MVP - Understanding the methodology needed to manage your company and product direction
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This presentation details the differences and methodologies behind the product development process. Covering the definition and usage of 3 major tools that can be utilized in a startup. MVP: Minimum Viable Product MMP: Minimum Marketable Product MVV: Minimum Viable Vision Prepared & presented by Larry Thorpe as a mentor for Teach for America 2013 Notes included in download
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MVP - Understanding the methodology needed to manage your company and product direction
- 1. MVP’s – MMP’s – MVV’s What are they? What’s the difference? Why should we care? “Everything should be made as simple as possible, but not simpler” - Albert Einstein (Simple does not mean easy)
- 2. MVP – Minimum Viable Product MMP – Minimum Marketable Product MVV – Minimum Viable Vision
- 3. Startup + +
- 4. Release early, Release often How many features would you rather have? 1|0
- 5. Product development approach Build a great product with lots of features - Time wasted in building something nobody wants Start Start Simultaneous Launch Build for fast release Integrate customer feedback Resulting MVP MVP Sequential Pivot - Time wasted in getting the right customer requirements
- 7. Minimal Viable Product An experiment to validate the hypothesis Produce /Code Produce /Code • Needs to solve a real problem • The MINIMUM set of features needed to learn from early adopters • NOT The final version
- 8. Minimum Viable Product An MVP should have just enough to deliver value to your early adopters get paid gather feedback for future development Digital Physical Explainer Video Prototype • • • • 1-2 minutes Explains: – – • Product / Service Why someone should buy it Service Makes people say, “Sign me up!” Landing Page • • • • 3D Printing Arts/Crafts Maker/Hacker Spaces Single page website with “Call To Action” MINIMAL TEXT!! (8 seconds to capture visitors interest) Has ANALYTICS to track visitors interaction Collects information so you can follow up Concierge MVP • Manual Product or Service Delivery – Expedite learning by working directly with your end-user – Fastest way to answer your biggest question, • “is my product solving a real problem that is worth paying for?”
- 9. To get paid! Your MVP should be valuable enough to justify it's initial cost. You can use it to build capital to pay for further development without having to borrow.
- 10. MMP • Based on the idea that less is more • Shippable product with the smallest feature set that – Still addresses the user needs – Creates the right user experience • Product with just the right features and a great user experience The key to creating a successful MMP is to “develop the product for the few, not the many,” - Steve Blank (founder of Lean Startup Methodology)
- 11. Minimum Marketable Product Sell it BEFORE you build it
- 12. How did they do it?
- 13. How they did it?
- 15. MVP – Multiple Iterations throughout the growth process MMP – Developmental Product intended to gain market share MVV – Company True North & Guiding Vision
- 16. Larry Thorpe Growth Hacker Business Development Startup Enthusiast “Don't Let a Minimum Viable Product Minimize Your Minimum Viable Vision” - Hunter Walk @Larry_T Inquire@LarryThorpe.com Questions?
Notas do Editor
- Title Slide: Introduction Larry Thorpe, Growth Hacker, Business Development Consultant. JoeOnTheMove Highlights 7.5 million indirect reach in 3 years 2+ million minutes to troops
- Slide 2: Who do we have in the room? What types of products do you represent? Digital/techPhysicalServiceWhat phases are you in? IdeasDesignPrototypeSales
- Slide 3: Customers + Product + Team = StartupStartups time spent on 3 things: Building ProductsAcquiring CustomersBuilding a teamIdea pulls conceptCustomer’s money pulls better productProduct requirements pull team Everything else (raising money, patents, press, compliance, recruiting…etc…) exists to serve some part of this formula. Goal is to rapidly reach profitability by:Building a product customers LOVECreating profitable distribution channelsSelling the product in volume This strategy is particularly useful for startups especially when there is significant market risk. It’s hard to distribute a product customer don’t love, so by using this methodology we can achieve product/market fit first. Then we create profitable distribution channels which allow us to essentially print money to use in acquiring new customers as quickly as we like. In it’s infancy, a startup releases a Minimum Viable Product (MVP), puts it in the hands of a few customers, incorporates their feedback into the next MVP, and repeats this cycle indefinitely, perhaps pivoting along the way. The company keeps iterating until:The product has achieved measurable product/market fit The company has received some money from innovators and early adopters, its at this stage that Angel investment and sometimes seed stage VC’s will sometimes get involved as well.
- Slide 4 – Release Early and Often- Take a page from Open Source - release early, release often The likely scenario if you have a huge feature list is that the product will take months to develop. In the meantime, the market may change, competition may change or the intended customers may change their mind about what they want before the first release. This will result in anything from further extending the development timeline or worse, loosing market window and being left with having wasted significant time and resources.
- Here we find ourselves with a decision to make: Build a product with as many features as we can think of, and then release it. However, chances are that we don’t know our clients as well as we think we do, don’t know their needs and even if we spend a lot of time developing at least one of two things will happen – a lot of features are useless or even worse – nobody wants it. And as a result of launching everything at once, now we don’t know which part our clients don’t want.ORBuild steadily while integrating user feedback along the way to continually produce a BETTER product rather than a fragmented set of features.
- A development team is going to need to release iterative versions of the product to the customers often. At the end of every iteration, you will have a working, user tested, production ready MVP to demonstrate to your customers.This sequential process is critical to getting valuable feedback in time to have an impact on the products next phase of development.
