Product Managers Are Investors
As a product manager, you're not just responsible for shipping features or managing projects. You're an investor in your product's future.
But, many PMs don't realize this. They're stuck in delivery mode, acting more like project managers than strategic leaders.
Why? Well, many PMs come from backgrounds in analytics, consulting, or support. These roles are all about delivery - getting stuff done, meeting deadlines, ticking boxes. And while those skills are valuable, they're not enough to be a great product manager.
Let me share a quick story. Early in my PM career, I was obsessed with getting stuff done. I'd come into work each day, ready to tackle my to-do list and knock out as many tasks as possible. I thought I was killing it.
But one of my mentors pulled me aside one day and asked, "Clement, what's the ROI on all this work that you’re doing? Which of these matter… and which ones don’t?"
I was stumped. I hadn't really thought about it. I was so focused on delivery that I'd forgotten about strategy. That's when I realized I needed to start thinking like an investor.
The ROI equation
Here's the equation that changed everything for me:
ROI = Benefits / Costs
Seems simple, right? But this little formula is incredibly powerful. As a product manager, your job is to optimize this equation. No matter which initiative you’re working on, you’re always looking to increase benefits or reduce costs.
Here's how I break it down.
Benefits: This is the value you're creating. Keep in mind that you need to create value for both your customers (like time saved or problems solved) and for your business (revenue generated, market share gained). The key is to quantify these benefits as much as possible.
Costs: Keep in mind that costs aren’t about money! Costs includes time, effort, and opportunity costs. And here's a crucial point many PMs miss: risks are costs too. Every potential problem or setback has a cost associated with it.
Most PMs, especially those stuck in delivery mode, focus solely on the cost side of the equation (reducing costs and minimizing risks). They're given a scope and told to execute it as efficiently as possible.
But that's only half the equation. As a strategic PM, you need to focus just as much (if not more) on the benefits side of the equation. How can you create more value for your customers, and how can you capture more value for your business?
Even more importantly, you need to look at the equation as a whole. Sometimes, the highest ROI comes from a high-cost, high-benefit initiative. Other times, it might come from a low-cost, moderate-benefit project.
This is why PMs need to be risk-seeking, not just risk-managing. You can't just take the scope you're given. You need to create your own scopes, start new projects, and kill projects that aren't delivering the highest ROI.
Shifting from delivery to strategy
So, how do we make this shift? How do we start thinking like investors instead of delivery managers? Here are four key mindset shifts:
Focus on outcomes, not outputs
Embrace uncertainty and experimentation
Think in portfolios, not projects
Take ownership and kill bad initiatives
Let's dive into each of these.
Focus on outcomes, not outputs
As a delivery-focused PM, you might measure success by the number of features shipped or projects completed. But as an investor, you need to focus on outcomes. What actual impact are these features having on your customers and your business?
Here's an example from my own experience. At one company, we were working on a new onboarding flow for our app. The project manager in me wanted to ship it as quickly as possible.
But when I put on my investor hat, I realized we needed to slow down and ask some crucial questions:
What specific customer behavior are we trying to change with this new flow?
How will we measure success?
What's the potential ROI of this change?
By focusing on these outcomes, we ended up redesigning our approach entirely. Instead of a fancy new onboarding flow, we created a simple series of tooltips that guided customers through key actions. It took less time to build, and it had a much bigger impact on our activation rates.
Embrace uncertainty and experimentation
Delivery-focused PMs hate uncertainty. They want clear requirements, detailed specs, and predictable timelines.
But as an investor, you need to get comfortable with uncertainty. In fact, you should seek it out.
Why? Because uncertainty is where the big opportunities lie. If everything was certain, everyone would be doing it. Your job as a PM is to navigate that uncertainty and find the hidden gems.
This means embracing experimentation. Instead of big, risky projects with long timelines, break things down into small, testable hypotheses. Run experiments, gather data, and iterate quickly.
