The term and concept of the minimum viable product are attributed to Eric Ries, who talked about building a basic version of a product so that users can try it quickly and give early feedback. It enables a business to perfect the product idea before they spend a lot of time and money on the finished article.
For a start-up this is vital. You begin with an idea but you need to know if it has the need that you hope and the best way to get that knowledge is to create an MVP and then gradually evolve the product based on user feedback.
One note of caution - an MVP is NOT a prototype. Your MVP must be a working version of the product that focuses on a couple of its key features and can be used by a client. A prototype is a great user experience tool but not a finished product.
To listen to more about Eric’s ideas behind why an MVP is important, click through to this YouTube clip. In the meantime, in this article, we will explain the key reasons an MVP is critical for any start-up.
Testing Out The Market
In a recent study by Euler Hermes, evidence points to an increase of 15% in the number of businesses failing from 2021 to 2022 and the top reason for failing, at 42%, is the lack of a market need. Clearly, being able to understand if you have that need before going too far is vital.
Any good start-up should have done research to have confidence that their idea has a market need but they can never be 100% confident and this is where the first big benefit of the MVP comes to the fore.
The essence of an MVP is to deliver the basic elements of the product as quickly as possible, so it is the perfect vehicle for testing the market. Getting the core of the product in front of prospects will enable you to get quick feedback, which is critical to see if your idea is a winner.
You’ll not only get the opportunity to get feedback but judge if people are interested enough to see the product in the first place - it really is the ideal way to launch a new product safely.
Beat Your Competitors
Whatever the idea you are looking to launch on the market, there is always the chance that competitors will be developing something similar, so speed is vital. This is where your MVP can help you.
Those that can perfect the MVP development process will deliver a solution before anyone else, get user feedback and start building a reputation in the market. It won’t matter if the product is not perfect from day one. It solves an initial need and users will always remember it as an early adopter even whilst the product might look completely different within a matter of months.
One famous example of a company not taking the MVP and being beaten by competitors is Google+, the failed social media platform from the giants at Google.
They invested over $500M in building the platform and launched to great fanfare but by the time they did, others like Facebook were so well established that Google’s proposition didn’t stand out as being different. As a result, they never got the users they expected and closed it down in 2019.
Show Me The Money
Start-ups need investment. As we have seen, producing an MVP allows you to test the market and know that by getting investment you can grow your idea. The beauty of the MVP is that it also helps you get that investment.
Investors don’t hand over money to an idea. They won’t write a large cheque for a pitch deck. They need to see a product and preferably one that’s had some initial feedback from clients and the marketplace.
By producing the MVP, you can build your product idea without spending a lot of money on large development teams. Expanding out your product into the final vision you have can come later. Use your MVP, impress investors and then use that new money to build the product of your dreams.
One example of this approach working well is Dropbox. When they first went to investors they were not getting a favourable response, so they went to the market with a 3-minute video to show off the MVP they had built.
The reaction they got was fantastic, the level of comments and engagement was enough to turn the heads of a few of those investors and they are now worth over $9M.
Laser Focus
One mistake that so many start-ups make is trying to do too much. Sometimes in product development, less is more. It enables you to perfect the most important elements of an idea, rather than doing an average job of ten different features.
You should have a tight value proposition that clearly states the problem you will solve and this is what your MVP should be focused on. Your business exists to solve a customer's pain and an MVP ensures you never lose focus of that.
Because an MVP has to focus on a maximum of 2-3 key pieces of functionality, it forces a company to decide what is the most important part of their product and only include those things in their MVP development.
They put all the effort into perfecting those elements, the things that people will always remember your product for in the years ahead even as you add new features and functionality.
A side benefit of this laser focus is not spending money at the start (when most businesses don’t have it) because you are not building in elements that are not vital to the business. Less money is spent on developers building nice to have features that you cannot be sure will have an effect on the prospects.
The Perfect Use Case
It is always helpful to see an example of a technique working in the real world and there are many famous cases of businesses that built their growth by launching an MVP, one great example is Spotify.
For their MVP, they focused on the one feature that mattered, streaming music. They left all the other elements aside and delivered the central idea. They were able to get feedback on the main concept and then add to it once they had confidence.
They also stuck with just a desktop version of the product, again focusing on getting the product as quickly as possible in the hands of the people that mattered, then worried about a mobile app once they knew they had the right idea.
This enabled them to beat others, get validation from key influencers in the market and the work spread very quickly, giving them the confidence to start showcasing on a wider scale and investing serious money into growth.
It’s Time To Build Your MVP
Assuming we’ve convinced you about the importance of an MVP for start-ups, how do you build an MVP as a start-up?
The best starting point is to pick a no-code platform, work with some no-code experts and you can genuinely have an MVP development live within a matter of weeks for a fraction of the costs of traditional development.
The no-code approach to MVP development works because these platforms come packed with templates that will already cover many of the features you’ll need. It will have automation built in, likely be hosted so no worrying about infrastructure and because of their popularity, you’ll quickly find developers that don’t cost massive sums that a start-up doesn’t have.
