The Best Startup Book I Read in 2024: Falling in Love with the Problem, Not the Solution

Why do some startups thrive while others disappear? There are many reasons, but one of the common mistakes is the inability to focus at and navigate the critical phases of a startup: Product-Market Fit, establishing a Business Model, and scaling for Growth. Each phase brings unique challenges and requires a sharp focus. The best resource I found on PMF and startups is Fall in Love with the Problem, Not the Solution. This book breaks down the nuances of each phase, helping you to make educated decisions that increase your startup’s chances of success. If you want to gate a taste of it, watch Uri Levine's podcast with Lenny. By the end of it, you’ll have an understanding what you need to do to steer your startup from idea to scalable business with more confidence learnt from the shoulders of a successful serial startup founder. Below are my notes with the key phases for early B2B startups.

PMF: Finding Value for Users

Product-Market Fit is the foundation of any successful startup. Without it, even the most groundbreaking ideas will fail to gain traction—and eventually die. It’s really that simple.

What is PMF?

• Validation: Achieving PMF means proving that your product solves a real problem for a specific group of users. It’s not about intuition or gut feelings; this is measured through data only.
• User Retention: One of the strongest indicators of PMF is whether your users continue to return. Ideally, you should aim for at least 30% of them to regularly engage with your product—this shows they find ongoing value in your product.
  
• Conversion and Feedback: Another critical aspect is understanding why some users drop off after their first interaction is critical. Reaching out to these users for feedback will help you to refine your product meets their needs (or confirm they are not your target audience).

The Importance of Metrics

Your ability to succeed in this phase largely depends on the metrics you track: 

• Retention Rate: If your users aren’t coming back, it’s a clear sign you haven’t nailed PMF. Consider this metric your North Star.
  
• Cohort Analysis: The next level here is to track how different groups of users engage with your product over time. This will help you uncover patterns that signal whether you're moving in the right direction. 
• User Feedback: Don’t hesitate to connect with users who didn't return. Their insights are most valuable for pinpointing areas that need improvement and for fine-tuning your offering.

When to Move On

Knowing when to move beyond the PMF stage is as important as finding it. You’ll know you’re ready to advance to next phase when you have a core group of loyal, repeatedly coming users, and your product consistently delivers value. What is the key sign? When your first customer returns for a renewal - this is a clear indicator that you’re solving a real problem.

Business Model: Turning Value Into Revenue

How do you ensure your startup’s long-term survival? It comes down to building a sustainable business model. Once you’ve reached PMF, your next challenge is figuring out how to monetize the value you’re providing.

What is a Business Model?

• Value Capture: Your business model is how you transform the value your product delivers into revenue. A good rule of thumb is to aim for capturing between 10-25% of the value your product generates. If you’re far below this range, you may struggle to sustain your business.

  Market Considerations: It’s also important to ensure the market you’re targeting is big enough to support your revenue ambitions. Even the best product can hit a ceiling if the market is too small.

Key Metrics and Strategies

• Revenue per User: This metric tracks how much revenue each customer brings in. Monitoring this will help you understand whether your pricing is working.
• Customer Acquisition Cost (CAC) vs. Lifetime Value (LTV): Your business model needs to ensure that the lifetime value of a customer far exceeds the cost of acquiring them. Ideally, your LTV should be at least three times your CAC—this ratio is critical for long-term profitability.
• Sales Cycle Length: The shorter your sales cycles, the more efficient your business model is likely to be. Long sales cycles might indicate that your value proposition needs refining, or that it isn’t compelling enough to customers.

When to Move On

Crafting a solid business model is about more than just generating revenue—it’s about ensuring your startup can scale and succeed in the long run. Make sure you’re capturing enough value, and that your revenue streams align with your customers’ needs and behaviors.

You’ll know you’re ready to transition into the Growth phase when you’ve successfully figured out how to monetize your product, your sales cycles are streamlined, and you can predict your revenue with consistency. At this point, your focus should shift toward expanding your customer base, all while keeping a close eye on the balance between CAC and LTV.