I remember working on a CRM platform for real estate agents. The delivery-focused approach would have been to build out a full suite of features based on our initial assumptions. But as an investor, I knew we needed to test our hypotheses about what agents really needed.
We set up a series of rapid experiments, testing different workflow configurations and feature sets with small groups of agents. We even shadowed some of our friendliest customers to observe their day-to-day processes.
The results were eye-opening. Our initial assumptions about the "must-have" features were way off. Agents cared less about fancy reporting and more about quick, mobile-friendly lead management. By experimenting, we built a streamlined platform that increased agent productivity by 30% and boosted our user retention by 45%. That's the power of embracing uncertainty.
Think in portfolios, not projects
Delivery-focused PMs think in terms of individual projects. They want to complete each one successfully and move on to the next. But as an investor, you need to think in terms of portfolios.
Just like a financial investor doesn't put all their money into a single stock, you shouldn't put all your resources into a single project. You need a balanced portfolio of initiatives, each with different risk/reward profiles.
Here's how I approach this:
Product bets (high risk, high reward): These are your moonshots. They might fail, but if they succeed, they could be game-changers.
Feature launches (medium risk, medium reward): These are your bread and butter. They reliably move the needle on key metrics.
Feature tweaks (low risk, low reward): These are your quick wins. They won't change the world, but they keep things moving in the right direction.
The key is to balance these different types of initiatives.
As a rough rule of thumb, aim for a balanced portfolio with approximately 20% allocated to high-risk product bets, 50% to medium-risk feature launches, and 30% to low-risk feature tweaks. This balance may vary based on your product's maturity and market conditions, but it provides a starting point for thinking holistically about your product investments.
Take ownership and kill bad initiatives
You need to be willing to kill projects that aren't performing, even if you've already invested time and resources into them.
I’ve personally had to make the tough decision to shut down upcoming feature launches that we'd spent months developing. These decisions are always painful - but when the data showed they weren't delivering the ROI we needed, the most responsible thing for me to do was to kill the feature.
By cutting our losses, we freed up resources to invest in more promising initiatives.
Multiple times, by killing off feature launches, I was then able to invest in dozens of feature tweaks that had languished in the backlog but unlocked deep repeat engagement from our customers.
Remember - you are not a project manager! Your goal is not to see every project through to completion.
Your responsibilities as a PM include ruthlessly & dispassionately deciding when to terminate a low-value project; don’t finish projects just because they’re already in progress.
Why the investor mindset matters
When we shift our perspective to that of an investor, we fundamentally change how we approach product management. We're no longer solely focused on delivery - instead, we become laser-focused on return on investment (ROI).
This shift is crucial because it forces us to consider the opportunity costs of our decisions. Every hour that our teams spend on one initiative is an hour they can't spend on something else.
As investors in our products, we need to carefully consider where to allocate our scarce resources to drive the highest possible ROI. This means looking beyond the immediate horizon of the next sprint or the next quarter. It means thinking strategically about the long-term value we're creating, both for our customers and for our business.
This perspective change has profound implications for how we work. Instead of getting caught up in the rush to ship features, we start asking deeper questions. Is this the best use of our resources right now? What's the expected return on this investment? How does this align with our long-term strategy?
Another crucial aspect of the investor mindset is the focus on learning and iteration. Smart investors don't just make an investment and forget about it - they constantly monitor performance, learn from both successes and failures, and adjust their strategy accordingly.
As product managers, we should adopt the same approach. Each initiative we undertake is an opportunity to learn more about our customers, our market, and our product. By treating our work as a series of experiments, we can continuously refine our understanding and improve our decision-making over time.
So, as investors, let’s now assess the key resource bottlenecks that we must responsibly allocate across a variety of potential initiatives.
The three key investment resources
As product managers, we have three core resources that we must responsibly allocate to nearly infinite investment opportunities: time, money, and influence.
Each of these resources is finite and valuable, and we need to deploy them thoughtfully to maximize our impact.
