Plenty of new startups are represented every day on the market. However, only the strongest of them can turn into prosperous businesses, having passed through lack of funds, public indifference, and so on. So, how to stay the course and survive? You should create a minimum viable product (MVP) for your business. Its price is less than for the full-fledged platform or website. However, it has a set of other advantages like studying the market environment and deriving a profit from it.
In this article, we’ll tell you how to build a successful MVP as well as its benefits and failure-causing reasons. You’ll also get acquainted with the examples of the globally famous companies that started their way from building a minimum viable product.
Building an MVP means creating a product with a limited set of essential features. The others can be added after a client’s feedback.
According to the common misapprehension, the businesses develop MVP to speed up release on the market. But it is not entirely correct. Building an MVP is necessary to prove the economic viability of the final product, and the speed can be essential only in case of minimum viable product testing or market analysis boosting.
The statistical researches suggest that about 20% of startups collapse during the first year of their existence. 2/3 market newbies never obtain positive incomes for a number of reasons. However, building a minimum viable product can help you not to join these low statistical ranks, but to establish a profitable business, having counted all the pros and cons of your decisions.
The world-known companies that took the MVP road have boosted their fortune for today. For instance, according to Statista’s insight, Facebook’s annual revenue amounted to $86 billion in 2020. Thus, let’s dive deeper into the subject to recognize how you can use MVP benefits for your project.
If you work on MVP development, you’ll build a tower of strength for your business. Why so? Because you’ll be able to use a complete set of advantages, such as an opportunity to prevent your company from financial and time losses or a possibility to announce yourself and attract people by your idea. Thus:
The advantages of MVP development
- MVP is a cost-effective solution for your business. The development of a minimum viable product costs less than creation of a full-fledged application. It is possible because of a staged development that allows you to plan your next step and reinvest funds into the project in case of high incomes.
- MVP allows for more accurate customer research. You can collect and investigate your end-users feedback and see the reaction to the work done practically in real-time. In case something’s wrong, you can stop the workflow and reduce your losses.
- The testing allows you to check the entire project concept. So, if you want to launch a multifunctional application, which is financially hard, you can test your idea and reveal the essential features, removing the unnecessary ones and saving money.
- MVP can serve as an attractive thing for investors. People try to avoid the concepts which are ideal only on paper but have no appropriate embodiment. So, having developed your minimum viable product, you can share your idea with the investors and make them trust it.
How to Build an MVP?
Though the MVP has only some crucial features of the final product, it is necessary to plan the development actions from A to Z. That’s why let’s discuss the stages that you should pass to prepare a qualitative minimum viable product.
- You should start with market research. It is a basis for every development that hinders your project from falling down. Investigate and analyze the interests of your target audience. There are many solutions, such as Toluna or SwagBucks, that can assist you in drawing a buyer persona, collecting all the data obtained. On top of it, study how your competitors develop their products. It will help you create your own cutting-edge experience that can get you a head start.
- Present an understandable idea of your future project. For doing it, you should ask yourself whether your project is helpful for the consumers, what problems it would solve, etc. Replying to these questions, you’ll find a clear idea of the features you need and ways of their use.
- Make a feature list for your upcoming project. Among other things, It will help you to hire offshore developers and delegate development to them if you need to build MVP for a startup. Put down all the characteristics you’d like to have and cross the unnecessary ones: your minimum viable product must contain only the crucial features.
- Develop. Launch. Your MVP should be attractive and appropriate to use and invest in it. So note: your product should not be functionally overloaded. Don’t try to make a first-class design and the best functional at once. Move slowly, one step at a time.
- Study the opinions. It can help you understand if there’s anything you can improve. Thus, the people that use your MVP are both the testers and idea-makers for your product.
Now let’s discuss the businesses, which made the way from startups with MVP to world-known companies having millions in revenues.
After unsuccessful competition with iTunes, Odeo started developing a completely new solution — a microblogging platform that obtained an initial code name “twttr.” At the very beginning, it was intended only for the internal use of Odeo workers. However, the solution was so comfortable that everybody decided to share the results with the public.
Twitter’s first interface
Though it didn’t attract people at once, the followers started to join the platform after the SXSW conference. According to Twitter CEO’s beliefs, every detail of the solution was brought to perfection. Thus, no wonder that now Twitter is one of the top world-known social networks having over $1,190 million in profit.
Developing a platform for social nets management, Joel Gascoigne wanted to create a product that would attract customers. So, he decided to start making up an Internet site giving only product details and subscription plans.
Trying to subscribe, users received an email informing them about the product’s unavailability and offered to follow the development process. So, such a solution helped Joel make up a subscriber database, start communication with a target audience, and share traffic ready to be paid.
A Buffer MVP
Thus, the MVP implementation bore its fruit. Buffer started 2021 with more than $21 million profit due to numerous support.
This story is about how two San Francisco guys launched their business on a small budget. They decided to rent out the highest floor of their accommodation to people who came to the town for a design conference and had too little money to pay for a hotel room.
A minimum viable product in this situation was a standard landing page with photos of the housing. It was successful and attracted three first visitors that came and booked the rooms. Then, the entrepreneurs identified their target audience communicating with people. Moreover, they confirmed their idea’s viability and launched the Airbnb platform for short-period housing rent.
Airbnb’s first interface
According to yahoo! finance data for the beginning of 2021, Airbnb is a prosperous business with $887 million in revenue and lots of visitors. The Airbnb CEO, Brian Chesky, believes that his project’s different from Facebook or eBay because people should have a certain confidence level in other people for employing such a rental service.
This company is famous for giving birth to e-watches — great-grandparents of the modern smartwatches that can reflect messages, app notifications, etc.
A company founder, Eric Migicovsky, demonstrated a video concerning his project to the audience. Thus, he attracted them and launched the most effective Kickstarter campaign (the principal sum of investments amounted to more than $10 million) for ages. Unluckily, after the project went bankrupt, it was utterly changed, incorporating with Fitbit.
Other examples of MVP-based businesses
Remember: to pass through difficulties to the stars, you should appreciate the difficulties. You can face with:
- Setting up wrong priorities. If you concentrate on the incorrect solutions or point out inappropriate goals, your minimum viable product won’t even pass the testing without mentioning customers’ engagement.
- Lack of practicing. It is excellent to find a solution to a problem. However, you should constantly generate alternatives, conducting a lot of brainstorming sessions, or making up sketches. Otherwise, your business will suffer from poor judgments.
- Late start. You shouldn’t launch your MVP too early or too late: a happy medium should be struck. Keep in mind that minimum viable product development can seize from 1 to 5 months, and plan a launch date in advance.
- Functional overloading. A balance is essential at every stage of development. So, remember that excess can make the customers angry as well as create a poor user experience. Thus, care for your product quality.
- Customers’ feedback shortage. If you don’t collect people’s opinions about your project, you won’t understand their problems and ways to solve them.
Minimum viable product building is an essential way of strategic insight for your business. Therefore, take all the development stages seriously if you’ve decided to create an MVP for your project. Note that a dedicated team of professionals can help you develop a product that will become a prosperous full-fledged solution. The experts will deeply study all the hidden pitfalls of your idea or give you a clue to solve the most nerve-wracking issues as to the project. Moreover, they can present the top-class developed MVP that will lead your business to success.