on their spending patterns and analyzing unit financials, founders gain a deep understanding of their business’s performance and potential.”
Deepdive’s analytics dashboards offer founders a wealth of information to inform their growth strategies. By combining data from various sources, including transaction sets, customer channels and pricing plans, Deepdive provides a comprehensive view of a business’s performance.
“We believe in responsible investment and scaling. Founders need to have a clear understanding of their product-market fit and the potential for sustainable growth,” said Thomas Gieselmann, co-founder and managing partner of Headline. “Deepdive helps founders quantify and visualize product-market fit, enabling them to make informed decisions and avoid premature scaling.”
Unlocking the value of data
Deepdive is still in its early stages, with a growing user base of founders who appreciate its value. While the tool is currently offered for free, the Headline team envisions it becoming an integral part of the startup ecosystem. They hope to create a common understanding of product-market fit and responsible scaling, ultimately benefiting founders, employees, and investors alike.
The ultimate goal is to shift the focus from pure revenue metrics to the value of each cohort. Deepdive encourages founders to prioritize product-market fit and responsible scaling, ensuring they don’t waste their most productive years in a company with no real potential.
A business model tool without a business model
It’s ironic, perhaps, that after all the talk we’ve had about business models, Deepdive itself doesn’t have one: The company doesn’t plan to market it as a separate company or charge for it.
“It really depends on our investment philosophy,” Gieselmann said. “We believe in large-scale companies when they have adapted to the product market. I feel horrible about all the memories of board meetings where I pushed the founders to put the pedal to the metal, demanding that they grow faster, before realizing that the company had no real product-market fit. I’m sorry there.”
The company emphasizes responsible investing and responsible scaling, looking to invest in a specific type of company and then paying fair market prices for its investments.
“If Deepdive ends up helping us find just one huge hit out of this, it will pay for itself many, many, many times over,” Gieselmann said, reminding us of the power of returns on the VC model. Which, I suppose, could be a valid business model for a tool.
