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Sean Ellis on how to tell if you have product/market fit

September 12, 2025

“If you can’t retain customers, you can’t grow,” Sean explains. “So validating that you have product/market fit is really critical before you get obsessive on growth hacking and trying to grow the business.”

To measure a company’s product/market fit, Sean asks users: “How would you feel if you couldn’t use this product anymore?”

After running this question across hundreds of company, Sean found that a company typically had product/market fit if about 40% of the users said they’d be very disappointed without the product.

“That question is a good leading indicator of product/market fit,” Sean says. “But the obviously more important thing is if people keep using the product. We call that a retention cohort. If you start out with 100 people using the product, and if after 30 days zero of them are still using the product, you do not have product/market fit.”

The important thing is that your retention curve flattens out and at least some percentage of signups keep using it. Where the curve flattens out will depend on the business. Sean explains:

“Calm the meditation app plateaus at only about 5% of users because they have to develop the habit of meditation, which is hard for people. Instagram plateaus at more like 50-60%. Part if it is that Instagram is free and Calm costs money… But it’s less important where it plateaus, but if [the retention curve] always goes to zero, you’re not growing; you’re just replacing. For a while you can grow, but eventually you’re going to flatten out.”