Growth: Balancing Acquisition and Retention

During growth phase, the focus shifts from building and validating to expanding and optimizing. This phase is about ramping up user acquisition, maximizing retention, and ensuring that your business model can handle rapid expansion without faltering.

Key Metrics for Growth

• Customer Acquisition Cost (CAC): As you scale, it's crucial to keep a close eye on CAC. If your acquisition costs start to climb faster than the revenue each new customer brings in, it’s a signal that your growth strategy might need rethinking.
• Churn Rate: Minimizing churn is just as important. High churn rates are a warning that your product isn’t delivering consistent value, and that can undermine even the most aggressive growth plans.

Strategies for Sustainable Growth

To scale effectively, focus on these strategies:

• Optimize User Acquisition: Whether you’re leveraging viral loops or paid channels, acquiring users efficiently is vital. Make sure that your marketing spend is generating a healthy return.

• Enhance User Retention: Growth isn’t just about adding new users; it’s about keeping them. Invest in features and improvements that encourage long-term engagement.

• Leverage Data: Use data analytics to track user behavior and continuously fine-tune your growth strategy. By understanding which channels bring in your most valuable users, you can allocate resources more effectively.

When to Push for Aggressive Growth

Deciding when to push for aggressive growth depends on how stable your business model is and whether you can scale user acquisition and retention effectively. If your CAC is low, your retention rates are high, and you feel confident that scaling won’t compromise product quality or user experience, then it’s time to hit the gas.

Summary

What’s the ultimate goal for any startup? It’s to create sustainable value, and that requires intentional focus. Focus is everything. Moving too early or too slowly through these phases can be costly. 

• PMF: Validate that your product solves a real problem by watching user retention.
• Business Model: Ensure that you’re capturing enough value.
• Growth: Scale by balancing acquisition and retention.

Validate each step, stay data-driven, and adjust your strategy as needed. If you like this summary, follow me on twitter for similar resources, and go read the full Fall in Love with the Problem, Not the Solution. 

Good Strategy vs Bad Strategy

In the fast-paced world of software, the strategy can be the difference between success and failure. Yet, bad strategy or a lack of strategy is common. From mistaking goals for a plan to those drowning in slide decks full of vision and mission, without actionable steps, the pitfalls are everywhere. In this fascinating podcast with Lenny, Richard Rumelt highlights these critical errors, providing insight into why many organizations struggle. This summary of their podcast will delve into what are common examples of a bad strategy and provide tips on crafting good strategies.

Introduction to Strategy 

Strategy is a cohesive response designed to address significant challenges. Effective strategy entails addressing identified high-stakes challenges through a coherent mix of policy and action. It starts with a precise diagnosis of the biggest challenge faced, is followed by a guiding policy that outlines solutions, and culminates in coherent actions aimed at overcoming the challenge. So, if this defines a good strategy, one might wonder, what does a bad strategy look like?

Bad Strategy

Richard’s Good Strategy/Bad Strategy book is perhaps better known for its examples of what not to do in strategy than for its good strategic insights. Many readers find these examples strikingly relevant to their own organizational struggles. Below is a list of common strategic missteps highlighted in his work:

1. Failure to Face the Challenge: Strategies that fail to clearly identify or address the core challenges facing the organization often lead to vague objectives without actionable plans.

2. Ignoring Obstacles: Strategies that overlook significant barriers or challenges that could derail the plan often lead to unrealistic expectations and strategic failures.

3. Mistaking Goals for Strategy: Setting high-level goals, such as profit targets or market share increases, without outlining specific actions or policies to achieve these goals, confuses outcomes with strategic plans.

4. Fluff: Using jargon or buzzwords might sound impressive but often lacks clear, practical implications or actionable content. This fluff tends to obscure the absence of substantive strategy. An extension of this is the misuse of vision and mission statements as substitutes for actual strategic planning, where they are presented as strategy without underpinning actions.