Time is perhaps our most precious resource. It's not just about our own time as product managers, but also the time of our cross-functional teammates - engineers, designers, marketers, and others. Every hour spent on one initiative is an hour that can't be spent on another. This makes it crucial to prioritize ruthlessly and ensure that we're focusing on the highest-impact activities.
When we think about time as an investment, we start to view our roadmap differently. Instead of trying to cram in as many features as possible, we focus on the initiatives that will yield the highest return. We become more mindful of the hidden costs of context switching and over-commitment. We start to value focus and depth over breadth and multitasking.
Money is another critical resource we need to manage wisely. This includes our product development budgets, marketing spend, and any other financial resources at our disposal. While the specific amounts may vary depending on our company and product stage, the principle remains the same: we need to ensure we're getting the best possible return on every dollar we spend.
This doesn't always mean choosing the cheapest option or being overly frugal. Sometimes, investing more upfront can lead to greater returns down the line. For example, spending extra on customer research might seem expensive in the short term, but it can save us from costly mistakes and lead to better product decisions in the long run.
Influence is our third key resource, and it's often the most overlooked. As product managers, our ability to shape decisions and priorities across the organization is a powerful asset. We can use our influence to advocate for important initiatives, align different teams around a common goal, or push back against ideas that don't serve our product's best interests.
But influence is a finite resource. If we try to weigh in on every decision or constantly push our agenda, we risk diluting our impact and losing credibility. Instead, we need to be strategic about where and how we exert our influence. This might mean choosing our battles carefully, building strong relationships across the organization, and always backing up our positions with solid data and reasoning.
When we view these resources - time, money, and influence - through the lens of an investor, we become much more intentional about how we use them. We start to ask ourselves: Are we allocating these resources in a way that maximizes our ROI? Are we spreading ourselves too thin, or are we focusing our investments where they can have the greatest impact? Are we balancing short-term gains with long-term value creation?
By treating these resources as investments rather than just inputs, we can dramatically increase our effectiveness as product managers. We become better stewards of our company's resources and more strategic in our decision-making. And ultimately, this leads to better products, happier customers, and more successful businesses.
Assessing potential ROI
To truly embrace the investor mindset, we need to rigorously assess the potential ROI of each initiative we consider. This isn't always easy - product management often deals with intangibles and long-term outcomes that can be difficult to quantify. But that doesn't mean we shouldn't try. In fact, the process of trying to quantify ROI can be incredibly valuable in itself, forcing us to clarify our thinking and challenge our assumptions.
When assessing potential ROI, there are several key areas we need to consider. First and foremost is expected value creation. We need to ask ourselves: How much value will this initiative create for our customers? Will it solve a significant pain point, open up new possibilities, or simply make their lives a little easier? And how does this translate into value for our business? Will it lead to increased revenue, improved retention, or other key metrics?
It's important to note that value creation isn't always directly monetary. Sometimes, an initiative might primarily create strategic value - for example, by differentiating us from competitors or positioning us for future opportunities. While these outcomes can be harder to quantify, they're no less important to consider.
Next, we need to look at implementation costs. This isn't just about the direct financial cost, but also the time and effort required from our teams. How many engineer-hours will this take? What about design resources? Will we need to pull in other teams like marketing or customer support? Remember, every resource we commit to one initiative is a resource we can't use elsewhere.
We also need to consider risks. What could go wrong with this initiative? How likely are those scenarios, and what would be the impact if they occurred?
This isn't about being pessimistic, but about being realistic and prepared. By identifying potential risks upfront, we can often find ways to mitigate them or at least factor them into our decision-making.
Time to value is another crucial factor. How long will it take before we start seeing returns on this investment? Some initiatives might yield quick wins, while others might be more of a slow burn. Neither is inherently better, but we need to be clear about our expectations and how they align with our overall strategy and goals.
