How Forethought AI Achieved Product-Market Fit

Build Mode Podcast: Forethought AI's Customer-Centric Approach

The inaugural episode of the Build Mode podcast features Isabelle Johannessen interviewing Deon Nicholas, co-founder of Forethought AI. They discuss the essential elements of constructing a durable company, prioritizing customers from the very beginning.

A Look Behind the Scenes of Startup Development

Build Mode, TechCrunch’s latest podcast, offers an unvarnished perspective on the startup creation process. It delves into the practical, often chaotic, realities of building a business. Season 1, titled "Product, Meet Market," extends beyond simply achieving product-market fit.

It explores all facets of getting a product into the hands of customers, encompassing audience identification, trust-building, and converting initial success into sustained growth.

Prioritizing Customer Needs Over Hype

From its inception, Forethought AI and its team concentrated on resolving genuine issues, rather than pursuing fleeting trends or inflated company valuations. Nicholas strongly advocates that founder confidence should originate from customers, not venture capitalists.

He believes that delivering demonstrable value to actual users will naturally attract attention and justify valuations.

Embracing Iteration: The "7-Failure Rule"

Nicholas introduced his “7-Failure Rule,” encouraging founders to prioritize iterative development over striving for immediate perfection. This principle acknowledges that multiple attempts are often necessary before discovering a truly effective solution.

Lean Operations and Customer Focus

The Forethought team maintained a streamlined structure, meticulously defined its ideal customer profile, and remained intensely focused on addressing real customer pain points. They avoided prioritizing superficial features.

Nicholas emphasizes that initial users may not explicitly articulate what isn't working, requiring founders to interpret subtle cues and feedback.

TechCrunch Disrupt 2018 Breakthrough

This approach propelled Forethought’s success at TechCrunch Disrupt 2018, culminating in winning the Startup Battlefield competition. The period leading up to the event was described as a “friendly pressure cooker,” with the team focused on securing commitments from paying customers.

This dedication resulted in heightened investor interest, a $9 million Series A funding round, and a significant contribution to the burgeoning AI landscape.

Sustained Success Through Focus

Despite rapid investor interest, Nicholas attributes the company’s long-term viability to its unwavering focus, rather than impulsive reactions. He asserts that startup success isn’t driven by hype or charismatic leadership.

Instead, it’s about creating a product that customers genuinely appreciate and continue to use.

Key Takeaways for Founders

The central message for founders is straightforward: prioritize customer involvement from the outset, validate every decision with user feedback, and resist distractions from valuations or industry buzz. Achieving product-market fit isn’t about flawlessness.

It’s about consistently demonstrating value to those who matter most – your customers.

New episodes of Build Mode are released every Thursday. Subscribe on Apple Podcasts, Spotify, or your preferred podcast platform. Video versions are also available on TechCrunch’s YouTube channel.