Steps before building a Minimum Viable Product
Most of the first time entrepreneurs are so passionate about their idea that tend to overlook customers whom they plan to build their startup around. They put their mind and soul in getting prepared to pitch to investors. What they fail to understand is that raising funds is not a day-long process. It demands a lot of time and effort before the first cheque arrives.
In this article, we will see how the idea of starting out with a Minimum Viable Product (in short; MVP) results in failure and is indeed the reason that cannot be ignored.
But before diving further, it’s important here to know the psychology of most of the first-timers. The prominent points are given below:
- They think that the startup that launches its product (or service) first gets the first-mover advantage and therefore they are anxious to launch their offering as soon as possible.
- Those familiar with the concept of Minimum Viable Product, start to develop the solution based on their best guess, release it to start the learning cycle based on feedback from early adopters and refine the product through iterations based on build-measure-learn loop.
- Rely on analytics and metrics to understand customers.
- Most of the time, they are obsessed about their idea and build the solution around it.
Let’s understand each of the points stated above in detail:
Point No. 1– It’s important here to note that first movers usually have a disadvantage as they have no market to validate their idea. They have to put effort into building the market from scratch and that becomes too risky. All popular companies like Apple, Facebook, etc. are not first movers but fast movers.
Being a first-mover can be quite expensive as you may have to invest heavily to educate customers about your product. The followers or the later entrants may take advantage of it, grabbing a major chunk of the market share by offering an improved version of your product to the already informed prospects.
Point No. 2 – Build-measure-learn approach is better than spending time in building the complete product only to know that nobody wants it. But this approach turns out to be effective only when you start out with a GOOD idea as it manages to attract early adopters and keep the build-measure-learn loop going.
What if you start with a BAD idea? If you now offer your solution to your customers, and it fails to satisfy them, they may simply reject it without giving any feedback. You may then find yourself guessing about the reasons for failure and & get stuck in a loop trying one idea after another.
Here you may argue that this is what a minimum viable product is all about – Product with a minimum set of features that attracts early adopters or starts a learning cycle. So if there is no feedback or customers reject the solution, it’s better to think and work on a different idea.
But then why to waste your valuable time building something that turns out to be a failure?
The only way to reduce the chances of failure is to start with a good idea. But how can one know whether the idea is good or bad while starting up? The above approach of beginning with a minimum viable product certainly cannot predict this.
The right approach is to focus on the problems before even thinking about any solution. The concept is quite simple. If there is no problem, it’s worthless to think about the solution. But most of the entrepreneurs commit this mistake due to their obsession with the idea.
Think about this – Is it logical and worthy to build a lock or a key first? Building a key without a lock and then searching for the right lock is analogous to starting with a solution and then searching for a problem that can be solved with that solution. On the other hand, if you start with the right problem (lock), it becomes quite easy to build the solution (key) for it.
Point No. 3 – Relying solely on metrics to understand customers does not deliver the right results. In case, customers don’t like your offer and reject it without feedback, the metrics can only tell you they are leaving, but fail to tell the reason why they are doing so. Hence it’s extremely important to talk to customers and understand their biggest challenges –their problems. Once you start to talk to your customers, you start to get more and more insights about their needs, desires, pains, and expectations.
Point No. 4 – It’s always good for the startups to be obsessed – but about the problems of their customers and not the solutions that they themselves wish to build.
We hope that the psychology of first-time entrepreneurs and their mistakes will help you to gain some clarity while starting out your own venture.
By this time, you have possibly understood why it’s not worthwhile to start with a minimum viable product and the importance of focusing on problems before solutions.
Now let’s understand how you should start with the problem-focused approach.
Steps Before building an MVP
Before jumping to build a minimum viable product, as Ash Maurya says, it’s better & beneficial to follow the stepwise approach given below:
- Step 1 – Sketch several variants of your idea on Lean Canvas. This helps to figure out multiple customer-problem possibilities. Remember that these possibilities are still assumptions that need to be validated.
- Step 2 – Now the customers are interviewed to validate assumptions related to problems and customers. It’s always better to interview as many customers as possible but at least 20 should be interviewed. Once the customers & the problem are validated, defining the solution becomes easy.
- Step 3 – After validation, a demo should be built and offered to prospects during subsequent interviews.
- Once you have enough customers to buy your offer, you should start to build your minimum viable product.
If your offer is attractive i.e. it solves the problems or satisfies the need your customers crave, they will push you to deliver them the MVP as soon as possible rather than you asking for the feedback as in an ‘MVP first’ approach. This way, you become confident about the demand for your offering and you can focus on building your minimum viable product without stress.
You may now ask two questions:
- What types of problems should be attempted to increase your odds of success &
- The types of questions that you need to ask from your prospects.
Our article on a 4 step approach to evaluate your startup idea might help you to figure out the type of problems you should choose.
Questions that you ask from your prospects largely depend on your business idea and the sector you are dealing with. However, to get an idea about the kind of questions that you should ask, you may use the questionnaires as suggested by Javelin – a great tool to help you to conduct customer interviews for identifying their needs.
To Wrap Up
The key takeaways for you from this article:
- Focus on the problems (that your customers face) and not your solutions.
- Building a minimum viable product comes later in your startup journey. Customer & problem validation is what is needed first.
Do you feel there is something more to be included? Kindly write to us. We will be more than happy to consider your valuable suggestions.