It's also worth considering the confidence level of our estimates. Are we working with solid data, or are we making educated guesses? The more uncertain our estimates, the more we might want to factor in a "risk premium" to our calculations.
Finally, we should think about scalability and long-term potential. Will the benefits of this initiative grow over time, or are they likely to plateau? Can we leverage this work for other products or markets in the future?
By breaking down our assessment into these components, we can make more informed decisions about where to invest our resources. We move beyond gut feelings and subjective preferences to a more rigorous, data-driven approach.
This doesn't mean ignoring intuition entirely - experience and instinct still have their place - but it does mean backing up our hunches with solid analysis.
This process of ROI assessment shouldn't be a one-time event. Instead, it should be an ongoing part of our work as product managers.
We should be constantly re-evaluating our investments, learning from our successes and failures, and adjusting our approach based on new information. This iterative approach empowers us to become more accurate in our assessments over time.
Remember, the goal isn't to achieve perfect accuracy in our ROI predictions. That's simply not possible in the complex, fast-moving world of product management. Instead, the goal is to make the best possible decisions with the information we have available, and to continually refine our approach as we learn and grow.
The scientific method for product investments
As investors in our products, we should approach our work with the rigor of scientists. This means forming hypotheses, designing experiments, collecting data, and making decisions based on evidence.
Here's a series of steps that I've found helpful to guide my next steps:
Form a hypothesis: "We believe that X initiative will drive Y outcome."
Define success metrics: How will we measure whether our hypothesis is correct?
Design an experiment: What's the smallest possible test we can run to validate our hypothesis?
Collect and analyze data: Run the experiment and gather both quantitative and qualitative feedback.
Make a decision: Based on the data, should we double down, pivot, or cut our losses?
This approach helps us minimize risk while maximizing our learning. It's far better to run a small experiment and learn quickly than to invest months of effort into an initiative that ultimately fails to deliver value.
For example, instead of committing to a full redesign of our product's navigation, we might start with a hypothesis: "We believe that simplifying our navigation menu will increase customer engagement with key features."
We could then design a simple A/B test, showing the new navigation to a small percentage of customers and measuring its impact on feature usage and task completion rates.
By taking this scientific approach, we can make more informed investment decisions and continuously improve our product over time. It also helps us build a culture of experimentation and learning within our teams, which is crucial for long-term success in the fast-paced world of product development.
Balancing stakeholder expectations
One of the most challenging aspects of being a product manager is the responsibility of pushing back on low-ROI initiatives. As investors in our products, we need to be judicious with our resources and focus on the highest-impact opportunities. However, this often means saying "no" to ideas that stakeholders are passionate about.
Here are some strategies I've found effective.
Align on objectives: Before discussing specific features or initiatives, ensure all stakeholders agree on the high-level objectives for the product. This gives you a strong foundation for evaluating proposals. For example, if everyone agrees that increasing customer retention is the top priority, it becomes easier to deprioritize ideas that don't directly support this goal.
Educate on opportunity costs: Help stakeholders understand that every "yes" to one initiative is a "no" to something else. Present alternative uses for the resources they're requesting. This isn't about shooting down ideas, but about making informed tradeoffs. I often find that visualizing these tradeoffs, perhaps through a simple chart or diagram, can be incredibly powerful in these discussions.
Use data to drive decisions: Present clear, data-driven rationales for your recommendations. This shifts the conversation from opinions to objective analysis. If you've done your ROI calculations, share these with stakeholders. Even if they disagree with your conclusion, they'll appreciate the rigor of your approach.
Propose experiments: Instead of a flat "no," suggest running a small experiment to validate the idea. This shows you're open to the suggestion while maintaining a rigorous approach. It also creates a learning opportunity that can inform future decisions.
Involve stakeholders in prioritization: Use frameworks like the RICE score (Reach, Impact, Confidence, Effort) and involve stakeholders in the scoring process. This helps them see how their proposal stacks up against other initiatives. It also gives them a sense of ownership in the decision-making process.
