Five Strategic Product and Tech Questions for Investors to Assess Commercial Viability

Based on patterns observed across multiple technical due diligence reports, these questions target the intersection of product capabilities and commercial viability. They reveal fundamental issues that often remain hidden in standard financial diligence but can significantly impact growth trajectory and investment returns.

1. What are your cohort-based retention metrics, and how do they compare to industry benchmarks for your specific vertical?

Why it matters: Retention is the ultimate validation of product-market fit and a leading indicator of sustainable growth. Different industries have vastly different benchmark retention curves (e.g., B2B SaaS should have 80%+ annual retention, while consumer apps might consider 30%+ monthly retention strong).

Follow-up questions:

• How do you define an "active user" for retention calculations?
• What specific product behaviors correlate most strongly with retained customers?
• What's your unit economics calculation for customer acquisition cost versus lifetime value?

2. What percentage of your engineering resources is dedicated to customer-requested features versus your product vision, and what's your process for balancing these priorities?

Why it matters: Companies with weak product leadership often become "feature factories" building whatever customers request, creating unmaintainable products with poor strategic differentiation. Conversely, companies that ignore customer needs risk building technically elegant products nobody wants.

Follow-up questions:

• How do you validate feature requests before committing resources?
• What percentage of developed features are regularly used by >20% of your customers?
• Can you share examples of requested features you declined to build and why?

3. What are your key platform scalability metrics, and at what growth thresholds will you need to make significant architecture changes?

Why it matters: Many startups build for current scale with minimal consideration for future growth requirements. Understanding scaling breakpoints helps investors assess whether the company can handle increased demand without requiring costly rewrites that stall growth.

Follow-up questions:

• What's your current database architecture and when will it need to change?
• How are your infrastructure costs changing relative to customer growth?
• What technical debt have you intentionally taken on, and what's your plan to address it?

4. How do you measure and optimize your product's time-to-value for new customers?

Why it matters: The speed at which customers realize value dramatically impacts conversion rates, early retention, and word-of-mouth growth. Companies that understand and optimize this metric typically show stronger commercial performance.

Follow-up questions:

• What specific product metrics do you track during customer onboarding?
• What percentage of customers achieve their first "success moment" within their first session?
• How has your onboarding optimization affected conversion and early retention?

5. What's your strategy for maintaining your technical competitive advantage as your market matures?

Why it matters: Many startups gain early traction through technical innovation, but without a strategy for continuous differentiation, they risk commoditization as competitors catch up. Understanding this strategy helps assess long-term sustainability.

Follow-up questions:

• What proprietary data assets or network effects does your product generate?
• How do you balance innovation with maintaining existing features and infrastructure?
• What investments are you making in R&D for capabilities 12-24 months ahead of current market needs?

These questions focus on the intersection of product, technology, and commercial outcomes rather than purely technical implementation details. They help investors quickly assess whether a company has the foundation for sustainable growth and market leadership, while revealing potential risks that might not appear in standard financial due diligence.

‍