MVP stands for Minimum Viable Product, and its sole purpose is to combine the basic features we want to test to get feedback from the target audience and potential customers.
Startup companies understand that getting quickly to an MVP is critical to the company’s survival as it allows for savings of time and money. There is no need to develop a final product that will look amazing and no need to invest in an expensive and impressive marketing strategy. All you need is to develop a product that will work and allow for feedback to improve and preserve the final features. Without the MVP, the venture’s chance to progress is much lower than with the MVP.
Beyond developing an MVP, it is crucial to maintain its sole purpose, which is to test the critical features in front of its target audience. If the product does not work, it is not an MVP, and you should continue to develop it until it becomes one. Sometimes, entrepreneurs fall in love with the idea of the product and don’t reach the MVP at all; this is discussed in a previous article dealing with Five Common Mistakes Made by New Entrepreneurs and How to Solve Them.
Your MVP is a key part of the development process up to the finished product. I have included several other benefits:
1. Cheap and fast feedback
It’s impossible to develop a winning product without feedback from real customers; it is impractical to develop a product in lab conditions or void because a void has no buyers. You must get out and sense the market and your customers; This can only be done with an MVP. Understand what works, what doesn’t. What should be preserved and what should be thrown away. With the help of timely feedback with minimum investment, you will know how to bring the product to Market Fit in a large and diverse group, creating a high demand in the final launch.
2. Mistake cost is very low
When launching the final product, the cost of correcting a mistake (Mistake Cost) can sometimes reach tens of thousands of dollars, depending on the mistake.
A final product that has been characterized, developed, and designed will require a high cost of development time for each error or request from the customer.
When talking about MVP errors, the time it takes to correct a mistake in a product that just works is much lower and can significantly shorten the path to reaching a finished final product with as few errors as possible.
3. MVP is much cheaper than a final product – give up on amazing design.
Developing a final product takes time. The design alone can take half a year to a year, depending on the product. You need to invest in a user interface, a shiny logo, eye-pleasing elements, etc. MVP will usually be ugly, squares instead of buttons, grey colors, but it will work, but the development cost is very low relative to the final product.
4. MVP returns its investment
A well-built MVP can sell itself. If the product works, and the customer who purchased it is told that his payment guarantees access to a final product, the investment is already beginning to pay for itself through presale.
Sometimes an ugly product works so well that customers want it straight away when the final design is all that’s missing. Even after the first sale (or launch), the developer already feels that he has something real in his hand, and it encourages him to continue to improve and refine the product.
5. MVP development time is significantly shorter and reduces the chance for competition
Product development or a unique technological solution is usually not a marathon. If it takes 5 years to develop the final product, the competition will likely catch up with you and develop a product similar or identical to yours.
MVP development can take as little as half a year, saving creators’ critical time, avoiding competition, and features duplication. The second issue is vital, especially in a competitive field, where successful feature duplication can signal a startup’s death.
6. Investors require MVP
The potential investor or venture capital has no time for the entrepreneur at all. An entrepreneur who comes up with a presentation only, or an “amazing idea,” will not meet the investor because he wastes his time. The investor’s time is significant, and he wants to see only entrepreneurs who already have a ready-made product, or MVP, not an impressive presentation.
The investor needs to believe that the product can make him money. If he sees a fantastic MVP, he will understand that this product sells itself and will be happy to invest in it. Without an MVP, an investor won’t even schedule an appointment with you.
7. Necessity – understand if the market needs the product
Understand this: If your product has no market, you don’t have a product. Without seeking the product necessity in the market with an MVP before developing the final product, it is as if you have done nothing.
Mark Anderson, the founder of the Anderson Horowitz venture capital fund, said: “Market Fit means being in a good market with a product that can satisfy that market.” The meaning of the saying is to avoid wasting a lot of time on a product that the market does not need or does not want (does not reach Market Fit), so even if the product works and looks great, it doesn’t matter, and the entrepreneur is wasting money and time for nothing.
8. Save on marketing budget
Typically, the marketing budget is 80% of the overall budget. Beyond substantial marketing savings that an MVP allows, it also makes it possible to start thinking about target audiences and marketing strategy while developing it. MVP marketing is needed, but it is easy and cheap marketing, usually to a close circle of friends or potential customers through advertising on existing platforms (social media, website, mailing list). There is no need to reach a massive market because the MVP may still change by then. Massive campaigns for the final product in the future can be targeted according to results that the cheap MVP campaigns have brought.
9. Feedback Loop – for potential customers
ZERO21 works with entrepreneurs and startups in Agile development; some of Agile’s principles are: Software works over detailed documentation and response to changes over program monitoring. The latter is key.
The ability to respond to changes during development or after receiving feedback is integral for success. The ability to respond to potential customers’ feedback is also called a feedback loop and is only possible with an MVP. With this step, it is possible to improve and optimize the MVP accordingly and sell directly to the customer and start paying back the investment.
You need an MVP as soon as possible
There are many advantages to an MVP compared to the final product. Appropriate market, money, time, benefits, return of investment, access to investors are just some of the things that can be achieved with an MVP developed according to specific rules.
At ZERO21 (or 021), we have developed a unique work methodology, the Zero21 MVP process for entrepreneurs and startups in the early stages. We work closely with you for six months. Working on the most important details for the venture’s success – product / financial/legal / marketing – within 6 months, you will have a product to sell to your target audience. Think of it as an accelerator for MVP, only unlike traditional accelerators, and you will not have to relocate to it.
The process includes:
- Research and specification for the product or service you offer. Financial and legal aid until getting an MVP within half a year.
- Design, branding, and development using agile – develop the latest technologies as fast as possible and as best as possible.
- Feedback loop – the most crucial step that is unique to us. You will receive real feedback from your potential customers, and you will be able to improve and optimize the product accordingly. Also, you will be able to sell the product.
Want to hear more? You can contact the Zero21 team or Click here.