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WHAT IS MVP AND WHY EVERY STARTUP NEEDS IT?

November 30, 2016
ELIZABETH TROYANOVA
Project Manager
The minimum viable product (MVP) is described by the term's inventor Eric Ries as the "version of a new product which allows a team to collect the maximum amount of validated learning about customers with the least effort". Over time the term has gotten new interpretations and is now widely used throughout various business concepts, including Lean Startup or Agile Development.

Whichever definition you prefer, every MVP must possess:

  • Enough customer value to attract clients willing to use the product and pay for it.
  • A clear vision that will make first adopters stick around.
  • The comprehensive feedback loop to direct future development.
Despite the seeming simplicity of the concept, the MVP is often confused with an unfinished or an overly simplified version of the project. In case you want to create a smartphone, your MVP is not a touchscreen, a power button, or even a processor. You should first give your customers a rotary dial phone. It can solve their problem, as it allows to communicate over distance. Later you can provide a cell phone that combines communication with mobility. And when your customers are sufficiently familiar with most features, you can present them with the smartphone.

WHY DO STARTUPS USE MVPS?

Whichever definition you prefer, every MVP must possess:

  • Your product is developed and launched within the tightest deadlines. It means that anything you don't have time for will be postponed until future product iterations.
  • New versions and iterations are finished quicker, and your customers are always content with the product's increasing quality.
  • Customer feedback allows you to concentrate on the most desired features, making your product stand out among the competition.
  • Keeping a close eye on the customer feedback makes your MVP's engagement levels rise which translates into higher sales.
  • Even if the MVP is not successful, the price of the business error is minimized. You can continue development adjusting the product for other niches or rethinking the idea completely.

HOW CAN YOU USE THE MVP TO KICK START YOUR STARTUP?

You can consider using the MVP from a variety of angles.

Your Minimum Viable Product can be a proof of concept. You should think about all the bells and whistles you want the product to have and then eliminate them one by one. In the end, you are left with a straightforward product that possesses essential features and is easy to launch. Your MVP should ultimately answer the most important question:

Does anyone need your product?

Your MVP can consist of a rough sketch on the back of a used restaurant napkin or a landing page draft or even a simple survey for potential customers. Your MVP will be unique, depending on the industry you wish to conquer, existing solutions and your resources.

Here are a few common ideas you can implement:

  • Product with a single feature (think Google Search)
  • Your product's landing page
  • Short video presentation
  • Manual service behind an online front
  • Crowdfunding campaign
Some think of creating the MVP as an endless loop. In this case, the MVP determines business credibility and development paths. You can apply this concept by constantly answering two simple questions:

  • Which of my business assumptions is most risky?
  • How can I test this assumption with minimum time and effort?
This two-question test would have helped hundreds of failed startups determine that their product was not actually needed on the market, thus saving them from wasting months developing products no one would pay for.

Let's say you decided you create an online tool that would help art studios and painters promote their works and tutorials through dedicated websites. Before plunging headfirst into work, ask yourself if artists really need websites. What if they are content with social media? You can test your first assumption by contacting local studios and talking to artists online to gauge their interest.

If you've found several interested people, ask them how much they are willing to pay. If the sum is enough for you, create draft websites for some of them. The first round of testing will determine if the artists are tech savvy enough to use the features and services you provide.

You should repeat the MVP process from developing the idea till the launch of the finished product. These two questions will keep you grounded and on the way to success.

CAN YOU SKIP THE MVP STAGE?

You've already created dozens of successful products, and you know exactly what the customers need. In this case, the MVP might be useless to you. Or maybe you have access to unlimited resources, and you are not pressed for time. If that is the case, skip the MVP and go straight to the top.

Otherwise, the MVP might be just what you need to actually get in touch with your customers and receive first payments. Even if the process of creating the MVP seems difficult, remember that it will save you time and money in the long run.

The MVP should not be your ultimate goal. It's only the first of many steps that will lead your business to success. Think about any of the modern IT giants: Google, Apple, Facebook… Every one of them started small and constantly evolved the product, taking into account customer feedback and making adjustments. That is why decades later their products are still desirable. Others, who refused to adjust and stopped at the MVP stage, are long forgotten. Or does anyone still use MySpace?

The most important lesson creating the MVP will teach you is how to balance your priorities. Minimum viable product may not be the best, most advanced version, but it provides your customers with value and keeps them coming back for more as long as you heed their feedback.
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