This week, we’re sharing the latest installment in our Paths to Product Market Fit series, this time with the GTM powertool Clay.
Clay’s Path to Product-Market Fit — A 7-Year “Overnight Success”
Sometimes, getting the right messaging for your startup is more challenging than getting to the right product itself.
Consider this fresh (just shipped today) example from Clay:
We built Clay to help businesses grow. We make tools that help growth marketers and rev-ops teams dramatically improve their customer research – and use that to scale their outreach. Customers can use Clay to query over 75+ data enrichment tools in one credit-based marketplace and aggregate the results, which often triples coverage and accuracy. Then, they can use our AI research agent to replace any manual research task. Finally, once they have a strong data foundation, customers can use our AI message writing feature to help them automatically craft relevant, personalized messages to each prospect.
Today, the company shared it has raised a $46M Series B round to help more GTM teams do just that, as they’ve passed 100K users and nabbed 2500+ customers (including Anthropic, Intercom, Notion, Vanta, and Verkada). But the journey to getting to these impressive milestones and this crisp framing of who they’re for and what they do was a longer one.
Founded in 2017, the Clay team spent six years quietly plugging away before experiencing an explosion of customer and revenue growth in the last 18 months. (To underscore just how meteoric the rise has been, the startup was still close to $0 in revenue as recently as spring 2022.) But if you fast forward over the years of wandering — like many founding startup tales often do — on the surface it seems like a classic "overnight success" story.
The years-long roadblock wasn’t because Clay didn’t have a market to target — it was that they had too many potential ICPs to pursue. Committing to one customer and resisting the urge to horizontally build was a multi-year learning journey. (This example below of how their positioning has evolved is one of our favorite before and afters.)
Co-founder Kareem Amin is one of the most thoughtful builders we know, so we were thrilled to get the chance to dig more deeply into his takeaways from Clay’s path to product-market fit.
“When you're an early startup team, one of your strengths is that you're malleable,” Amin says. ”A prospect can say, 'Oh, could you guys do this?', or 'Are you guys this?' And then you can become that, quite easily. What I’ve learned is that you have to know when to be malleable.”
In the latest installment of our Paths to PMF series, Amin drills into the debate between building a horizontal vs. vertical product. Along the way, he recounts all his lessons learned, from to the “spiral” many early-stage founders face when staring down committing to an initial ICP and the micro-habits he nurtures to remain hyper-focused as a second-time founder.
Founders, product leaders and marketers alike will have plenty to learn from Clay’s meandering journey to find its perfect customer, and from methodical and introspective approach Amin brings to company-building. (If you prefer to listen, check out the audio version of our interview here.)
Thanks, as always, for reading and sharing.
-The Review Editors
Recommended resources:
-Common early-stage fundraising mistakes, and how to avoid them (featuring some advice from First Round’s own Meka Asonye)
-Five simple questions to ask before launching a brand announcement
-Maven founder Gagan Biyani on the three critical decisions that led to massive breakthroughs in growth