Why a Minimum Viable Product is Important for Startups?
| 3 minutes read
Building a minimum viable product for a startup is one of the sureshot options to be successful. Startups are focused on developing Minimum Viable Product (MVP), but things are not easy as it looks. You might be thinking about what it is MVP? You must know companies like Instagram, Spotify, Uber, and many others. These are million-dollar companies; they earn millions, but what’s expected of them? They all started with a minimum viable product. Along with this, product marketing strategies also play an essential role we discussed previously.
What is a Minimum Viable Product?
Basically, MVP is a version of your software product that comes with the most basic/standard functions. It is launched to get feedback from early adopters and testers. Their feedback will show what should be changed/ deleted/ added to your software product.
Why is a Minimum Viable Product important?
An MVP helps you get early birds data that used your initial developed product. A positive response gives you the green signal about your product. And then, you can develop the full version.
By creating and testing a minimum viable product, you can:
- Save time and resources by making sure you’re investing in a tested project that will be successful.
- Check whether the product is appealing to targeted users.
- Aсquire a potential user base and find early adopters.
- Save time and money on developing the final product for your customers.
- Attract investors earlier for more investments.
Examples of the most successful MVPs Companies
It’s hard to believe if anyone says they don’t know about Facebook. Today, the platforms have given to so many businesses promoting their goods and services. Not only Facebook itself offers different products and services.
Also Read: How to Choose the Right Franchise?
However, few people know that Facebook initially had a simple concept. It was designed as a universal directory for Harvard students only.
By narrowing their focus, Zuckerberg and his team avoided drawbacks common for many startups during their initial days. For instance, they did not spend too much time and money building unnecessary features that don’t require. Instead, as you might have observed, Facebook slowly adds new features over time.
After several months after the release, Facebook added three other prominent American universities: Yale, Stanford, and Columbia.
On September 26, 2006, everyone aged 13 years and older got the chance to register on the platform. Thus, Facebook gradually became the most extensive social network as we know it today.
Spotify is one of the classic examples of an MVP with one dominant feature that came off with flying colors. Daniel Ek and Martin Lorentzon set themselves to develop the best music streaming product. So, they stuck to one main feature: free music streaming.
Spotify’s MVP was a desktop version of the app presented to the closed beta. This way, the company tested the viability of its business idea in the most cost-effective manner.
This is why a Minimum Viable Product is important for startups.
This company had focused on developing a minimum viable product with a single prominent feature. The application should allow users to check-in in different places and receive badges as a reward.
As soon as the application became popular, Dennis Crowley and Naveen Selvadurai started iterating their product. They added recommendations, city guides, and other functions.
Reasons to Develop an MVP
1. Ability to Pivot
Like building a startup, entrepreneurs must ask themselves whether they need to “Stick or Twist.” Do you want to continue and stick with what you have? Or do you want to twist and try a different strategy?
Understanding when to pivot is necessary for developing a successful product. MVPs allow for flexibility in your development since they are small enough.
One of the most famous pivots in recent history is Instagram. The company started small, developing an app that allowed users to share photos. But, growth stuttered as competition such as Tumblr and Tiktok offered a service that attracted the majority of the customers. Soon, Instagram launched Reels. And captured the market of the services provided by Tumblr and Tiktok.
2. Ability To Launch Early
Speed is the name of the game here. The quicker you can launch your product, the faster you will be able to learn about it. Customers that interact with your product sooner deliver important feedback for product quality. Also, every industry has competition. Competition makes the products and services better. Yet, being first can help improve your brand recognition and image.
3. Improves Your Chances of Funding
An MVP that shows significant promise and gets positive feedback in its early days of development is more likely to get funding from investors, and it is a good sign for future growth.
Investors understand that the risk and cost of making changes to an MVP are lower than that of a fully-featured product.
MVP is a great concept that will help you validate your business ideas in the early days. In other simple words, it will give you an idea of how well your product will get success. As a result, you get better assumptions and clarity about the products and the services.
With its help, you collect initial feedback from targeted users and investors without significant expenses. As a result, you can grow a client base and enhance the product.
Suprotik Sinha is the Content Writer with Synkrama Technologies. He writes about technologies and startups in the global enterprise space. An animal lover, Suprotik, is a postgraduate from Symbiosis Institute of Mass Communication (SIMC) Pune. He carries 6+ years of experience in Content Writing, and he also worked in mainstream broadcast media, where he worked as a Journalist with Ibn7 ( now known as News18 India) and Zee Media in Mumbai.