For aspiring startup founders, it's absolutely critical to validate that your business idea meets the actual needs of your target market customers. Don't have any business ideas yet? Check out our roadmap for generating billion-dollar business ideas.
Many founders with business ideas think a finished product and real users are required before they can gather customer feedback. This means that their entire product development process is fueled by assumptions about the market need that their idea is solving.
These founder assumptions are often dead wrong, and they usually lead to lost time and money en route to a product or service that no one wants. Creating a minimum viable product (MVP) is an affordable alternative to the misguided assumptions of founders who don't do any market tests before launching their business.
But what exactly is an MVP and how can you effectively create one?
In this article, we'll explain what an MVP is and why you (or your product team) should use an MVP to gather valuable feedback from qualified customers before you build your final product.
Defining the Minimum Viable Product (MVP)
The term MVP means different things depending on how it's used.
Overhear someone say MVP in the middle of a conversation about sports? They're probably talking about the most valuable player on a team or in a league.
However, in business discussions, MVP means minimum viable product.
The term was coined by Frank Robinson, CEO of Sync Dev in the early 2000s and popularized by Steve Blank and Eric Ries as they built a movement around the lean startup method after 2008.
The MVP aligns with lean startup principles because it calls on founders to quickly and cheaply build a simplified version of their product en route to early feedback on this basic version from potential customers.
An MVP's primary goal is to test fundamental assumptions about your concept and get user feedback with the least amount of expenses and development time possible. That's a foundational principle of lean startup.
While it was originally used in reference to software development, it's relevant for any type of product management and likely on the mind of any product manager whose considering how to gather early adopters as quickly as possible.
For software products, an MVP may be an initial interface and workflows without all intended functionality built out.
For physical products, it may be renderings or rough prototypes.
No matter the type of solution, an MVP only requires mocking up the most essential set of features needed to convey the core value your business idea hopes to deliver to its target customers.
These mock ups of a basic version of your solution take the pressure off rushing the creation of an actual product.
This allows business owners and product managers to focus on customer development at the same time as they build out a strategy for their product development.
Remember, solving a real market need is what actually determines whether or not your business will succeed. Let's consider review all the benefits of this MVP-centric approach to your product development strategy.
Benefits of the MVP Approach
Pursuing an MVP strategy provides many advantages, especially for early-stage startups:
Faster time to market - Launching a basic product so you can adapt quickly.
Low development costs - An MVP requires less resources to build since it only has essential product features.
Early user feedback - Direct input from users sooner helps you refine the product before final development.
Proof of concept - An MVP can validate customer demand and willingness to pay for your idea.
Securing financing - Demonstrating traction with an MVP helps attract investors.
Adaptability - Easy to change based on user reactions, rather than being locked into a set plan.
Besides these benefits, an MVP also helps you validate or invalidate your core business premise. At the end of the day, idea validation fuels business success. Even industry titans who raised over $1B for their pre-seed round ended up failing because their business idea was not validated prior to launch. Check out the story on that here.
The biggest signal for whether your business idea is valid or invalid? Whether a qualified customer actually puts their credit card info down to buy or pre-order your MVP.
Without doing any validation work with a simple version of your product, you're just building based on instinct. That will leave you and your company bankrupt 9 out of 10 times.
With all the benefits of an MVP-centric product development model in mind, it's even more clear why this approach aligns well with the lean startup methodology of rapidly testing ideas with real customers in order to fail fast and adapt.
Components of a Strong MVP
So what makes an effective MVP that allows you to learn key lessons quickly? Here are some recommendations on the essential features you should identify when building your MVP:
1. Establish the Core Features Set
Resist cramming every possible feature into your MVP. Carefully determine the absolute minimum set of features that are integral for customers to properly evaluate your product and its key benefits. Remove nice-to-have functionality. Focus only on validating the core value proposition.
2. Map the User Workflow
Consider the end-to-end user journey and what interactions are mandatory to test your hypothesis. Build wireframes or prototypes that enable users to visualize this central workflow for providing user feedback.
3. Concentrate on User Experience
While cutting features, maintain excellent user experience design in your MVP. First impressions matter, so ensure ease of use and aesthetics reflect your brand well, even with limited functionality.
4. Set Up Analytics
Track relevant metrics so you can capture data on how users actually interact with your MVP. Analytics inform how to improve the product.
5. Launch Targeted Campaigns
Test your MVP with niche, early adopter customer segments first. Run targeted campaigns to drive evidence-based user input, rather than uncontrolled mass promotion.
6. Prepare Follow-up Surveys
Plan to immediately send user surveys after the try the MVP to capture their unfiltered feedback. Prepare customized questions to validate your unique hypotheses.
Keeping the product narrowly focused on essentials for testing key assumptions is vital for an effective MVP.
Developing a Successful MVP
How you approach your MVP development depends on your type of solution and available resources.
Here are some common MVP examples:
Manually mock up product graphics or wireframes for a service. Quick and inexpensive way to visualize product interactions for initial testing.
Create a video demonstrating product usage. Illustrates the user workflow and value proposition dynamically.
Launch a landing page outlining the product concept, benefits, and pricing. Collect email signups to gauge interest.
