Go To Market Fit vs. Product Market Fit

Dec 28, 2022

Collin Stewart

Go to market fit (GTM) is arguably the most important factor in scaling a business. Without it, you’ll never achieve repeatable revenue growth. But once you have GTM fit and a strong sales strategy, the product almost sells itself. 

Our latest podcast guest breaks down the difference between GTM and product market fit, along with advice for each stage of the GTM journey. 

Ted Blosser is the Chief Enablement Officer (CEO) at WorkRamp, an all-in-one learning management system. He shared his top tips for determining when you’ve reached product market fit, transitioning out of founder-led sales, and building a successful outbound team.

The difference between GTM and product market fit

As a salesperson, it’s important to understand the difference between product market fit and GTM fit, as well as how to tell if your company has achieved either. If the organization you’re working for hasn’t reached GTM fit, it doesn’t matter how great of a salesperson you are–you won’t see results.

The best way to describe product market fit is that customers start pulling your product toward them, instead of you pushing it onto them. In other words, people want what you’re selling.

Go-to-market fit, on the other hand, is concerned with how you’re selling the product. Are you selling the right way to the right people? Do you have a repeatable and scalable sales process?

Most founders find that GTM and product market fit occurs around the same time, but there can be a gap between the two. At WorkRamp, they achieved product-market fit early on, while GTM fit took longer. 

WorkRamp was always an in-demand product, but in the early days, they were selling to disparate customer groups. It was hard to nail down one target market and as a result, hard to define a repeatable sales process. 

Although both product market and GTM fit are important, it was finding GTM fit that truly accelerated the business.

How to determine when you’ve reached product market fit 

When WorkRamp was founded, they were entering a large category. When Ted and his co-founder evaluated other products in the market, they found their competitors weren’t innovating, and that was a gap they could fill.

They designed WorkRamp around what customers were asking for, using technology to bring a new product to market, one with a mobile interface and multiple integrations. 

Designing your product around the market is one of the best ways to ensure product market fit; create something that people are already asking for, and seling the product will be much easier.

Go To Market Fit vs. Product Market Fit

The transition from founder-led sales

Back when WorkRamp was in the founder-led sales stage, Ted spent hours networking on LinkedIn and asking for introductions to anyone who met their buyer persona. Although he was able to generate $100-200k in pipeline each day, the process wasn’t scalable. 

The majority of sales were still coming from the founders’ personal networks and referrals, so they decided to outsource outbound sales to another company. This decision prompted them to reevaluate their go to market strategy.

The outsourced team of SDRs generated meetings, but there was an issue with lead quality. Ted began to realize that they had never given their SDRs clear directions on who the target market was; they’d outsourced the execution, without getting clear on the strategy.

Outsourcing vs. in-house SDRs

After the first outsourced attempt failed, WorkRamp decided to bring their SDR team in-house. They quickly learned that building an in-house team required a major investment in training, software, and hiring–an investment they weren’t prepared to make at the time.

Ted’s takeway from this experience was that if you can’t afford the infrastructure for an in-house team, you should outsource to an experienced partner–but only after you’ve established a clear strategy. Early-stage founders are taught to run experiments, which is great for product design, but not for sales development.

Finally, after acheiving GTM fit and making the decision to fully invest in outbound, WorkRamp started to see rapid growth.

The journey to GTM fit

Before landing on a successful go to market strategy, WorkRamp, like many startups, struggled with sales turnover. Without the right strategy in place, no rep could successfully sell the product.

So Ted and his team went back to the drawing board. They adapted their strategy, honed in on their ideal customer profile (ICP), and improved their product market fit by adding new features.

With all of those factors in place, they were able to find the right salesperson to take over. The fact that their new hire could outsell the founders was another sign they were on the path to GTM fit. 

Building your outbound sales team

One common mistake founders make is hiring reps with great sales skills, but who aren’t the right seller for that particular product or market. 

At WorkRamp, they needed a salesperson who was very process-driven, able to juggle multiple buyer personas and a short sales cycle. During the hiring process, they almost dismissed a rep who didn’t have SaaS experience; but after a roleplay-based interview, they realized that person fit their sales cycle perfectly. 

When to specialize

WorkRamp maintained full cycle salespeople until they’d reached GTM fit. When they tried to hire SDRs and BDRs too early, it wasn’t cost-effective. Instead, they waited until they’d established strong processes and reached $25-50k+ deal sizes.

This slower approach to specialization worked well because it taught the founders and AEs and take ownership of their pipeline. When they eventually expanded, the new SDRs and BDRs accelerated that success.

The future of GTM fit

With customer acquisition cost (CAC) levels on the rise, product market fit is more important than ever, especially for SaaS companies. In the future, a strong GTM strategy won’t be optional to secure startup funding–it will be the key to scaling and raising capital.

If you need help building or growing your outbound sales team, reach out here to learn how we can help. And if you’d like to connect with Ted, you can reach him on LinkedIn or at WorkRamp.com

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