What is a Minimum Viable Product and why does your startup need one?
First-time entrepreneurs, as well as those with a portfolio, need an MVP for their projects, it is especially important when creating a digital startup. But what is an MVP when it comes to software? An MVP is an approach that allows a founder to test business ideas with minimal costs.
What is an MVP?
We can define what a Minimum Viable Product is in a few easy to understand points:
- An MVP helps you work out the core features of your product and create a design that is both attractive and works to solve the problems of your customers.
- For entrepreneurs, an MVP is a fast and budget-friendly way to test and research your original hypothesis and product. It gets you ready to attract your first paying customers
The core features
Creating an MVP app allows a business to identify the strong and weak points of its business model. It also allows a company to test the market and see if customers would be willing to pay for and are interested in their product.
Why do you need an MVP?
Less fantasy, more analysis
Many business hypotheses look convincing on paper and this leads the vast majority of founders to mistakenly focus on digital product development, with little to no regard as to how their product will be received in the real world.
The only person who should really approve your startup is your customer. It doesn’t matter how many fans share your vision, all that really matters is whether people are willing to pay to use your app.
In that sense, an MVP keeps things together. Your product has to be representative of your brand, with a light interface and helpful features. An MVP is a cheap and fast way to make sure you are creating a worthwhile product.
The benefits of an MVP
The secret to budget-saving is to focus on a particular pain. When you do this you receive the following benefits:
- Minimizes spending. Simple business logic means easy development and the money you save can be put towards promoting your product.
- Helps validate your idea. Before even starting the development process, a company must undertake in-depth market research but an MVP allows you to continually validate the strength of your product.
- Increases the speed of adaptation. Fast changes are the strongest point for any MVP, they allow for quick adaptation and flexibility, ensuring the product is something consumers both need and love. An MVP also allows you to keep refining your product through constant feedback, helping you maintain the attention of your customers over time.
In short, an MVP for your startup is like a trial run of your vision, allowing you to make mistakes at the point when there is less to lose.
As Thomas Edison said, “I have not failed. I’ve just found 10,000 ways that won’t work.” It is the spirit of an MVP.
How to build an MVP?
The framework comes before development
Now you understand the ‘Whys’, it’s time to ask “How”. Let’s take a look at the benefits of creating an MVP framework.
- Inspiration. From the moment your idea was born, it’s important to begin analyzing it. The more questions you ask, the clearer your vision will become.
- Analysis. Now it’s time to pay attention to what currently goes on. Look around and understand how important the problem is. How frequent it appears? What is the current solution? Who is your customer? Who is your competitor? And so on.
- Validation. The easiest way to validate your vision and give you confidence is to ask your customers for feedback. But find the right customers is another challenge.
What framework should you put in place before starting the development process?
- Gather the team. One of the most important things at this stage lies in supporting each other, mutual criticism and exchanging expertise. A strong team is also one of the main requirements for a venture capital fund. So, how to build the dream team?
- Develop an MVP. Now it’s time to find adequate developers, who can provide you with a quality technical solution. To do so, you need to collect your business and technical requirements, then prioritize them before beginning the development process. Let’s read how did I collect my product requirements!
As personal advice, do not assume an easy looking plan will be easy to follow. Often the more detail the better to help keep disciplined and on track. Remember an MVP is only the first step to building a successful startup.
What comes after an MVP?
Keep an eye on the numbers
The basic principle of lean startup design is to build, measure and learn.
It’s very important to choose the correct metrics of measurement since there is no standard. This approach depends on your business model. For example, the SaaS product of an MVP is based on the following metrics:
- The lifetime value of a customer.
- Cost of acquisition of a customer.
- Churn rate.
Keep attention, the wrong chosen metrics could make you follow the failed vector of the development.
- Always ask your target audience for feedback.
- Always listen to your target audience.
The basics of the MVP concept.
In general, an MVP is the perfect choice to make when you begin working on a startup. And here are the 3 reasons why:
- It’s great for first-time entrepreneurs and a proven way to check how your vision matches the real needs of your market.
- It’s budget-friendly. A cheap MVP can actually help you save money as it stops you from wasting money going off track.
- It’s customer-friendly. The focus on the particular pain with a particular solution makes the MVP process simple. Simplicity is what users value and love.
However, an MVP is only the starting point to building a business and it’s important to plan ahead when budgeting. Check our article on “How much does it cost to build an MVP?” for more information on startup expenditures.