5. Template-Style Strategy: Adopting generic strategies not tailored to the company’s specific circumstances can lead to misaligned efforts and wasted resources.

6. No Coherent Action Plan: Strategies that list desired outcomes without linking them to coherent, coordinated actions that can realistically achieve these outcomes.

7. The Laundry List: Crafting a strategy composed of a long list of unrelated tasks or initiatives, which lacks focus and dilutes resources, thereby making it difficult to achieve significant results in any area.

8. Neglecting Organizational Dynamics: Crafting strategies that are incompatible with the company's culture or poorly communicated, leading to resistance and misalignment.

9. Misjudging Resources and Competition: Planning based on unrealistic assumptions about resource availability and underestimating the strength and strategies of competitors.

10. Short-termism: Focusing solely on short-term gains at the expense of long-term sustainability.

Effective strategy requires a clear understanding of the competitive landscape, internal capabilities, and adaptable objectives that can respond to changing circumstances. So what is a good strategy?

Components of a Good Strategy

Diagnosis. Guiding policy. And coherent actions.

Diagnosis involves understanding the nature of the challenge that needs to be addressed. It's about pinpointing the key issue and deciding what aspects of reality to focus on to develop a strategic response. For example, a company may identify that its primary challenge is declining market share due to intensified competition from tech-savvy newcomers.

The guiding policy is the approach chosen to navigate the challenge identified during the diagnosis. It dictates how the challenge will be managed and establishes a framework for subsequent actions. A firm might decide to differentiate its product line through advanced technology and superior customer service as a policy to regain market share.

Coherent actions are the specific steps taken to implement the guiding policy and directly address the challenge identified in the diagnosis. Actions must be well-coordinated and logically consistent to be effective. An example would be developing a new series of tech-enhanced products, training customer service teams to provide exceptional service, and launching a targeted marketing campaign to highlight the unique features of these products.

The Magnifying Glass Approach

This analogy effectively illustrates the essence of strategy, especially in early startups. Imagine you are trying to light up fire using a magnifying glass. This is similar to bootstrapping a startup with initial customers.

The Magnifying Glass Analogy for Strategy

1. Power (The Sun):

• In strategy, the source of power refers to the organization's unique strengths or advantages that can be leveraged to address the challenge. This might be a technological edge, a strong brand reputation, or exclusive access to certain resources. 

2. Focus (The Magnifying Glass):

• The magnifying glass symbolizes the guiding policy within a strategy. Just as a magnifying glass focuses sunlight into a concentrated beam, the guiding policy focuses organizational resources and efforts towards a specific path. This focus ensures that all actions are aligned and aimed precisely at the challenge.

3. Target (The Black Thread Burned):

• The target in strategy is the challenge or problem identified in the diagnosis. It's the specific issue that the strategy aims to resolve or the opportunity it seeks to exploit. Just as the focused sunlight can ignite a black string faster than a huge wooden log, a well-crafted strategy directs organizational efforts to change or influence the target area effectively.

The magnifying glass analogy powerfully illustrates the critical alignment necessary in planning, emphasizing the need to synchronize power, focus, and target to effectively drive desired changes or outcomes. This analogy is particularly resonant in the context of a startup, where resources (or "power") are often limited. In such environments, directing a team's efforts towards highly specific and impactful activities can significantly amplify the effect of these limited resources, much like focusing sunlight through a magnifying glass to burn a thread rather than attempting to set ablaze a large wooden log. Similarly, in a startup, identifying and engaging the right initial user base and concentrating team efforts effectively can accelerate early growth and set the foundation for future success. 

Distinguishing Goals from Strategy

Goals such as key performance indicators (KPIs), financial targets, or personal ambitions are not strategies because they describe desired outcomes rather than defining the specific means of achieving them. In the interview, Richard provides a personal anecdote to illustrate the difference between ambitions and strategy. He mentions a list of ambitions he had when he was younger, which included desires like wanting to become a top business school professor, drive a Morgan Drophead Plus 4, learn to fly an aircraft, and marry a beautiful woman, among other things. This example highlights that while these are all valid personal ambitions, they do not constitute a strategy because they lack a clear plan for achievement that addresses specific challenges or opportunities.