Communicate regularly: Keep stakeholders informed about your product strategy, current priorities, and the rationale behind your decisions. Regular updates can prevent surprises and build trust. I've found that a monthly product update email or meeting can work wonders in maintaining alignment.
Not sure what this looks like in the real world? Here's an example of how this might play out.
Say that a senior executive is pushing for a feature that you believe is low-ROI (this actually happens pretty frequently, so it’s best that you’re ready for it).
We should then take this approach:
Thank them for their input and restate the agreed-upon product objectives.
Present your analysis of the proposed feature, including estimated costs, potential benefits, and risks.
Show how this feature compares to other initiatives in your prioritization framework.
Propose an alternative: "While we don't think building the full feature is the best use of our resources right now, what if we ran a quick experiment to validate the demand? We could [describe a small, low-cost test] and use the results to inform our decision."
If they insist, you might say: "I understand this is important to you. If we move forward with this, we'll need to delay [other initiative]. Are you comfortable with that trade-off?"
Remember, your job isn't to say "no" - it's to ensure the team is always working on the highest-impact initiatives. By framing the conversation around impact and using data to support your recommendations, you can manage expectations while maintaining positive relationships.
Balancing the investor mindset with customer-centric design
While thinking like an investor is crucial, we have to balance this with a strong focus on customer needs and problems. After all, the best way to drive long-term ROI is to create products that customers love and find indispensable!
Here's how to strike this balance.
Start with customer problems: Always begin your investment thesis with a clear understanding of the customer need or problem you're addressing. Use techniques like customer interviews, surveys, and observation to deeply understand customer pain points.
Quantify customer impact: When calculating ROI, include metrics that directly measure customer benefit. This could be time saved, tasks completed more efficiently, or problems solved.
Include customers in the process: Involve customers in ideation, prototyping, and testing. Their direct feedback can help validate (or invalidate) your investment hypotheses.
Map customer value to business value: Show how solving customer problems translates into business benefits. For example, improving a frustrating part of your product might lead to higher retention, which in turn drives higher lifetime value.
Prioritize customer experience: Don't sacrifice customer experience for short-term gains. A poor customer experience will ultimately hurt your ROI through lower adoption, engagement, and retention.
Measure long-term impact: Look beyond immediate metrics to understand how your investments impact customer behavior and sentiment over time.
Let's say we're considering an investment in improving our product's onboarding process. An investor-only mindset might focus solely on conversion rates and time-to-first-purchase. But a balanced approach would also consider:
Customer frustration levels during onboarding (measured through surveys or usability tests)
Time-to-value (how quickly customers accomplish their first meaningful task)
Long-term retention rates for customers who complete the new vs. old onboarding process
By considering these customer-centric metrics alongside traditional ROI calculations, we can make investment decisions that are both good for business and good for our customers.
Communicating investment decisions
As a PM-investor, your ability to communicate effectively can make or break your success. It's not just about having great ideas; it's about selling those ideas, executing on them, and proving their value
Let me walk you through my three-pronged approach to investment communication:
The proposal
The prep work
The follow-through
The formal proposal: your executive pitch
Think of this as your investor pitch deck. It's your chance to show executives that you're not just a PM, but a strategic thinker who understands the business.
Here's what I include in every formal proposal:
Problem and Opportunity Statement: Start with a clear, concise articulation of the problem you're solving and the opportunity it presents. I always back this up with data and customer insights.
Proposed Solution: Outline your solution, but don't get bogged down in technical details. Focus on how it aligns with company strategy and solves the problem you've identified.
ROI Analysis: This is where you put on your investor hat. Break down the expected costs, benefits, and timeline. Be realistic - overpromising here will come back to bite you.
Risk Assessment: Show that you've thought through potential pitfalls. I like to present this as a heat map, with mitigation strategies for high-risk areas.
Success Metrics: Define clear, measurable KPIs. These will be your north star throughout the project.
