mighty capital’s thesis is that the best product wins – even more so in a downturn

When founders are laying off staff and cutting costs to face the downturn, it may seem like odd timing to tell startups to take their product as seriously as ever. In a recession, do users really care about product experience? Yes, says Mighty Capital, whose portfolio includes companies such as Airbnb and Amplitude.

The San Francisco-based VC firm has a core thesis: The best product wins. And changed macro conditions don’t invalidate it. On the contrary, Mighty Capital’s founding managing partner, SC Moatti, told TechCrunch that it is “perhaps more relevant now than ever.”

SC Moatti is a former Facebook executive with a passion for all things product. In addition to her role at Mighty Capital, she is also the founder and CEO of Products That Count, a vast network of product managers that touts the benefits of product-led growth.

Product-led growth makes all the sense in a downturn: If it’s the product itself that does the heavy lifting, it means potentially spending a lot less on sales and marketing. This makes it more likely for successful product-led companies to both grow fast and be profitable, something that investors currently love to hear.

There’s a catch, though: You can’t be product-led without a great product. However, entrepreneurs are understandably nervous about making the type of investment that this would require when their burn rate already keeps them up at night.

To understand how SC Moatti thinks about the product-versus-spending conundrum, we asked her a series of questions that founders might have if they are thinking about taking the product-led leap. Her answers follow below, edited for length and clarity.

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