Here’s why goals alone do not constitute a strategy:

• Goals do not provide a diagnosis of the underlying issues or challenges that need to be addressed. A strategy begins with a thorough understanding of the problem, which helps in crafting a focused and effective response. Without this, goals can be misaligned with the actual needs or challenges of the organization.

• Goals often state what an organization hopes to achieve (e.g., "increase revenue by 20%" or "expand market share") but do not specify the actions required to reach these outcomes. Without a clear plan detailing how these objectives will be achieved, goals remain aspirational and directionless.A strategy not only outlines what needs to be achieved but also prioritizes and sequences specific, coherent actions that are required to meet the goals within the context of the guiding policy.

• A guiding policy provides a coherent approach to overcoming the identified challenges, acting as a bridge between the diagnosis and the actions. Goals without a guiding policy lack a strategic framework to direct decision-making and resource allocation.

• Goals do not usually consider the constraints or limitations within which an organization operates. Strategies are developed by taking into account both the opportunities and the constraints, ensuring that the plans are realistic and executable.

While goals are necessary for setting direction and measuring performance, strategy is about how to get there.

Identifying and Addressing Key Problems

An effective strategy focuses on problems that are significant to the organization's success and within its capacity to address, rather than focusing on obvious-looking goals. Here what that is composed of.

Important Problems: These are challenges that have significant impact on the organization's performance or strategic direction. They are critical in that solving them would lead to substantial improvements or advantages for the organization. Importance is determined by the potential impact on the organization's objectives, such as improving market position, enhancing operational efficiency, or driving innovation.

Addressable Problems: These are challenges that the organization has the capabilities to solve or at least make significant progress on. Addressability involves having or being able to develop the necessary resources, technologies, and competencies to tackle the problem effectively. Unlike setting goals, which often describe desired end states (like "increase market share by 10%"), focusing on important and addressable problems involves a dynamic process of understanding and acting on core challenges. It's about diagnosing and then strategically responding to these challenges with coherent actions that directly tackle the issues at hand. This approach ensures that strategy is not just about hitting targets or milestones but is fundamentally about changing the conditions or dynamics that limit the organization's success.

Strategy is not about listing everything you want to accomplish; rather, it's about identifying the most pressing challenges that are blocking the path to these ambitions, and then formulating a coherent plan of action to overcome these obstacles. This requires diagnosing the real issues at hand, setting a guiding policy that addresses these issues, and then executing coherent actions that directly tackle the identified problems.

Final Thoughts

Good strategy is not easy, and bad strategy is prevalent. A well-formulated strategy is key for navigating challenges. It requires a clear understanding of the issues at hand, a well-defined guiding policy, and precise actions that are directly linked to overcoming these challenges. Just as the magnifying glass analogy teaches us to focus our power precisely on the target, so must our strategic efforts be sharply focused on the goal. To learn more about avoiding these common pitfalls and crafting effective strategies, explore Richard’s Good Strategy/Bad Strategy book.

Product-Market Fit Framework for B2B Startups

Finding product-market fit (PMF) is arguably the most critical challenge faced by startups. Navigating the path to PMF can often feel like moving through a labyrinth, with each turn posing potential setbacks or breakthroughs. The PMF framework is designed to guide startups through the various stages of validating and scaling their product in the market. It helps founders identify where they are in the product-market fit journey, what their immediate focus should be, and how to recognize if they are on the right track or if adjustments are needed. The PMF framework is divided into four distinct levels, each representing a stage in a startup's lifecycle:

1. Nascent: Focus on identifying a critical problem and delivering a solution that is deeply satisfying to a small group of customers.

2. Developing: Transition from initial traction to a scalable business model by increasing the customer base and establishing reliable demand generation processes.

3. Strong: Scale business operations efficiently while maintaining product quality that meets market demands.

4. Extreme: Achieve widespread market acceptance, continuously optimize the product offerings, and explore new market opportunities for further expansion.

