Investing mindset of top-tier Product Managers

Understanding Product Management Through an Investor's Perspective

In the realm of product management, a strategic approach akin to investment management is essential. This involves allocating resources wisely, making tough decisions based on data, and considering the long-term impact of each decision.

Ishaan Agarwal, a Senior Product Manager at Square, embodies this philosophy. Agarwal started his career in product development, gaining valuable experience through internships and roles at tech companies. His focus has always been on building user-centric products and leveraging data-driven decision making.

Balancing the Portfolio

A well-balanced product roadmap resembles an investment portfolio. Around 60% of resources should be allocated to safe, boring investments like bug fixes and customer requests. These are the foundational elements that ensure a smooth user experience.

On the other hand, around 30% of resources should be dedicated to growth plays. These are features that have the potential to significantly boost conversion and retention. They are the high-risk, high-reward investments that can propel a product to new heights.

The remaining 10% should be reserved for moonshots, the audacious and risky ideas. These are the game-changers that, if successful, can revolutionise the product landscape. However, it's crucial to remember that moonshots require careful consideration and a willingness to accept the possibility of failure.

Investing Wisely

When deciding what to build, product managers should approach the decision as an investment. They should ask themselves if a feature is a good investment, not just if it's a good feature. This question helps prioritise, make trade-offs, and consider long-term thinking.

Investors put significant emphasis on the total addressable market (TAM) when building features. A large TAM indicates a potentially lucrative market, making the feature a worthwhile investment.

Competitive advantage is another critical factor to consider. If a feature can be easily copied by competitors within two weeks, it may not be worth building unless there is a good reason.

Risk Management and Long-Term Thinking

Product management also requires a multiple time horizon approach. Managers should consider where the product is headed in the short, medium, and long term. This long-term thinking leads to building systems and platforms that compound value over time, rather than just being a feature factory.

Moreover, product managers often think about products less like engineers and more like hedge fund managers. They need to make hard calls with partial information, be willing to be wrong, and be able to adjust when necessary. Success metrics should be set before building a feature, and if they are not met, the feature should be terminated.

In summary, product management is a matter of investment strategy. It involves balancing resources, making informed decisions, and considering the long-term impact of each decision. By adopting this investment mindset, product managers can build successful, user-centric products that stand the test of time.