- An MVP should have just enough features to allow you to:Deliver value to your early adoptersGet paidGather feedback to further develop your product Most products don’t fail because they have bugs, or don’t perform to perfection, or are lacking that special feature. They fail because no one wants/needs them. If you are trying to establish a beverage company, your minimum viable product may be lemonade, but you may additionally have to step back and see if there's market interest in lemonade. An MVP is all about gaging market interest and determining what the minimum features required are to capitalize on that interest. Is there a market for it? Is the monetization strategy sound? These two elements go hand in hand.
- No matter what you use for building your MVP at different iterations, be sure to integrate analytics technology to measure the engagement of your audience. There is no sense on testing an MVP if you aren’t going to measure its success!Don’t be afraid to ask for the sale!!
- Slide 9 – Show me the money! Thalmic Labs, did a great job with their MVP recently using an explainer video. Their video proved market demand by preselling 10,000 units in the first 2 days after its launch. Their new MYO armband (it looks kindof like a sweatband) but is actually a unique control device measuring muscle movement and electrical impulses, and translates those into commands for electronic devices via Bluetooth. As a result of the initial success to their MVP Thalmic Labs raised $1.1 million in seed funding, was accepted into the Y-Combinator, and recent numbers show they have already sold over 25,000 units, hitting $4 million in total sales before shipping a single product. They are currently on track to start shipping their MYO device in early 2014! Talk about a grand slam.
- Now that we understand that the minimum viable product (MVP) is a powerful concept that allows us to test ideas, it is important to remember not to confuse it with the minimum marketable product (MMP), the shippable product with the smallest feature set that still addresses the user needs and creates the right user experience. The MVP helps you acquire the relevant knowledge and address key risks; the MMP reduces time-to-market and enables you to effectively launch your product faster with less risk associated, due to the research compiled while utilizing an MVP.
- Here we see an MMP with an MVP attached. This is an example of a Freemium model for a digital product. An example of a minimum viable product in action. MVPs reduce time to market. It’s a good sign when people sign up to be notified. And if nobody signs up, you build the next iteration and see if that iteration produces traction, which in turn provides increased feedback to be used in creating the following iterations. How could we modify this MVP? Could we collect credit card numbers? Could we promise to not charge customers until Pro is delivered? Could we give customers a discount for buying early? What do you think?
- Groupon2007 - Andrew Mason, backed by Eric Lefkofski created “The Point” (do good website) – “The Point” was a social media platform designed to organize groups of people together to solve common, larger scale problems. Mid 2008 - After over a year of minimum traction, Lefkofski came up with the idea to apply volume price discounts to groups of people online (theater tickets in volume). PIVOT - Still wanted to do something as a group, but this time it was to save money. During Groupon's first months, customer support head Joe Harrow would spend three hours every afternoon personally emailing all the customers who bought vouchers after the deals closed. It wasn’t until 9 months in that Groupon switched to software specifically designed for their new business model. Dropbox: Y-Combinator graduate, founded in 2007 by Drew Huston and ArashFerdowski. It started as a solution to a problem – Drew forgot a USB memory stick at home and started working on a solution for himself and then figured out he could apply the idea to solve more people’s needs. Since this concept involves a lot of development to actually make work, Drew made an explainer video, narrated by himself, explaining how the product was going to work.Subscriptions went from 5,000 to 75,000 overnight. Mid 2007 they got funding from Y Combinator, and the rest is history!Food on the TableBoasting they will “Take the stress out of dinner today!” They provide 5 weekly dinner menus based on your preferences, delivered to your app, with a grocery list and sales for your local stores. Manuel Rosso – launched a site combining information on:“what’s on sale in the local store”“what your family prefers” Curating these with chef recipes so you can get a meal plan with recipes and grocery lists – revolutionizing the way people buy groceries and eat at home. This idea is Complex! Many pieces of information coming from different sources, and needs to be easy and quick.Taking a Concierge MVP approach they manually did the whole meal planning process – Manuel and Steve Sandersen – went out and met clients in a local coffee shop, etc. Very ineffective! But you get your customer validation.
- Too often founders have sacrificed the WHY in the process of speeding up the WHAT and HOW. The Minimum Viable Product approach is not fundamentally at odds with thoughtfully articulating the long-term vision of the company. In many cases the founders (YOU) bring this with them to the startup - it's why they selected this path. Other times though, founders are coached on mission & vision in the context of selling the big picture to investors. If it's not in your heart, writing on a slide won't make it true.
- If your Minimum Viable Product is the simplest implementation that will add value for your users, and your Minimum Marketable Product is the shippable product with the smallest feature set that still provides great user experience, your Minimum Viable Vision is the most succinct version of why your company matters and what you hope to become. A minimum viable vision is one that captivates. It scales. It has potential. It’s audacious, compelling. As a founder, you have to hold that huge, hairy, world-changing vision in one hand, and the practical, pragmatic, seat-of-the-pants reality in the other. The MVV you need in order to get funding (whether investment or market segment) demands a convincing explanation of how you can become a dominant, disruptive player in your market. Your MVV isn't just for your employees or press or VCs. It's your products true north too. If you don't know the destination, then it's hard to ensure your product and company don’t isn't now and doesn’t end up as just a collection of parts and features.