The table below provides a look at each level, featuring key characteristics such as company and financial metrics, primary focus areas, benchmarks for measuring progress, and danger signals that might indicate potential issues.

Product-Market Fit Framework Summary (click to enlarge)

Navigating it means you've successfully developed a product that meets a substantial market demand and is capable of sustaining growth. Achieving PMF is not a one-time activity but an ongoing process that involves three dimensions: Satisfaction, Demand, and Efficiency. These dimensions evolve over the lifetime of a startup, each taking precedence at different stages of the company's growth. 

• Satisfaction: In the early stages, ensuring customer satisfaction is paramount. Founders must concentrate on solving a critical problem that is important and urgent for a select group of customers. This involves creating a product or service that not only addresses the problem effectively but also delivers a superior experience compared to existing solutions. As startups move to higher levels of PMF, maintaining satisfaction remains crucial but becomes part of a broader strategy that includes scaling and optimizing operations
• Demand: As a startup transitions from the nascent to the developing stage, the focus shifts towards generating and scaling demand. At this point, the product or service has been validated with an initial customer base, and the challenge becomes attracting a larger audience. This involves fine-tuning marketing strategies, diversifying channels, and increasing market outreach to capture a broader segment of potential customers. Successful demand generation is marked by an increasing customer base and the establishment of repeatable sales processes.
• Efficiency: In the later stages of PMF, particularly when a startup reaches strong and extreme levels, efficiency becomes a critical focus. At these stages, the startup must optimize its operations to handle the scaling business effectively. This includes streamlining processes, reducing costs, improving operational throughput, and leveraging technology to enhance productivity. Efficiency gains are crucial for sustaining growth at scale, managing large teams, and expanding to new markets without compromising on quality or customer satisfaction.

Focus areas during the stage in a startup's lifecycle (click to enlarge)

The PMF framework is not a roadmap; it's a diagnostic tool that helps founders make strategic decisions and pivot when necessary, ensuring they stay aligned with market needs and business objectives. Through these evolving focus areas, the PMF framework not only helps startups understand what is required at each stage but also prepares them to anticipate changes in focus as they grow.

This amazing framework was thoroughly outlined by Todd Jackson during a session on Lenny's Product Growth Podcast. Impressed by the depth and practicality of the discussion, I felt compelled to distill and document the key points to better understand and apply these principles. For a comprehensive exploration of the PMF Method and to hear from Todd Jackson himself, visit Lenny's Newsletter for the full episode. Todd's expertise and clarity in presenting this framework make it an extremely useful resource for any startup looking to navigate the complex journey to market fit.

Top 20 Must-Read Software Trends Reports for 2023

In the rapidly evolving software industry, keeping up with new trends, tools, and best practices can be time-consuming. With so much information available, where do you start, and what sources can you trust? I've curated a list of reports that I follow to stay informed and ahead of the curve. These provide insights into everything from programming languages to DevOps, cloud strategy, and security. If you're interested in the latest trends and fascinating posts I come across, follow me or check out my latest writing on industry trends over at the Diagrid blog. I share anything I find insightful and worth reading in the world of cloud and distributed systems. 

Here are the top 20 reports for 2023 I came across so far:

Report	Publisher
Programming Community Index for June 2023	TIOBE
Programming Language Rankings - January 2023	RedMonk
Developer Survey 2023	Stack Overflow
DevOps and Cloud Trends Report – July 2023	InfoQ
Software Architecture & Design Trends 2023	InfoQ
State of the API Report 2023	Postman
State of Application Security Report 2023	DataDog
Technology Radar Vol 28	Thoughtworks
Radar Trends to Watch: June 2023	O'Reilly
State of Cloud Strategy Survey 2023	HashiCorp
State of Kubernetes Security Report 2023	Red Hat
The State of Platform Engineering Report	PuppetLabs
State of Kubernetes 2023	Vmware
The State of Edge Functions 2023	Deno
State of Data 2023	AirByte
State of Data + AI 2023	Databricks
The State of Open Source Software 2022	Github
State of APIs 2022	RapidAPI
CNCF Annual Survey 2022	CNCF
State of DevOps Report 2022	Google

While these reports offer valuable insights, it's important to keep in mind that they can be opinionated. The key to effectively leveraging these resources lies in cross-verifying trends from multiple sources and using them only as a guide for direction rather than absolute truths.