Remember, you're not just listing features. You're making a business case for why this investment will drive value for the company.
I've seen too many PMs get caught up in the "cool factor" of their ideas. Don't fall into that trap. Always tie it back to business value.
The prep work: building alignment behind the scenes
Here’s a counterintuitive fact. The success of your proposal is often determined before you ever step into the meeting room with your exes.
That's why I spend a lot of time on prep work!
Here's my playbook:
Stakeholder 1:1s: I schedule individual meetings with key stakeholders. This isn't just about presenting your idea; it's about understanding their priorities and concerns. Listen more than you talk.
Roadblock Identification: Use these conversations to sniff out potential roadblocks. Is engineering concerned about technical debt? Is sales worried about how this will affect their quotas? Knowing these concerns in advance lets you address them proactively.
Proposal Refinement: Based on these discussions, refine your proposal. I've often found that stakeholder input leads to even better ideas than what I started with.
Risk Mitigation: Look for ways to reduce risks or costs based on stakeholder feedback. Can you break the project into smaller phases? Can you leverage existing resources in a new way?
Benefit Amplification: Seek opportunities to increase the potential payoff. Maybe there's a way to solve multiple problems with one solution, or to create additional value streams you hadn't considered.
This prep work is crucial. It helps you build support, refine your proposal, and significantly increase your chances of getting the green light. Plus, it shows stakeholders that you value their input, which goes a long way in building long-term relationships.
The follow-through: proving your ROI
Here's where many PMs drop the ball. They think their job is done once the proposal is approved. But in reality, this is where the real work begins.
Here's how I approach it:
Metric Tracking: Implement systems to track the key metrics you outlined in your proposal. I like to set up automated dashboards so stakeholders can check progress anytime.
Regular Reporting: Don't wait for people to ask for updates. Proactively report on progress and ROI. I send out a brief weekly update and a more detailed monthly report.
Course Correction: If results aren't meeting expectations (and sometimes they won't), don't hide it. Develop and communicate a clear plan to get back on track. I've found that stakeholders appreciate honesty and proactiveness.
Learning and Iteration: Use what you learn to inform future investment decisions. Every project, successful or not, is an opportunity to refine your investment strategy.
This follow-through is what separates great PMs from good ones. It builds trust with stakeholders and provides valuable insights for future investments.
Plus, it reinforces your reputation as someone who doesn't just talk about ROI, but delivers it.
By mastering these three aspects of communication, you're not just pitching ideas - you're building a track record as a strategic investor in your product's future.
Remember, your goal isn't just to get approval for your ideas. It's to consistently demonstrate that you can identify, execute, and deliver on high-ROI investments for your product and company. Do this well, and you'll find yourself with more influence, more resources, and more opportunities to make a real impact.
In my experience, PMs who nail this communication strategy don't just advance their careers - they fundamentally change how their organizations think about product development.
The investor mindset in action: a real-world case study
Let's bring all of this together with a real-world example from my own experience. A few years ago, I was working on a CRM product for real estate agents. We were struggling with user engagement - agents would sign up, use the product for a few weeks, and then drop off.
The delivery-focused PM in me wanted to jump straight into building new features. More features must mean more engagement, right?
But when I put on my investor hat, I realized we needed a different approach. So, here were the steps that my team and I took to address the problem of user engagement.
1) Focus on Outcomes, Not Outputs: Instead of measuring success by the number of features shipped, we defined clear outcome metrics.
