You’ll only be able to generate good traction when all the three elements of your idea are properly defined—the problem, the solution and the business model.
Which means your assumptions about each one of these elements have to be true.
And to know which of your current assumptions work and those that should be replaced by better assumptions, there is just one way, my friend: to validate them in the market—with real people.
Take into account that “validation” means FINDING STRONG EVIDENCES THAT SOMETHING IS TRUE.
That’s why, as a startup founder, you should relentlessly look for those strong evidences, from real people, to validate your idea.
The Lean Startup
Before talking about the MVP, it’s important to mention what The Lean Startup methodology considers about startup development. There are great readings on that topic and I recommend you to read them as much as you can (must-read book: The Lean Startup, by Eric Ries),
But, for now, we may consider the steps below:
- Identify the most important (critical) assumptions about your idea.
- Define the product’s features that are really needed to test these assumptions.
- Define the metric(s) and value(s) that will indicate your assumptions were validated or not.
- Build a Minimum Viable Product (MVP).
- Test the MVP with real people.
- Measure the outcomes against your metric(s).
- Analyze and learn: if it failed, understand why.
- Iterate, Pivot or Scale.
In summary, the MVP is the minimum set of features needed to deliver some value for your customers to solve their problem as well as to allow you to test your most important assumptions.
This process of building an MVP, testing your assumptions and iterating your solution is at the core of The Lean Startup. If you follow these steps wisely, you’ll raise the chances of building something people really want, because you’ll learn and adapt your assumptions with the knowledge you gained from the market.
It’s possible that you are right about your assumptions from the very beginning and, after completing all the steps, you already see the traction and your solution is ready to scale.
However, it is much more likely that you’ll have to iterate (make small changes) or even pivot (make a structural change) your idea several times before finding something that really works.
And the biggest challenge lives exactly in being able to repeat the process as many times as you need, until you find validation.
Why is this a challenge? Because each time you execute the process it will consume some of your startup cash. And if you’re still not generating revenues—which is very consistent with a startup that is still in the validation process—you’ll end up with no money.
[related post: 3 Key Financial Indicators That May Save Your Startup’s Life]
And guess which of these steps tends to consume your startup’s cash the most? Yes, building the product.
That’s why it’s so important to include in the first version of your product only those features that are needed to test your assumptions, while delivering some value to the customers—or a Minimum Viable Product.
Always remember: your objective is to run your startup as LEAN as you can.
Identifying The Assumptions
After clearly defining the three elements of your idea, you should think and identify what are the critical assumptions underlying those three elements.
These assumptions are at the core of your idea and, in the case they are wrong, they’ll prevent you from being successful.
For instance, if you’re building an app for the elderly in order they can instantly communicate with their relatives in the case of any emergency, your most fundamental assumptions might be:
- The elderly will easily understand the solution
- The elderly will be able to easily use the technology
- Their relatives will trust your solution.
- The elderly or their relatives will be willing to pay a sustainable price for it.
Of course, these are just examples of important assumptions for such an app. However, it is essential that you think thoroughly about what are your startup fundamental assumptions.
As you might have noticed, to validate these assumptions, you don’t need a full-feature product working. Right? Besides that, you don’t have to validate these assumptions all at once. You may choose one or two to begin with.
The point is: you don’t need all the 12 features you’ve come up with, because most of them won’t help you on validating the assumptions above. Trying to put all them there, will just take you time, money and energy, but won’t add any value in this part of the validation.
The definition of the features of your MVP, will set the necessary amount of work (and money) you’ll have to invest to allow you to go to the validation phase.
So, think wisely about which features to include and which not.
Defining MVP Features
Okay. You already know that the MVP is something between doing nothing (no features) and doing everything (all features). Now, you just need to understand the criteria that define what is too much and what is too little.
What features are really needed for assumptions validation?
As we’ve previously seen, the purpose of the MVP is to check if the most important assumptions about your startup idea are valid. Therefore, your MVP must be sufficient to support your validation.
Always remember that, to say something was “validated”, you need to have STRONG evidences about that—just hearing some people say “it’s a good idea” cannot be considered a validation.
Ask yourself: which features will provide you strong evidences that your most important assumptions are valid or not?
Another way to check if the feature is really needed is by asking yourself: how will this feature provide me evidences to validate assumption “x”? If you can’t answer it in a clear way, probably that feature is not needed now.
What features are really needed to provide customers the core value of your solution?
After considering the validation aspect of your features, now you have to think about the value your MVP will add to your customers.
To enhance the strength of your test, the MVP aims to add some of your value proposition to solve—in some way—your customer’s problem.
In other words, if you are able to set your MVP with features that are at the core of your value proposition, you’ll be able to really understand how real people—with a real problem—engage with your solution.
If you just tell people that you are thinking about building a solution to solve their problems, they might say: “it’s awesome!”, “I love it”, etc.
However, if you actually offer them some value based on the solution you created, they’ll will show you how much excited they really are. Instead of just hearing their words, you’ll see their actions, such as: purchase orders, downloads, price requests, questions about new features release dates, etc.
Start by defining the most fundamental assumptions about the problem, solution and/or business model.
Then, define which are the features you need to put in the first version of your MVP to test and validate those assumptions as well as to deliver some value for your customers.
In future posts, we’ll see more about the execution of the validation process and the other steps of the Lean Startup Methodology—Building the MVP, Measuring it, Analyzing and Learning; Iterating, Pivoting and Scaling.
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Alexandre Azevedo (LinkedIn)