Lean Startup? Thoughts On A Minimum Viable Producte_darrellj | Feb 20, 2014
Occasionally we invite clients to discuss issues of importance to those who engage freelancers on Elance. Here are some thoughts from Nicholas Wright. He frequently hires freelancers and is one of the founders of AppInstruct, an online Course that teaches people how to make an app utilizing the Elance platform.
In our last guest post, we looked at how you might set about starting to turn your idea for a new mobile app, into an app. Today we’ll discuss a hot topic in the relatively new discipline of startup science, which is having a growing impact on traditional management education, the ‘minimum viable product’, before looking at how that relates to current market expectations for mobile apps.
Since the first dotcom boom in the mid-nineties, technology changes have made launching new products dirt cheap, radically lowering the barrier to entry for new ideas and products. What once required months of planning, writing a detailed business plan, pre-funding in the tens, sometimes hundreds of millions of dollars, can now be achieved for thousands of dollars. This shift has seen new management practices exposed and adopted.
Possibly, the most significant enabler in all this, has been the growth in the volume of computing power and digital storage that is now available online. This was pioneered by Amazon Web Services (when one of their product managers suggested the business as a good way to use their excess capacity), which remains the largest ‘cloud’ provider, with a free basic package, which includes 750 hours of server time. Similar services are now offered by the likes of Microsoft (Azure), Google (App Engine) and, acquired by Facebook, mobile focused Parse.
What this means, is that when turning your idea into an app, you don’t need to invest thousands of dollars building your own, proprietary server systems to support your app. Rather, you can hook it up to one of these cloud providers, which then allow you to increase your bandwidth (usage) as you grow your user base and needs demands it. An example of a very high profile mobile app company which has done this successfully, is Snapchat, which launched and ran for about six months, before it raised its first round of outside funding. We’ll return to Snapchat later.
Returning to the management theory, there are two leading authorities, who developed different theories whilst actually being involved in the same startup. Steve Blank and Eric Ries were both involved in IMVU, which was an instant messaging firm, where Mr Blank was an investor and Mr Ries, the Chief Technology Officer. Their approaches differ, in that Mr Blank in his books ‘Four Steps to the Epiphany’ and the more recent ‘Startup Owner’s Manual’ favours an approach of ‘customer development’, of ‘getting out of the building’ to talk to as many potential customers as possible, to learn what it is they want.
Whereas, Mr Ries, in his book, ‘The Lean Startup’ focuses his learning method on ‘product development’, measuring how customers actually engage and respond with the real product. In following this path, entrepreneurs should start by making a ‘minimum viable product’, or ‘MVP’, to gauge the audience’s interest and measure what they best respond to. In doing so, he considers this validated learning. If the product is not successful, then the entrepreneur should ‘pivot’: which may be a small but significant change in the feature set, to dropping the product completely and building something different, starting again with a MVP.
There is very definitely value in both methods, and at AppInstruct we cover both and recommend you combine them, but both also have their limitations.
With Mr Blank’s method, the risk is that the customer indicates they want, will use and will buy product x, only to not do so when it’s actually built for them. He himself identifies this, and naturally suggests the optimal threshold is to have them not only express keen interest, but pre-order and pre-pay.
Mr Ries method on the other hand, is extremely powerful, but also comes with its limitations. If we return to Snapchat, the founders had an idea that people might like to be able to privately send impermanent photos. They built and launched their mobile app (after everyone told them it was a bad idea – zero ‘customer validation’) in a short space of time, and after a slow start, found a core market amongst high school students and have grown exponentially since. The design and functionality of their app, remains relatively low fidelity – their idea and good fortune were so strong, that a ‘MVP’ has grown into an asset valued in the billions.
The limitation with Mr. Ries’ definition however, is that what constitutes ‘viable’ is completely subjective. Whilst the benefits of this, are that it provides the flexibility to be used across different markets and industries, the disadvantage is that it may create the temptation to build something that fails to meet the ‘viable’ threshold. Whilst Snapchat is a fantastic example of how it can work (and it must be noted, it wasn’t the first ephemeral messenger), mobile users have established a high expectancy to what native apps can do, and how well they work.
So, in the mobile context, we recommend you employ a ‘MVP’ methodology in the context of simplifying your idea and product, but are careful not to do so in areas such as reliability and design. Unreliability, crashes and bugs will kill even the best ideas. So, be careful not to use building a ‘MVP’, as an excuse to build a flawed product – rather use its strengths to simplify your idea into its core components, build and test those, and then iterate on that learning.
In our next post, we’ll take a look at the various ways you can raise outside funding for your ideas.
About the author:
Nicholas is a co-founder and CEO of AppInstruct. Nic is actively involved in the startup space, mentoring other founders with mobile, fundraising and legal advice. Nic’s favorite app is WhatsApp, which allows him to remain in contact with family in America and England.