5 Things You Need To Know Before Building Your First MVP
How often do you find yourself coming up with new business ideas? I bet you do that every day. Coming up with ideas, or dreaming about a better future is how you build and grow a startup, it’s what makes you an entrepreneur.
But, sadly, that’s only a small part of what it takes. You need to put as many of those ideas to the test as possible until you either run out of money or you hit the jackpot. And to increase your chances of success, you need to make sure you find the cheapest way to test them.
Here are five factors you need to consider before you start building your MVP. They will help you keep your costs low and your learning speed high.
1. Make sure you have something people want
If you were to remember just a single piece of advice from this article, this would be it. Your idea is not the product. Your idea is an assumption that you should validate.
The way you validate your assumptions is, you put them in front of your target market and see if they become customers or not. Your target market is the only one you should trust to validate your assumptions. Not your gut, not your friends, and definitely not your mom.
It’s tempting to skip this step and jump directly into the building phase. The problem with that is once you’ve built it, you’ve already spent your budget, and now the only thing you can do is hope and pray that someone will buy it. It’s not a good position to be in. You can do a lot better.
The alternative is to plan ahead and spend your budget where it really matters. So for example, if you have three ideas, you test them all out by talking to your customers, to see which one resonates better with them.
Only when you’re confident that you’ve found something that people want, you can go ahead and move to planning and building. That way you’ll have a much greater chance of success, and you’ll be a step closer to building a product that people would pay for.
2. Hire the best talent you can find
I cannot stress this enough. Experience makes a ton of difference when it comes to building MVPs. You want the best team you can find because that’s how you’ll be able to:
- build a prototype really fast
- change course and adapt faster and cheaper
- grow the product by leveraging customer feedback
A really good team can build you a professional MVP. And by professional MVP I mean one that will optimize your investment in the long run. It’s very rare that you will find the thing that people want (or Product Market Fit) on your first try. After all, an MVP is just a set of assumptions that you want to validate (or invalidate).
All that means is, you’ll have to iterate over and over again until you reach product market fit. And the quality of your team will profoundly affect your learning speed (the time it takes to adapt your product to the feedback you get from your customers).
3. Create a product roadmap
A roadmap is a strategic plan that reveals business goals and high-level product capabilities. It helps everyone involved, including you, understand what the business goal(s) of the product are and what are the necessary steps to reach them.
It will help you visualize how your MVP fits the overall plan (which might include more than one MVP). It also helps to set the right expectations and roles from day one.
In essence, a roadmap will help you get a deeper understanding of the goals, budget and process required.
It should include the following:
- Product vision — What do we want to achieve?
- Goal — What benefit — users or business — are we looking to deliver and why?
- Features — A high-level view of what do we want to build
- KPIs — How do we measure success?
It can include the following (if coupled with a release plan):
- User personas — Who are we building this for and how will they benefit?
- User stories — What does the user want to achieve? What is their motivation?
- Mockups and sketches — What will the MVP look like and how will the user navigate it?
4. Define success (KPIs)
As previously mentioned, in the roadmap, you’ll want to identify some Key Performance Indicators (KPIs) that will guide you towards your goals.
By analyzing your KPI(s) and evaluating the effectiveness of your MVP, you’re able to make informed decisions about what to build next. And by knowing what matters, you’ll know where you need to spend your budget.
Let’s consider an MVP where the primary KPI is the activation rate (how many visitors are engaging with your app). So if you have 1000 visitors/month and 100 of them become active members by completing three activities, you’ll have a 10% activation rate.
So by observing this activation rate indicator, you’ll be able to focus your efforts on factors that improve it, like optimizing the user experience for example. Then, on your next learning cycle, you’ll know exactly if the new release had the effect you were hoping for or not.
5. Embrace change
Change is good. It’s what you should aim for from day one. After all, the purpose of the MVP is to tell you what you need to change to increase the value of your product.
By embracing the need to change mentality early on, you communicate to your team that the most important aspect of your MVP is to help you learn what works and what doesn’t. That is how you’ll increase your chances of building a successful business.
You’ll want to create a learning cycle, that you’ll use to improve your KPI(s). With each cycle, you’ll change the product either by removing features that make no sense or by adding ones that you think will improve the KPI(s). Again, and this is important, you’re using the KPI(s) to guide these changes, you’re not blindly building stuff and hoping for the best.
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Originally published at mixandgo.com on March 16, 2017.