Product-market fit refers to the alignment between a product and a problem that its ideal users are trying to solve, ideally in the best and easiest way possible. Achieving product-market fit is crucial for a startup's survival and growth, as it indicates that the product is compelling enough to attract and retain customers, serving as a foundation for scalable business growth. Key steps to achieve product-market fit include defining your target audience, understanding their problems and needs, identifying your unique value proposition, getting customer feedback on an early solution or minimum viable product (MVP), and iterating and pivoting as necessary.