7-day retention rate
Average number of leads managed per agent
Net Promoter Score (NPS)
2) Embrace Uncertainty and Experimentation: We didn't assume we knew what would improve these metrics. Instead, we set up a series of experiments:
A/B tests on the onboarding flow
Customer interviews to understand pain points
Small feature tweaks to reduce friction
3) Think in Portfolios, Not Projects: We balanced our initiatives into the three buckets below
High-risk: A complete redesign of the lead management interface
Medium-risk: Integration with a popular real estate listing platform
Low-risk: Performance optimizations to speed up page load times
4) Invest Resources Wisely
Time: We dedicated 20% of our sprint capacity to experimentation and learning
Money: We invested in better analytics tools to measure customer behavior
Influence: I convinced our sales team to delay new feature promises so we could focus on engagement
After three months, here's what we saw:
7-day retention increased from 60% to 75%
Average leads managed per agent went up by 40%
NPS improved from +15 to +45
But here's the kicker: we achieved this without building a single major new feature. Instead, we made lots of small, data-driven improvements based on our experiments.
The big redesign we were initially planning? We scrapped it. Our experiments showed that agents didn't need a fancy new interface - they needed faster load times and better integration with their existing tools.
This experience drove home for me the power of the investor mindset. By focusing on outcomes, embracing experimentation, and thoughtfully allocating our resources, we delivered far more value than we would have with a traditional feature-focused approach.
Overcoming challenges: when the investor mindset meets reality
Now, I know some of you are thinking, "That sounds great, Clement, but my company doesn't work that way. We have roadmaps to follow and deadlines to meet!"
I get it. The real world is messy, and shifting to an investor mindset isn't always easy. Here are some common challenges you might face, and how to overcome them:
Pressure to deliver features
Challenge: Your stakeholders or customers are demanding specific features, and there's pressure to just "build the thing."
Solution: Reframe the conversation around outcomes.
Instead of saying "no" to a feature request, ask "what problem are we trying to solve?" Then, propose experiments to test different solutions to that problem.
Lack of data
Challenge: You don't have the data you need to make informed investment decisions.
Solution: Start small. Identify the most critical metrics for your product and focus on measuring those.
If you lack access to formal analytics, get creative: use the product yourself or sit with friendly customers to manually measure their workflows.
Then, gradually build out your analytics capabilities over time. Remember, some data—even if it's manual or small-scale—is better than no data.
Risk-averse culture
Challenge: Your company culture doesn't support experimentation or risk-taking.
Solution: Start with low-risk, high-reward experiments to build credibility.
Share successes widely, and be transparent about failures and what you learned from them. Over time, you can shift the culture towards embracing smart risks.
Short-term thinking
Challenge: Your company is focused on short-term gains at the expense of long-term value.
Solution: Use data to make the case for long-term thinking.
Show how short-term focus is hurting key metrics over time. Propose a balanced approach that delivers quick wins while also investing in longer-term initiatives.
Limited resources
Challenge: You don't have the time, money, or people to run experiments or try new approaches.
Solution: Start by optimizing your team’s current processes.
Look for ways to free up resources by eliminating low-value activities. Then, reinvest those resources into high-potential experiments.
Remember, shifting to an investor mindset is a journey, not a destination. You don't have to change everything overnight.
Start small, build momentum, and gradually expand your influence.
Becoming a strategic product investor
So, you're convinced that thinking like an investor is the way to go. How do you level up your skills and truly become a strategic product investor?
Here are three concrete steps you can take:
Develop financial acumen
Expand your influence
Learn “systems thinking”
I’ll keep these steps short and sweet. In theory we could do more than these… but in practice, our time is limited!
Develop financial acumen
As a product investor, you need to understand the financial side of your business. Take time to learn about:
Key financial metrics (CAC, LTV, ARR, etc.)
How your company makes money
The unit economics of your product
This knowledge will help you make better investment decisions and communicate more effectively with executives.
Expand your influence
Work on your soft skills to increase your sphere of influence:
Practice clear, compelling communication
Build relationships across different departments
Learn to navigate organizational politics effectively
Remember, your ability to influence is one of your most valuable assets as a product investor.
Learn systems thinking
Great investors understand how different parts of a system interact. In product management, this means:
Understanding how changes in one area of your product affect others
Considering second-order and third-order effects of your decisions
Thinking about your product in the context of the larger market ecosystem
Cultivating this holistic perspective will help you make wiser investment decisions.
