What is this?

<aside> 💡 "I think the biggest determinant of success tends to be the market. I’ve seen really, really good teams in terrible markets get completely crushed. I’ve also seen really bad teams in good markets do really well. So first and foremost, I care about if you’re building something interesting in a market that is large enough." Elad Gil

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When people talk about "the market" they're typically referring to the relationship between who is the customer and who are the players that serve those customers. You could get a rough sense of the size of a potential market based on the market cap of all the companies that play in a certain market. Mapping a market requires both an understanding of the problem that is being solved, the customer that has that problem, and the people solving that problem.

Introduction

The Problem to Be Solved

Related: Evaluating an Opportunity

Introduction: You need to first understand what the "problem statement" is as part of the market you're evaluating. What are people trying to accomplish? Is it a painful problem or a small annoyance? Is the solution to this problem medicine or a vitamin?

Frameworks:

• **Jobs-To-Be-Done:** A Job to be Done is the process a consumer goes through whenever they aim to change their existing life-situation into a preferred one, but cannot because there are constraints that stop them.

The Customer with the Problem

Related: Talking to Customers

Introduction: As you seek to understand your addressable market you have to understand who the real customer is. If you're selling men's underwear it doesn't make sense to say all 330M people in the US are in your "target market." You need to hone in on the aperture of what makes an "ideal customer." You want to find the balance between specific enough to really understand while broad enough to not limit potential customers.

Frameworks:

• **Ideal Customer Profile (ICP):** An ideal customer profile (ICP), commonly referred to as an ideal buyer profile, defines the perfect customer for what your organization solves for. This is a fictitious company that has all of the qualities that would make them the best fit for the solutions you provide.

The People Solving that Problem

Related: Evaluating Competition

Introduction: People will sometimes refer to this as evaluating the Industry; identifying and comparing the key players in a given market.

Frameworks:

• **Value Chain:** As you map out a number of solutions you start to see a web of relationships form. Companies interact with each other, either dependently or competitively, to satisfy what the customer needs.
• Core Competencies: When you start to segment companies into categories you can focus on their "core competency." You'll see a lot of companies claim that they can do what feels like everything. But the more digging you do and the more people you talk to the more you'll realize that most companies have a "core competency;" the thing that they're best at.