How Building An MVP Helped Me Achieve Success
The story of the product that generated most of the money for my company.
“If you are not embarrassed by the first version of your product, you’ve launched too late.” — Reid Hoffman
One reason entrepreneurs cannot make money is that they take too much time to finish their products. They want to build something perfect; they don’t know when it is the time to stop and launch what they have.
I founded a gaming company in 2012, and it took three years for us to become profitable. Not all the games we did worked, but we would have wasted much more time if we didn’t have learned about the MVP.
An MVP (minimum viable product) is a product version with just enough features to be usable by early customers who can then provide feedback for future product development. You may be building something that people don’t want to use. Launching an MPV allows you to learn faster and determine if you should keep working on your project or what you can improve.
The MVP practice became popular with Eric Ries' book Lean Startup and is used mainly in the initial business phase. That allows entrepreneurs to validate their idea before developing the final product. In other words, it will enable you to find out if it actually solves the consumer’s problem. The MVP is a set of preliminary tests designed to validate the viability of the business. Despite being worked with as few resources as possible, it needs to maintain its solution function to create and deliver value to the customer.
I started my first company with three partners in an office. After two years of working long hours but few results, they gave up on the entrepreneurial journey. During this period, besides doing work for hire projects, we launched two games. Unfortunately, both games didn’t work out financially.
When my three partners left the company, we had just launched the third game. At that time, I was changing the company focus, and when I became the sole partner, I decided to bet on that game. I decided that I would get rid of the office and stop doing work for hire projects to focus on our new game.
Our third game ended up being the game that most generate revenue for the company. I couldn’t know that when I launched it. It is the game that changed the history of my company. It took a bit more than one year to generate enough money to pay all the company bills. Nothing of that would have happened if I didn’t start with an MVP.
Validating the product
The name of our third game is Letters of Gold. It is a word search game where you have different challenges to beat while looking for words. The game follows the same idea of multiple levels that Candy Crush uses (you have played that game, haven’t you?).
I used to be a programmer at my first company, besides being the CEO. After I developed a demo for the game and showed it to the people working with me at that time, I started to think about what we would need to have in an MVP. My company wasn’t profitable, and I didn’t have the time and resources to do anything fancy.
The MVP function is to reduce some risk factors, especially the market, which will tell you if people really want your product. The MVP is also useful for staying in touch with your target audience and learning what you can do to improve the product.
As we wanted to develop a game with multiple levels, like Candy Crush, we decided to launch a game with 20 levels (which is something very small comparing with games that had hundreds of levels). We would learn if players would get to the end of the game. If they did, that was a good signal; if they didn’t, at least we didn’t invest too much time and still could learn with the project. It took us three months to finish the game, and its version was launched during a conference here in the south of Brazil in October 2013. The game was available on Facebook and could be played in Portuguese only.
I attended the conference with one of my employees. We had three days to see people playing and learn with that. At the same time, we shared our new game to our network, and we could learn from data about how people were playing. The goal for the first week wasn’t to make money, but to learn if we would continue improving the game or not.
After the conference was over, we analyzed the data we had and decided to keep working on it. We had some bugs to fix and some things to improve. We improved the current levels we had and, as we saw some people getting to the end of the game, we also added 20 more levels. We started promoting the game more heavily and analyzing the data from time to time to find ways to improve it.
The numbers for the game were promising. It started to make some money, but nothing that could pay all of our bills yet. We spent 80% of our time improving the things that we already had developed based on the data we had, and 20% adding new features. As the game was just available in Portuguese, it was easy for me to talk to the Brazilian players and learn how to improve the game.
The turning point
In the middle of 2014, I applied for an accelerator program for startups. As the game had good traction, I believed we could be accepted into the program and then keep working on the game so it could finally pay all of our bills. We were running out of money. If we weren’t accepted, we probably would have died.
Fortunately, after a few weeks, I received an email saying that we were accepted to participate in the Startup Chile program. This accelerator program for startups is an initiative from the Chilean government. It helps companies with US$40,000 (equity-free), working spaces, and mentoring. Thanks to the money we got, we could improve our game and invest more in marketing to reach more people.
I lived in Chile for seven months (from November 2014 to June 2015), and I tried to work 100 hours per week to transform my startup into a profitable one. After six months there, we had learned a lot of things, improved the game, and added a ton of new features. However, it still wasn’t enough to make money to pay for all of our bills. At this point, users could also play the game in Spanish and English, but we focused the advertising on the Latin American market.
As we got to the last month of the program, we decided to try something different. We would run out of money if our game didn’t start to generate enough cash. We still had some money that we would use to pay the next month’s salaries of my two employees. We decided to change our marketing focus on Latin America to the US and bet the rest of the money we had on advertising. Our traction had improved a lot during the past six months. The main problem we had was that the Latin American players didn’t like to spend money on games on Facebook. Betting all of our money on advertising was risky, but we believed that the US players would spend money.
Fortunately, our bet worked. We started to make much more money, and we ended up becoming a profitable company. We had money to pay for all of our bills. None of this wouldn’t happen if we didn’t start with an MVP. Much of the failure of startups is the lack of product validation. They spend a lot of time and money on solutions that are not as worthwhile as they would like.
After the success of Letters of Gold, we launch four more games that also started as an MVP and were improved as we learned what to do. All of our products changed a lot since their first release. All of this allowed us to grow, hire more people, and increase everyone’s salaries.
What is the version of your product that you can launch as soon as possible?