A Product Market Fit Show | Startup Podcast for Founders
00:00:54 · S2, Pablo Srugo, Steve Tuck
[00:00:54] S2: That's Product Market Fit. Product Market Fit. Product Market Fit. I called it the Product Market Fit question. Product Market Fit. Product Market Fit. Product Market Fit. Product Market Fit. I mean, the name of the show is Product Market Fit. Ad[00:01:08] S1: Do you think the Product Market Fit show has Product Market Fit? Because if you do, then there's something you just have to do. You have to take out your phone. You have to leave the show five stars. It lets us reach more founders, and it lets us get better guests. Thank you. Steve, welcome to the show, dude. [00:01:24] S0: Oh, thank you for having me. Excited to be here. [00:01:27] S1: And you have a pretty high-fly company, it looks like. Just came off a $445 million raise in August, just last month. And if I had to describe what you do, you kind of, like, bring AWS, you bring the public cloud to on-prem, right? So my kind of framework is imagine you're, you know, a financial institution. Imagine you're a bank. You're going to have a part of your computing you're never going to build to the public cloud, but you want all the advantages of it, and you sell a physical rack, right? If I understand it, then you bring in the customer buys, installs, and it behaves similar to a public cloud. Did I get that right? Kind of at a high level? [00:02:03] S0: Yeah, that was pretty good. [00:02:04] S1: There you go.
00:02:04 · Pablo Srugo, Steve Tuck
[00:02:04] S1: There you go. [00:02:05] S0: You know, going back maybe prior to Oxide, which, like, yes, by the way, things going well, but very much an overnight success seven years in the making. There were some long, long, gritty years to be able to get through the entirety of building the product. [00:02:18] S1: So, Tommy, like, before we actually get into it, I was going to talk way more in depth about what you do and how it is that you got there. But for you, when was that moment when you felt like this model, this idea was finally working? Like, what was the initial product market fit moment for you? [00:02:31] S0: That moment was last summer, and we had some good emergent commercial success. And we kind of hit our first large multi-year contract and were faced with a build schedule that was kind of preposterous. We had a backlog now to go fill. We had to scale manufacturing and supply chain and everything. And that was exciting, but I think that was just yet another data point. And as we were trying to scale up to beat that in, you know, short order, another massive large contract landed. And we were quickly flipped from a position of how do we articulate and make sure that we're getting the message out and getting folks excited about how to think about adoption to we can't build these things fast enough. And not only are we sold out for three months, it's now looking like six months. And I think that was the moment that we knew we had it to go.
00:02:31 · Steve Tuck, Pablo Srugo
[00:02:31] S0: That moment was last summer, and we had some good emergent commercial success. And we kind of hit our first large multi-year contract and were faced with a build schedule that was kind of preposterous. We had a backlog now to go fill. We had to scale manufacturing and supply chain and everything. And that was exciting, but I think that was just yet another data point. And as we were trying to scale up to beat that in, you know, short order, another massive large contract landed. And we were quickly flipped from a position of how do we articulate and make sure that we're getting the message out and getting folks excited about how to think about adoption to we can't build these things fast enough. And not only are we sold out for three months, it's now looking like six months. And I think that was the moment that we knew we had it to go. [00:03:34] S1: I love that as the signal, like the defining feature of what product market fit is, is where your problem is not generating demand, but meeting the existing demand. Like you just said, it's like sold out, right? It happens a lot, obviously, in your case, physical products, right? But many people are selling softwares, there's no like true sold out. Like it doesn't really, but it's, that is really product market fit. Like when you're sold out, because either you don't have the inventory or in a software context, you just can't onboard the customers fast enough. You can't get into success fast enough. To me, that's like the sharpest definition of product market fit.
00:03:34 · Pablo Srugo, Steve Tuck
[00:03:34] S1: I love that as the signal, like the defining feature of what product market fit is, is where your problem is not generating demand, but meeting the existing demand. Like you just said, it's like sold out, right? It happens a lot, obviously, in your case, physical products, right? But many people are selling softwares, there's no like true sold out. Like it doesn't really, but it's, that is really product market fit. Like when you're sold out, because either you don't have the inventory or in a software context, you just can't onboard the customers fast enough. You can't get into success fast enough. To me, that's like the sharpest definition of product market fit. [00:04:05] S0: And it's not, I mean, it's not necessarily fun because we are having to delay other customers. Lead times are extending. We're having to say no to some customers while trying to build that production capacity, which you can't just turn on overnight. And this is what, you know, this is the additional challenge of doing hardware as well as software. You've got to scale these things in tandem. But it was very much the combination of doing hardware and software together that led to that moment of commercial takeoff. [00:04:35] S1: And when was this? [00:04:36] S0: So we founded Oxide in September of 2019. And this was the summer of 2025. [00:04:43] S1: Wow. Okay. [00:04:44] S0: We were a good five and a half years in. And it was four and a half years of near-death experiences. [00:04:51] S1: When they say hardware is hard, like it's those years that they're referring to.
00:04:51 · Pablo Srugo, Steve Tuck
[00:04:51] S1: When they say hardware is hard, like it's those years that they're referring to. [00:04:55] S0: And when they say hardware is hard, there's a lot of elements to that. Because yes, like hardware is hard. And you could argue that hardware today is easier than building hardware five, 10 years ago, just given a lot of the open tooling and a lot of the mechanisms that are available. But one of the most difficult aspects was getting the company booted in the first place because of hardware. Venture capitalists in 2019 did not want to invest in hardware. Cloud SaaS was the entirety of the economy. It was where the whole economy was going to go. And apparently, you could just have amnesia to the fact that all that software had to run somewhere. [00:05:31] S1: Before the SaaS apocalypse, it was B2B SaaS only. Like we only operate, by the way. Like we're black and white. It's either the best or the absolute worst.
00:05:31 · Pablo Srugo, Steve Tuck
[00:05:31] S1: Before the SaaS apocalypse, it was B2B SaaS only. Like we only operate, by the way. Like we're black and white. It's either the best or the absolute worst. [00:05:38] S0: You had to have the apocalypse. You had to have the SaaS super cycle. And it was the only thing. SaaS was the moat. So right in the midst of that era, we were going out to Sand Hill and saying, hey, we need to go raise $20 million to start the first kind of full systems computer company in America in the last 30 years. And got, you know, the treatment you would expect from career finance folks in VC. And would take us dozens and dozens and dozens of meetings to find the hard tech corner of VC. And I'll never forget, you know, the next in a litany of meetings, we go into Eclipse Ventures and sit down and you look around the room. And instead of like career finance person, career finance person, career finance person, it is all operators. It is the president of a semiconductor company. It is Pierre Lamond, the godfather of Silicon Valley. It is Lior. [00:06:31] S1: He was on the show, by the way. [00:06:33] S0: Oh, he was? [00:06:33] S1: Smart dude. Very smart dude. Yeah. [00:06:35] S0: Ah, he's fantastic. And we start talking through the importance of hardware, software, co-design brought to this industry. And we got stopped and they flashed up a slide that said 23 of the world's 25 most valuable companies do hardware and software together.