Today minimum viable product or MVP for a startup is pretty much a standard. Actually, it is a part of a big “lean startup methodology”, which is almost a whole new science itself. But let’s just focus on MVP for now.
The latest tendency shows that even giants like General Electrics apply this method. Although they call it “Fast Works”. But why is it so popular, anyway?
Well, because it works, duh… According to recent Genome report, 74% of startups fail because of premature scaling. Which means that 3 out of 4 teams work tirelessly to achieve nothing. Apparently, their idea was brilliant and the quality of a product was great. But they’ve failed due to a bad business planning. Or, what’s even worse, misguided assumption that their product will be useful for people.
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That’s the problem which lean startup methodology is supposed to solve. And building an MVP for a startup is the beating heart of this methodology.
Two ways to go
You have an outstanding idea. You want to make a spoon with a hole in it, so people could hang it anywhere or bare it on their belts. Isn’t that idea brilliant? Of course, it is dumb as hell but let me finish. Also, you’d like to enhance that spoon with some sensors to measure some qualities of food (saltness, fats, sweetness etc.). Plus it should be connected to the smartphone to analyze the data and produce some health reports. But it is kind of a secondary idea.
So you close yourself and a bunch of your friends in a workshop. You work 24/7 for six months. You work in a secrecy, so others couldn’t steal your magnificent idea.
Finally, your ingenious and game-changing product is ready. You show your spoon to the potential customers and investors. You are full of hopes and ideas for further improvements. But both investors and customers say that the hole in a spoon isn’t the best idea (actually they say that you’re nuts…). Although, they say that the idea with sensors is pretty great if only you could develop it more. But you’re broke both mentally and physically. And out of money. So you give up.
In a year or so, you read about some guy who has developed similar spoon with sensors but without that damn hole. He made millions on it. The end.
Before closing yourself and your friends in a workshop you decide to ask people. You show the spoon to them. They tell you that you’re out of your mind, but there is something in those sensors. You go back to the table, fix that hole and show the spoon again. They say that with the mobile integration it could work.
You spend 2-3 months making an MVP of your spoon with only one sensor for saltiness. Plus you have to develop an app for smartphones. It shows the quantity of salt in food and counts how much of it you have eaten in a time period. Besides, it makes a forecast about when you’ll die if you will eat it in such quantities. And again consultations: people say that you’re doing great, but that feature with death clock is too grim.
You redesign your spoon again. Add fats-sensor and customize the app respectively. Now it shows for how long you will live if you will adjust the menu properly. Consultations: great job, but more info with a better design would be better. What’s more important – some interested investors appear.
With the help of investors, you are able to hire more qualified staff. They pack your spoon with all the imaginable sensors. The spoon is released and now you make money on it. All that’s left is to enhance the app for it. Happy end.
Last made, but first planned
That’s what the Lean methodology is in a nutshell. First – you plan. Plan about:[sociallocker id=”20565″]
- whom your product will help
- what problems will it resolve
- which features are the core of the product
Now you build MVP with ONLY NECESSARY FEATURES and show it to your potential customers. Only they will tell you if your product is worth at least something, for sure. If it is not – you’ll lose a week or few on planning and few hours on asking questions.
When minimum viable product actually means “minimum”
MVP requires only core features. Period. Moreover, according to the Standish Group “Chaos” report, 60% of features are actually never used at all. Therefore those are definitely a redundancy at the beginning.
You have to decide which features are redundant and eliminate them. Now – half of what has left. After that, have a look at what you have done, cry and chop out few more features. Et voila! Somewhere there is your MVP for startup.
This method is what Eric Ries suggests in his shorthand guidance for MVP. Whether to trust him or not is up to you to decide. But if you want to build a successful product, you better trust him. And prepare for the next stage.
Iterate your MVP
Our “Lean way” example looks very promising. But, of course, it is just the best-case scenario. The reality is much worse. There is lots of job, fails, and iterations behind it.
MVP as Eric Ries states is more about the process of building a product. You’re not even obliged to develop some product. The idea itself is already an MVP of your startup. Just like with the example – go with your idea to the people and improve it first.
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Eventually, you’ll have to build some prototype anyway. And that is where the fun begins. Everyone calls this part of the development process to his own will: lean, agile, fail fast, etc.. The point is that this is an essence of a whole Lean methodology. It was designed and perfected by Eric Ries and looks like this:
After every portion of the data on your MVP – analyze it fast. Find errors, eliminate them, improve MVP, release, gather data. Your goal is to cut the necessary time. It is simple as that.
Benefits of building MVP for a startup
Aren’t those obvious yet?! Ok, on the example of that spoon let’s point out some benefits:
- Save time
- Save money
- Test the vitality of the idea (and product as well)
- Through iterations find the best and shortest way to success
- Find potential customers, early adopters and investors for your product
According to Steve Blank, startup teams often focus too much on developing the product. They perfect it for months without testing it in a real life. Consequently, lots of them fail. Only after the release, they find out that their product isn’t so appealing to people. The idea wasn’t that great from the very beginning. Or, what’s even worse, people turn on them because there was some flaw in the product. This could be a minor flaw, but people aren’t willing to give a second chance in such rapidly developing business like IT.
42% of startups stated that “lack of market need for their product” was the main reason for their failure.
Did you know that Foursquare had only check-in function and badges as the reward in its very beginning? Or that Groupon started as a single website called The Point and its goal was to find like-minded people to accomplish some tasks? And what about Spotify which was a closed beta MVP for Windows and could only stream music without fancy design and features?
All those projects were growing carefully for years. They have gone through lots of iterations before they’ve become what they are now. The study shows: startups which scale properly are growing 20 times much faster. No wonder that big players like Alaska Airlines, General Electric, Telefonica, 3M are trying to adopt the Lean methodology for themselves.
It used to be, in the 2000s, that startup teams were working in secrecy to protect their idea. They’ve been working for months or even years without showing it to anyone. But those times have passed. Today it becomes harder and harder to bring some really big idea to life without help from aside.
Also, you have to prove somehow that your potential product is vital and relevant to customers. It doesn’t matter how are you going to bring in those funds: venture capital, loans, crowd-funding. You have to show them the proof of your concept, your MVP. Besides, it is essential to know who your customers are and find early-adopters from the very beginning.
Unless your idea is really brilliant and costs a few bucks to develop. But isn’t it better to check yourself, just in case? It’s better to be safe than sorry.[/sociallocker]