What is an MVP?
If you're an entrepreneur, you have probably encountered the term "minimum viable product" or MVP before. An MVP is an early version of your product, with just enough features to test it in the market and gather feedback for future development.
An MVP is not the same as a prototype. A prototype is a draft of your product, whereas an MVP is the functional 1st version of your product. It is a simple version with the minimal necessary features to satisfy customers, not a finished product. However, this MVP forms the basis for the final product, because it's testable and scalable, and allows you to adapt your idea quickly.
Why is an MVP important?
Test your product
A startup comes with many risks. 9 out of 10 startups fail, of which 20% in the first year. The main reasons? Not enough money and/or lack of product-market fit. This is where the importance of an MVP comes in.
It's not always possible to build a full-functioning product, and you don't want to create a whole product and then find out there is not a market for it. Testing the market with an MVP reduces this risk of failure and financial loss and increases your chances of success. It is essential for a lean startup that experiments and adapts quickly.
With an MVP, you can test the essentials of your idea. Based on the feedback of early customers, you can detect issues and improve the product before investing time and resources in a fully-developed version. It tells you if people are waiting for your solution and make data-driven decisions for the further development.
Every investor is different: some are willing to invest in startups based solely on the idea and the team behind it, others want to see that materialized to a certain degree. In general, an MVP can be an important factor to convince potential investors.
By building an MVP, you show investors a tangible product instead of an abstract idea. It demonstrates that you have an understanding of the needs of your target market and have taken the risk and time to develop a functional solution already. This dedication can be very compelling to investors. Of course, that doesn't mean you need to have an MVP to raise money. There are investors who will invest in the idea itself, and for some innovations it's difficult to create an MVP due to R&D time, money, or size.
If possible, try to work on developing an MVP while exploring potential investment opportunities. By having a clear road path for your product and demonstrated progress, you can increase your chances of securing funding.
How to create an MVP for your startup?
Steps to create an MVP
A good MVP isn't created overnight. There are a few steps you need to take, but it's not as difficult as it sounds. These are the steps you can follow to create an MVP for your startup:
- Market research: What problem are you trying to solve and which customers are you targeting? What do they need, what do they want to achieve, is there direct competition?
- Define features: Which features do you need to solve your identified problem? Prioritize the features based on their importance, because you can't add the full feature set.
- Design the product: Design a simple product that includes the essential features. You don't need to go all in, but make sure it's a simple and user-friendly UX.
- Build the product: If it's a software solution, you can build the product with either a low-code platform, or develop custom software. Below, we weigh the pros and cons of both options.
- Test and analyze: Test the product with early customers, analyze its performance, and gather feedback. Use this feedback to continuously improve the product with every release stage.
- Improve, scale, or ditch: An MVP allows you to learn if there is a market and in which form it should appear. If the feedback is positive, you can expand the MVP with more features into a full-functioning product. If the feedback is negative, you need to use these insights to create a new MVP that is better tailored to the market needs.
Low-code vs. traditional development
There are several ways to create an MVP. A popular way is by using low-code or no-code platforms with pre-built templates. It's a convenient approach if you're tight on budget, want to start quickly, and don't have a lot of technical expertise. Since it's only an MVP, you can upgrade the product later to a more complex code. However, low-code platforms are not always the most suitable option. You should not sacrifice on the quality of your MVP; if the MVP is not a good representation of the idea or of poor quality, it could skew the testing results. For a more complex product that requires custom functionality or integration with other systems, it's better to turn to traditional software development. Low-code is cheap and quick, whereas traditional software development allows more flexibility and customization.
For traditional software development, you can go into two directions: either you build your own team of software developers, or you use a software development partner to build the product for you. Both have their advantages: with your own team members, you work together on the same mission, and they will normally stay for a while. The advantage of a software development partner is their experience: you don't need to spend time and money to train them. Depending on your agreement, a more personal or long-term approach can be maintained here as well.
When you start working on your MVP, it's a good idea to inform yourself about different options. Determine what your needs, budget and own expertise are, have a look at low-code platforms, talk with a few software companies. Whatever approach you choose, the most important is to create a functional solution that provides value to your target audience. Good luck!