Just after joining C3 AI [NYSE:AI] as its Chief Marketing Officer in 2019, Tom Siebel – Founder and CEO of C3 AI – instructed me to help build a market for a new category, “Enterprise AI”, in support of an Initial Product Offering (IPO) he was hoping to execute with C3 AI. In December, 2020, Tom was successful with that plan and C3 AI became a publicly-traded company.
Tom knew that C3 AI had strong tech, a world-class team, and billions of dollars of projected opportunity—but none of that mattered if the world (i.e., prospects, partners, analysts, stock markets) didn’t know what “Enterprise AI” was or why it should care.
Prior to C3 AI, Tom created Siebel Systems, the company that created the Customer Relationship Management (CRM) category and market before selling the company for $6B to Oracle in 2006. Tom knows that “market engineering” isn’t a function. It’s a mindset. And as CEO, he had to lead this engineering effort.
Unfortunately, few CEOs seem to understand that they must be market engineers; instead, the majority delegate this role to the CMO and Marketing. That’s a big mistake. In 2025, as it has always been, great market engineering is almost always the difference between being a market maker/leader or a commodity and the CEO must lead the effort across the entire company.
Why Most Product Launches Flop: The Market Engineering Deficit
The industry is full of elegant products that never found traction. Not because they lacked utility or technical merit—but because the teams behind them wrongly assumed that “with the right product, the market will follow.” It almost never does. Startups start out as single-product companies and more than 80% of them fail. Research shows that new products by mature enterprises fail up to 60% of the time within 5 years of their initial launch.
I call this the Market Engineering Deficit: the absence of deliberate, engineered systems to define, prime, and shape the market.
Product engineering creates the solution. Market engineering creates a receptive environment.
What’s fascinating is that most leaders spend 95% of their cycles on the former. Product is a comfort zone. We love building. Iterating. Debugging. But the rest of the world doesn’t come with a user manual—especially when you’re bringing something truly new into play. That’s why market engineering matters: it’s the process of making the unfamiliar not just recognizable, but necessary.
What Is “Market Engineering”?
Too often, “market” gets lumped into soft buckets—marketing, awareness, content ops. Important, yes. But market engineering is not the same. It’s not about branding after the fact. It’s about constructing the logic, language, and launch systems of the category before your first revenue dollar arrives.
Market Engineering is the end-to-end discipline that bridges the gulf between having an innovative solution and becoming the company that both names and leads a new space. It’s not enough to have a product or even a great narrative; you must design and continually refine both the problem frame (category) and the path by which people (the market) come to see, adopt, and champion it.
Category design gives the need its name and sets new rules, Market Engineering is different and broader. It is the operational practice of:
• Defining the problem (category) with precision and updating as reality shifts,
• Understanding and activating the audience (market) with evidence, not assumption,
• Installing repeatable playbooks and using data-driven experimentation to move from belief to traction.
Category defines the problem. Market defines the people. Market Engineering connects the two through systems, language, proof, and execution—turning insight into compounding advantage and leadership that lasts.
Many confuse category design for the full Market Engineering system; however, category design is necessary, but insufficient. Without Market Engineering, stories go untold, buyers remain unconvinced, and momentum never compounds—even if demand was possible.
Like any form of engineering, market engineering is:
- Structured, not reactive
- Based on proven frameworks (like the Traction Gap Framework I discuss in my book, Traversing the Traction Gap)
- Deployed in stages, with testing and iteration
- Designed to reduce chaos, risk, and prevent costly rework
It means thinking through:
• What category we’re leading (and why we own it)
• What narrative defines us
• Who advocates for us before we scale
• How we orchestrate demand early to prove value
• What systems we require to prevent premature scaling
Simply put: you’re not just going to market. You’re engineering the conditions for market alignment and longevity.
The Traction Gap Perspective: Why Market Engineering Must Be Milestone-Driven
If you’ve read my book or heard me speak, you know I’m the creator and biased evangelist for the Traction Gap Framework: our operating system at Traction Gap Partners. It’s how we quantify risk between initial product shipping and scalable revenue; a zone where most startups and newly launched products from enterprises stall and die.