Limited Functionality Software
For software, build the critical in-app workflows with minimal code to simulate experience.
For physical products, use 3D printing or CAD renderings to prototype core physical aspects. Lets users trial form and function.
Setup a pre-order page describing the product value proposition and features so users can place deposits. Shows commitment.
Wizard of Oz
Manually mimic technology behind the scenes to prototype experience. For example, a human driver remotely controls an autonomous taxi during early trials.
The goal of an MVP is not perfection - just enough implementation to validate your hypothesis when put in customers' hands. When pursuing that validation, it's much better to focus on cost-effective experimentation that focuses on simulating the core user experience.
Validating Your MVP
The main goal in developing an MVP is to test fundamental business assumptions. Done right, an MVP lets you quickly validate:
Problem/solution fit - Does the MVP solve real pain points for users?
Product/market fit - Do customers enthusiastically want this product and find it valuable?
Viability of business model - Are users willing to pay according to your terms? How much?
Engagement - Do users find it easy and enjoyable to use the MVP?
Early traction - What conversion rates, metrics demonstrate traction?
Validating these assumptions quantitatively and qualitatively using data from real customer interactions with your MVP minimizes risk before you invest heavily.
Ultimately your MVP is one component within your broader customer discovery efforts.
Don't know how to position your customer discovery efforts for success? We've written a playbook on how to powerfully approach the customer discovery process here.
For now, it's important to ensure that your user testing, surveys, interviews, and analytics can yield clear validation data. If you're revealing your MVP to qualified customers, it's essential that you gather feedback that determines their buying interest and preferences.
Be objective analyzing both positive and negative signals in this regard. Don't have a lot of buying interest? It's critical to pivot as soon as meaningful customer insights from your MVP experiments confirm that there's no market need for your initial idea.
How Can MVPs Go Wrong
Developing an MVP provides valuable learning only if done right. Some common pitfalls to avoid:
Don't get caught up producing an overly complex MVP by mistakenly adding too many features. This wastes time and resources.
No Clear Hypothesis
Lack of a defined hypothesis on exactly what assumptions the MVP will validate leads to fuzzy results.
No User Outreach
Failing to actively recruit target users means you won't get sufficient, quality feedback to learn.
A poorly constructed, unpolished MVP reflects badly on your brand and won't attract real interest.
No Validation Metrics
Not defining quantitative metrics upfront to objectively measure market demand results in vague learnings.
Ignoring user feedback and failing to incorporate it into future product iterations is a wasted opportunity.
Avoid these missteps to ensure your MVP provides meaningful evidence on whether to proceed further or go back to the drawing board.
Tips for MVP Success
Here are best practices to help you develop a lean, useful MVP and leverage it for maximum learning:
Carefully determine the smallest feature set needed to test your hypothesis
Mockup visual designs to convey the look and functionality
Recruit a representative sample of target users for testing
Interact one-on-one with users for qualitative feedback
Create an automated user survey for quantitative data
Keep development costs low by leveraging available tools and resources
Set measurable metrics upfront that will validate desirable customer behavior
Analyze user reactions rapidly to determine required pivots
Iterate quickly by making changes based on empirical lessons learned
Balance speed with quality - a sloppy MVP reflects poorly
Following a lean, evidence-based approach will help you determine whether your product idea resonates before you invest significant capital and resources launching. Need help parsing the data in relation to your validation testing? Check out this blog on how our experts crunch customer discovery data.
Still unsure whether it makes sense for you to build an MVP? Let's consider some key factors.
Is an MVP Right for You?
Developing a minimum viable product isn't ideal for every scenario. Consider if creating an MVP aligns with your startup’s situation:
If you need to:
Test assumptions before further dev investment
Get feedback from real-world use
Develop insights on consumer needs
Demonstrate concept quickly
Launch on a budget
Assess product-market fit
Show traction for financing
Then an MVP approach is well-suited.
However, if you have:
A proven concept in a known market
Deep customer insights already
Plenty of development resources
A complex, multi-component product
Regulatory compliance considerations
Less need for speed and flexibility
An MVP may be less beneficial.
Assess your specific scenario, but in most cases early stage startups can gain valuable data and save time using a minimum viable product strategy.
Next Steps After Your MVP
Leveraging an MVP provides objective evidence to determine your next steps. Positive results give you the validation needed to move forward and raise financing to build the full-featured product.
However, your experimentation may reveal fundamental flaws in the product-market fit that require a pivot. In that case, incorporate your learnings into a revamped concept that better meets customer needs.
Or you may discover that while interest exists, the opportunity is not big enough to support the venture. By failing fast through an MVP, you can avoid wasting months or years building the wrong product.
No matter the outcome, systematically testing business assumptions with a minimum viable product gives entrepreneurial founders data-driven insights and confidence to make wise decisions quickly. Rapid learning, flexibility and timely course corrections are the keys to success.
Does an MVP approach fit your startup? If so, get ready to gain valuable market insights as you build, test and refine your way closer to product-market fit.
If you want expert advice on how to run idea validation research with your MVP, feel free to book a call with a member of our team here.