Product‑market fit signals
The quantitative and qualitative markers that separate traction from wishful thinking.
The retention cliff
Cohort retention flattening above 40% at week 8 is the canonical signal. Below 20% and you are still searching. Between 20–40% you have a leaky bucket worth patching. Measure by weekly active cohorts, not vanity DAU.
Word‑of‑mouth velocity
Organic sign‑ups growing faster than paid. NPS above 40. Users sending unsolicited “I showed this to my team” emails. When your top‑of‑funnel is dominated by direct and referral traffic, the product is pulling itself forward.
The “must‑have” test
Sean Ellis’s survey: “How would you feel if you could no longer use the product?” Target ≥40% answering “very disappointed.” Run it against active users, not sign‑ups. Below 25% and you have a vitamin, not a painkiller.
Expansion revenue
Existing accounts growing spend without sales intervention. Net dollar retention above 120%. Usage‑based pricing that compounds as customers deepen adoption. If your best logos flatline after month three, the wedge is too shallow.
Time‑to‑value compression
New users hitting the “aha moment” in under 7 minutes. Activation rate above 60%. If onboarding requires a sales call or a 40‑page wiki, you are selling enterprise software, not product‑market fit.
Meridian note: These signals are lagging indicators. The leading indicator is founder intuition sharpened by 100+ customer conversations. Trust the conversations first, dashboards second.