You must have noticed, just a few days before the grand premiere of a movie, how a trailer is always released. No matter how the movie is, the trailer does give an abundant idea about the concept of this movie. And judging from the audience’s response, the producers and investors can almost predict the film’s future! MVP i.e. Minimum Viable Product is, more or less, the main trailer of a Startup’s journey toward success!
A petrifying statistics:
According to a recent study by IBM, almost 70-90% of start-ups fail within two years of initiation. And 70% of those who outlast the first two years, go out of business in the next five. This statistic is scarier if you are an investor who funds millions of dollars in concepts and ideas.
In 2001, Frank Robinson first introduced the concept of MVP, where an investor doesn’t have to put in shedloads of money before his ROI is assured. Instead, he can proceed scientifically, experimenting with a smaller amount and recognizing the salability and scalability of the product and, simultaneously the potential of the business.
And with this concept, the entrepreneur benefits equally as well. Not only do they improve their product quality, but also understand the shortfalls of the product from practical feedback. This widens the scope limitlessly as this enables a window of almost flawless anticipation of the future.
So, is it like a Prototype of the product?
Although it sounds like a prototype, there is a prime difference between them. The prototype demonstrates the core concept of the actual product. It gives you the what and how of the product. An MVP is the next step where you develop a Beta version of the product to test its potential before investing a large chunk of time and money. So, a Prototype can be called a pre-MVP and an MVP is the best form of the embryonic product.
How did it become an entrepreneur’s messiah?
The world is full of problems and it’s the duty of an entrepreneur to fix them! Whether you are sitting in a park or taking a bath in your bathtub like Einstein, it all starts with a “Eureka!”. It marks a phenomenal moment when you finally identify a viable solution to a prevailing problem that had been detained in your head for ages and all of a sudden you feel butterflies inside your stomach! You finally believe that you might make it to the League of Big Bickies if you execute your idea well.
But just like Joey’s career cannot exist without Chandler, your project cannot turn into reality without sufficient Capital! And suddenly, the urgent need for seed funding overflows your mind. The only possible solution your brain figures out is to find an investor who will be able to see the vision you have.
But the problem is, that an investor will always have to consider the ROI before investing anything. And what’s more assuring than a test drive before finally putting money on the table?
That’s where an MVP becomes a Good Samaritan because once you build an august MVP that displays some impressive stats in the market, the investors will themselves seek to fund your product!
However, since you are not developing a doughnut, your MVP might require a notable investment in itself! That’s where the majority of our young entrepreneur gets stuck, figuring out an efficacious strategy to keep the wheel rolling.
MVP has gradually become the backbone of every modern startup because of its effectiveness and usefulness for both parties (investor and entrepreneur). Not only does it unmasks the hidden potential of the startup as well as the entrepreneur, but also it exposes the inadequacy. Hence, building a perfect MVP becomes as requisite as eating spinach for Popeye! Only when you ace the MVP, will you be able to actualize your vision and live the life you always dreamed of!