Putting it all together
We've covered a lot of ground, from the basic mindset shifts to specific strategies for thinking like an investor. Now, let's put it all together into an action plan you can start implementing right away!
Here are the six steps to take:
Audit your current approach
Define your portfolio strategy
Set up your experimentation framework
Implement regular portfolio reviews
Communicate like an investor
Build your support network
Let’s quickly break down each of these steps. And, don’t overwhelm yourself by attempting to implement all of these steps at once.
Instead, every month or so, try to do one or these steps.
You’ll see the gains slowly compound over time - just like how investors compound their winning strategies!
Audit your current approach
Before you can change, you need to know where you stand. Take a hard look at how you're currently managing your product:
Are you focused more on outputs (features shipped) or outcomes (value created)?
How do you make decisions about where to invest your resources?
Are you running experiments, or just executing on a predefined roadmap?
Be honest with yourself. This audit will help you identify where you need to focus your efforts.
Define your portfolio strategy
Just like a financial investor, you need a clear strategy for your product portfolio:
What's your risk tolerance? How will you balance high-risk, high-reward initiatives with safer bets?
What are your key areas of focus? Are you investing in acquisition, retention, monetization, or something else?
How will you measure success? Define your north star metric and supporting metrics.
Write this down and share it with your team. A clear strategy will guide all your future investment decisions.
Set up your experimentation framework
You can't be a good investor without data. Set up a system for running regular experiments:
Define your experimentation process (hypothesis formation, test design, analysis)
Allocate a portion of your resources (time and engineering capacity) specifically for experiments
Start small if you need to, but make experimentation a regular part of your workflow.
Implement regular portfolio reviews
Set up a cadence for reviewing your product portfolio:
Weekly: Quick check-in on key metrics
Monthly: Deeper dive into ongoing initiatives and experiments
Quarterly: Full portfolio review and strategy adjustment
Use these reviews to make decisions about where to double down, where to pivot, and where to cut your losses.
Communicate like an investor
Start changing the conversation with your stakeholders:
Instead of feature lists, present investment opportunities
Frame discussions around expected ROI
Share regular updates on how your "portfolio" is performing
This framing will help shift the entire organization towards an investment mindset.
Build your support network
You don't have to do this alone!
Find a mentor who thinks like an investor
Use your professional development budget to get 1:1 coaching
Build relationships with other "investors" in your organization, whether they’re in product management or in other departments
Having a support network will help you stay motivated and provide valuable perspectives!
Closing thoughts
Shifting our mindset from "feature shippers" to "product investors" can dramatically improve our effectiveness as product managers. It forces us to think more critically about how we allocate our limited resources, and it helps us focus on driving meaningful outcomes rather than just shipping features.
As you tackle your next set of product decisions, I encourage you to put on your investor hat.
Ask yourself: "If this were my money, would I invest it here? What's the potential upside? What are the risks? Is this truly the best use of our resources?"
By approaching our work with this level of rigor, we can create significantly more value for our customers, our businesses, and ultimately, for ourselves as product leaders.
The goal isn't to become a financial analyst; instead, it's to make more intentional, data-informed decisions about where to focus your team's efforts.
As you apply these principles in your work, you'll likely find that they not only improve your product outcomes but also enhance your strategic influence within your organization. By consistently demonstrating a thoughtful, ROI-focused approach to product decisions, you'll build credibility with both business stakeholders and your development teams.
Ultimately, thinking like an investor is about being a good steward of your company's resources and your customers' trust. It's about making deliberate choices that create sustainable, long-term value.
As you master this mindset, you'll be well-positioned to drive meaningful impact and grow as a product leader!
Thank you to Pauli Bielewicz, Mary Paschentis, Goutham Budati, Markus Seebauer, Juliet Chuang, and Kendra Ritterhern for making this guide possible.