Are there any reports that should be on this list? Tag me on Twitter and I'll include them, subject to my checks I'm always keen to explore new sources! Found this list helpful? Go ahead, Share it.

Call to action: Are you a Dapr user? Your experience is valuable! Contribute your insights and shape the State of Dapr Report.

Updates:

State of Database Survey by Basedash

The State of Data Engineering 2023 by lakeFS

State of Serverless Report by DataDog

The 2023 State of OSPOs and OSS Initiatives

2023 State of DevOps Report: Culture is everything

Datadog’s container reports / Nov 2023

State of AI report 2023

Octoverse 2023

State of DevRel 2023

State of Serverless by DataDog

State of AWS 2024

Life in First Principles

Let's express life through its finite ingredients. There are three resources in life that everything else depends on. Every time you waste any of them, they're gone forever. These are time, energy, and focus.

Time

Time is the one variable that nobody has any control over. There are 24 hours in a day, 365 days in a year. Time offers the same equal consistency to everybody, but at different lengths. We are born, we live, and we die. All you can do is maximise the other variables in the time given to you, in a way meaningful to you.

Energy

Being alive is a prerequisite, but not sufficient to reach happiness. Given a lifetime, to maximise your purpose and happiness, depends on your energy levels. Energy is the ability to do things, physically or mentally. Having a body sufficiently healthy that will enable you to pursue your purpose. For some, this can be a physically strong body, having a good sleep, healthy diet, and regular exercise. For others, it can be sufficient to be able to get up from the bed and hold a pen. And for some even the ability to express your thoughts through a computer device (such as Stephen Hawking). Energy levels vary from person to person, but so are the energy needs. Energy is not a "have or have not" constant like life is, it is rather a variable that tends that changes every moment, and tends to go down with age. Energy is the multiplier that lets you get the best out of the time given to you.

Focus

Being lucky to be alive, and having sufficient energy, gives the optionality to spend your attention in many ways. Focus is about how we use our time and energy in a directed way. It is the ability to concentrate our attention in a direction that makes us happy, or spread and waste in the universe in a way benefiting others or nobody.


Focus is the variable that we have most control over, and the variable that has the biggest power to change our life. Used in a purposeful way, even in short lifespan and limited energy levels, it has led to personal fulfilments, or human achievements that are remembered throughout millennials. Used purposelessly, can lead to wasted long life full of energy, and many regrets in a death bed.

The happiness formula

If time is a yes/no constant, and the energy level is a multiplier for every moment, then focus is the exponent of all. Every moment, we are alive, we have a certain energy level that we can use for something purposeful or waste for nothing. Then we have recharge again. Every moment we have the ability to focus our energy to things that matter to us, or waste it aimlessly. Life happiness is the sum of all moments we had, with sufficient energy to help us focus on things that makes us happy.

Happiness is the sum of all finite moments where
we focus our energy towards our purpose

Every time we waste these finite resources, they're gone forever. Make sure you are alive first, healthy and energised second, and also focused on what makes you happy. These variables build on top of each other and require a delicate balance. Focus too much on one thing, and you may lose your life in an instant. Ignore your health, and your energy levels will suffer hindering the ability to focus. Do everything right, and still a meteor can hit you and end it all. There is no guarantee, or fairness in any of these, only the awareness of its working. This formula is re presentation of how these finite resources can be transformed into happiness in the equation called life.

How does Knative project compare to Dapr?

How does Knative project compare to Dapr?