The framework defines four key pre-revenue and post-revenue milestones:
• Minimum Viable Category (MVC)
• Minimum Viable Product (MVP)
• Minimum Viable Repeatability (MVR)
• Minimum Viable Traction (MVT)
At every one of these points, market engineering is critical:
MVC: You’re not just releasing features. You’re defining a story. A battle to win. A category space you will own. No market engineering, no Minimum Viable Category.
MVP: It’s not just “what can we build quickly”—it’s “what can we position to pull signal from the market?” An MVP that doesn’t align with a primed market dies quietly.
MVR: Now it’s about tuning the go-to-market system. Repeatability only happens when market signals are clearly designed to scale. That means playbooks, personas, advocacy loops, content orchestration—all engineering problems.
MVT: Scale comes after polish—not before. Without a precise market-engineered growth model, revenue becomes burn.
The Traction Gap Framework doesn’t just expose risk—it tells us where to invest market engineering cycles. That changes everything.
The “Enterprise AI” Playbook: How We Engineered the Market at C3 AI
Take “Enterprise AI” as a category. In 2019, it didn’t exist. There was interest in ML and predictive analytics, but nobody had defined the term, scope, or criticality of AI as a cross-enterprise platform.
At C3 AI, we didn’t just build the platform. We built the vocabulary and structure around it. We defined the key narrative: “Digital transformation requires AI at industrial scale.” Then, we lined up lighthouse customers (like Shell, the DoD, Baker Hughes, and many others) not just to buy—but to publicize.
We invested in a thought-leadership ecosystem. We built strategic partnerships with Amazon (AWS), Microsoft (Azure), and Google (Google Cloud). Tom Siebel wrote a provocative book titled, “Digital Transformation” that discussed the evolution of AI and its role in the enterprise: we distributed his book to all the CEOs of F500 companies.
We generated business and technical whitepapers, global events, and analyst briefings. We created advertising for cable news network and NPR. We built the conditions to make Enterprise AI feel inevitable. We measured and reported to the executive team the use of the term “Enterprise AI” every week. We analyzed other key non-revenue website metrics such as time-on-site, bounce rates, and our overall ranking against other companies in adjacent areas so we were confident we were establishing a market leading position prior to our IPO.
That’s market engineering in practice: create the narrative field before the tanks roll in.
What Market Engineering Means for Any Stage, Any Company
Although I biased my book, “Traversing the Traction Gap” for startups, startups aren’t the only teams that must traverse the Traction Gap. Product teams at Fortune 500 companies launching new lines? Same dynamics. Digital transformation initiatives at banks or manufacturers? You must cross the gap—from stability to uncertainty—and engineer a market around a new promise.
Private equity-backed platforms acquiring and combining features? They’re often trying to re-define markets through integration. Again, market engineering is the key to making the sum feel greater than the parts.
In short: every new product is a new market exercise. No company is exempt.
Three Market Engineering Moves Your Team Can Make This Quarter
Let’s end with pragmatism. Here are three tactics, accelerators, I recommend to anyone launching or repositioning now:
Codify Your Narrative in Market Terms – Not Product Speak Don’t pitch your features. Pitch the change you represent. Define the enemy. Define the gap. Define why this category must exist, and why you own it.
Run a Minimum Viable Category (MVC) Workshop Use the TGF as scaffolding. Ask: what companies belong inside this category with us? What words will analysts use in 12 months? Who can co-shape this with us?
Identify 3 Advocates—Before Your CAC Balloons Seek “pre-scale amplification.” Think: customers, investors, analysts, partners who can validate the market, not just the tech. Institutional trust beats advertising.
If you’re building, scaling, or even just rethinking your strategy this quarter, I invite you to adopt the market engineering lens. Don’t outsource the market. Don’t wait for product velocity to magically create demand. And don’t confuse a launch with traction.
True scale begins when you engineer the conditions to pull—not push—your product into the world.
At Traction Gap Partners, we are tried, tested and proven experts in Market Engineering. Contact us to help you engineer your market.