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How to Build Product-Market Fit When Your Industry Isn’t Ready for Innovation

Most founders dream of disrupting their target market. But what happens when that market actively resists disruption? In a recent episode of Category Visionaries, Cameron Steele, CEO and co-founder of Prophia, shared how his team built a thriving AI-powered platform for commercial real estate – an industry notorious for its conservative approach to technology adoption.

Finding the Right Entry Point

When Prophia launched in 2018, they faced a fundamental challenge: how to introduce sophisticated AI technology to an industry that was still heavily reliant on manual processes. As Cameron describes, they discovered that some customers were still “going through reading leases and essentially typing in summary information into a digital form. I can’t believe this is still happening, but it is.”

Rather than trying to force revolutionary change, Prophia took a more nuanced approach. They started by addressing a critical pain point that their target market already recognized: the need for better data management. This strategic decision allowed them to introduce advanced technology without triggering resistance from potential customers.

The Power of Showing, Not Telling

Instead of building their product in isolation, Prophia implemented what Cameron calls a “design partner program.” Their approach was refreshingly practical: “We fake built it into PowerPoint, and we found about a dozen prospective customers… pitched them a few different ideas and they gave us very direct feedback on what they thought they would buy. And then went and built that thing.”

This methodology achieved two crucial objectives. First, it validated their market assumptions before investing heavily in development. Second, it created a pool of potential customers who were already invested in the product’s success. The results speak for themselves – their first paying customer from this program, who started in February 2019, remains a client today.

Adapting Technology Messaging to Market Readiness

One of the most fascinating aspects of Prophia’s GTM strategy was their initial decision to downplay their AI capabilities. As Cameron reveals, “We use AI, particularly natural language processing and machine learning, to search for, identify, and then annotate data in unstructured in documents… We didn’t really talk about that at all with our customers because they didn’t really trust that it made them nervous.”

This changed dramatically with the emergence of ChatGPT: “Then 18 months ago, chat GPT hit the mainstream and a lot of things changed. Our customers started asking us, what are you guys doing in AI?” This shift in market sentiment allowed Prophia to be more open about their technological capabilities, demonstrating how GTM messaging needs to evolve with market readiness.

Building Through Market Headwinds

Prophia’s journey hasn’t been without significant challenges. They launched their commercial product just months before COVID-19 devastated the commercial real estate market. As Cameron describes, “Our customers literally went dark on us. Our prospective customers went dark on us really March of 2020, and we had just shipped our product a couple of months prior.”

Rather than pulling back, they adapted their approach and found unexpected opportunities. The pandemic actually accelerated some aspects of digital transformation: “People got really comfortable by seeing product demos over the computer, so over Zoom and other tools, and they also got comfortable signing contracts electronically, which wasn’t necessarily the case prior to that.”

The Compound Effect of Customer Retention

Instead of chasing explosive growth, Prophia focused on building sustainable relationships with their customers. Cameron emphasizes this point clearly: “Retention is the most important metric.” This strategy has led to impressive results – they’ve only lost one customer (due to an acquisition) while growing to manage 270 million square feet of commercial real estate on their platform.

Strategic Fundraising in a Conservative Market

For founders navigating fundraising in traditional industries, Cameron advocates for targeted outreach rather than widespread pitching. His advice is pragmatic: “If people are asking about my market size, it’s a good indication for me they’re not going to underwrite to my end market… You wouldn’t go do that with a customer. You’re not just going to go pitch anybody your product.”

The key lesson from Prophia’s journey is that successful innovation in conservative markets requires patience and strategic adaptation. As Cameron puts it: “Every day, if we do just make a little incremental progress every day that compounds… Compounding is a beautiful thing investing and for companies.” This focus on steady progress rather than disruptive transformation has enabled them to build trust and drive adoption in an industry that traditionally resists change.