Both Dapr and Knative projects help create and run cloud-native applications on Kubernetes, but differ in important aspects. I thought I'd quickly share where these projects overlap and complement each other from a user point of view. If you prefer, you can read this post as a twitter thread too.

Dapr vs Knative

TLDR:
Knative extends Kubernetes with serverless containers (scaling to and from 0) and helps you connect applications declaratively. Dapr helps developers implement reliable connected distributed applications quickly. 

Community

Knative originated from Google, whereas Dapr from Microsoft. Today both projects are incubating at CNCF. Both projects have growing communities and are within top 20 active CNCF projects (Dapr #10 and Knative #17)

Community statistics

See the full CNCF project statistics here.

Primary focus area

➤Knative extends Kubernetes with serverless containers by taking care of runtine networking (sync/async), autoscaling (to/from zero), and app revision tracking.

➤Dapr helps developers create reliable connected distributed applications quickly. It doesn’t manage the lifecycle of the application, instead it runs next to the applications.

Target user

➤Knative serving can be used by Ops to auto-scale and release apps (with traffic splitting). Knative eventing and functions can be used by devs to build, deploy apps, and connect external systems and event-driven containers. 

➤Dapr is toolkit designed primarily for developers. Developers use APIs & SDKs to interact with Dapr and offload responsibilities such as: pub/sub, state access, stateful service invocation, resiliency, etc. There are design time and runtime benefits for architects and operations teams respectively as described here.

Supported platforms

➤Knative runs only on top of Kubernetes and a network layer such as Kourier, Istio, Contour.

➤Dapr can run on Kubernetes, as well as on-premises and edge devices (such as the International Space Station).

For local dev, Knative requires Kubernetes, whereas Dapr can also run on Docker, or as a single binary only.

Deployment model

Both projects have operator, helm chats, CLI that help with installation and operating the control planes on Kubernetes. 

➤On the data plane side, Dapr is a sidecar that gets injected into the application pod. The application interacts with Dapr over well-defined APIs...

➤Knative dictates how the application is defined and run on Kubernetes by creating deployments, pods, configmaps, and networking configurations. It injects a transparent sidecar into every pod to measure network activity. And has an activator to hold off requests while scaling from zero.

Developer experience

➤Knative uses Kubernetes CRDs for defining an app (called Knative Service) composed of container, configuration, revision. It also offers CRDs that can define how events (CloudEvents) flow between these services, subscribe to a broker. And functions-centric CLI.

➤Dapr offers HTTP and gRPC APIs for Service invocation, Pub/Sub, State, Workflows, Bindings, Configuration, Secrets, Distributed lock, called building blocks. Devs use an HTTP/gRPC client, or SDKs for 8+ languages to interact with the above APIs.

Operational experience

➤Knative serving helps Ops with releasing, auto-scaling, configuring services. Knative eventing with abstracting the broker. 

➤Dapr helps Ops with monitoring, securing, and increasing resiliency of services, as well as cloud infrastructure abstraction.

Top features

➤Knative Scale to 0 Autoscaling Traffic splitting App definition Pub/sub Connectors Function CLI

➤Dapr Pub/sub Service-to-service interaction with resiliency, key/value access, Actors, Connectors, Security (mTLS, Auth), Config/Secrets, Workflows, Distributed Lock APIs.

Feature overlap

The primary overlap is around pub/sub capabilities. Both projects offer async interactions between applications by abstracting the broker & using CloudEvents format. Both projects have connectors and ability to subscribe apps to the broker. 

➤Knative defines these w/ CRDs & over HTTP. 

➤Dapr supports HTTP/gRPC, using CRDs and code.

Sweet spot

➤Knative: autoscaling containers (to and from zero).

➤Dapr: event-driven and stateful service interactions.

Upcoming hot feature: 

➤Knative: function development. 

➤Dapr: workflows based orchestration.

Summary

Those are the key differences between Dapr and Knative I'm aware of.  If you know other differences, share those on the twitter thread. We @diagridio are actively working on both projects and exploring how they complement each other and integrate with the greater CNCF ecosystem.