Successful startups tap into organic customer needs that already exist—a 'pull' from the market. In contrast, 'conjuring demand' involves a founder trying to convince a market of a new worldview without prior evidence. This is a much harder and less reliable path to building a business.
To determine if a startup will succeed, analyze the sequence of events. Did organic customer demand and behavior exist before the startup created its supply (product, messaging)? If the startup is trying to force motion with its supply, it's a sign of conjuring demand and a higher risk of failure.
From the outside, a startup finding organic demand and one conjuring it can use identical tactics, like creating a new category or aggressive marketing. The key difference, invisible to observers, is whether these tactics respond to an existing customer pull or attempt to create one from nothing.
Founders who have truly 'found' demand can break free from copying other startups' playbooks. They can confidently deploy unique tactics in product or marketing that seem strange to outsiders but perfectly fit their specific, proprietary understanding of customer needs, leading to outsized success.
Vanity metrics like total revenue can be misleading. A startup might acquire many low-priced, low-usage customers without solving a core problem. Deep, consistent user engagement statistics are a much stronger indicator of genuine, 'found' demand than top-line numbers alone.
When evaluating a startup, don't accept analogous trends as proof of demand. For example, Drift's pitch deck used consumer messaging growth to justify B2B marketing software. A better approach is to find direct evidence of business users already struggling with the specific project the product addresses.
Despite being led by brilliant product leaders, Drift's attempt to create the "conversational marketing" category ultimately failed to gain lasting traction. This serves as a cautionary tale: if even the smartest and most talented teams cannot successfully will a market into existence, the strategy itself is likely flawed.