By John Peltier
The Lean Startup movement led by Eric Ries has put the concept of minimum viable product (MVP) into the current vernacular, and certainly into Shardul’s vocabulary. 🙂 An MVP is generally understood to be a product that has just enough functionality to validate that you’ve found market problems buyers are willing to pay to solve, and that your offering solves the problems effectively enough to capture some of the market. This is an attempt to avoid over-building a solution, and solving problems that buyers don’t actually have.
Conducting a full-scale launch of an MVP can be both rewarding and dangerous.
Fraught with Peril
One area of danger is building an MVP that best fits a segment of the market, but selling the solution to the entire market. Buyers from multiple segments force language into their contracts demanding their most critical features, partially solving problems for multiple segments but delaying fully solving the problem for any segment. This makes it more difficult to get glowing references, since buyers from all market segments perceive gaps for a longer period of time.
Another danger is defining your MVP by the functionality needed to demo, versus the functionality needed to use. Teams may be tempted to defer under-the-hood capabilities until after release, especially when feeling the pressure of time-to-market. This gets you to market faster, but with a product that has known gaps.
As things progress, Sales meets resistance due to needs not met in your MVP, and starts bargaining for delivery promises to win deals. Meanwhile, this can crowd out bandwidth to close the gaps–which represent under-the-hood capabilities all buyers will need. Once you say yes to a few deal-makers, you can’t say yes to any more. This will also strain the relationship with Sales.
One way to adjust is to proactively include fewer big-ticket items on the roadmap, while allocating some percentage of capacity to under-the-hood needs. At some point your estimations won’t line up with reality, though, and you’ll have to escalate something that everyone assumed was already there. The silver lining is that these episodes–often a response to onboarding needs, and sometimes useful in winning an early reference–can be used later as an example of why you need to invest in the engine!
A Focused Solution
On the other hand, selling an MVP delivers revenue at perhaps the earliest possible date. Prospects who don’t need all the bells and whistles encounter a solution that meets their needs, without having to wait for you to build feature after feature that they don’t need. Early adopters likely wouldn’t wait for you to deliver your solution; it’s much more likely that they purchase another vendor’s solution. The other vendor’s efforts to increase the buyer’s switching costs will then make it difficult for you to get that prospect at a later date.
As early adopters, your first clients get to help you decide which 15% of the hundreds of possible features you actually need to build. While a market is much bigger than a handful of early adopters, some effort towards satisfying their needs is warranted if it can deliver you early references, and especially if the things they need are known needs you’ll have to address at some point in the product’s development.
These benefits carry an important condition: the MVP that you provide must solve the core needs well. Adequate won’t win over prospects with lesser needs, and it won’t convince early adopters to provide glowing references. Prospects will need to be convinced that your solution is already so good, that it’s in their best interest to come along with you for the ride.
Depending on the quality of your execution, the early days of being in the market with an MVP can be both hairy and immensely rewarding. What other benefits or drawbacks do you encounter when going to market with an MVP?
John Peltier is an accomplished product manager and marketer working in the growing technology community in Atlanta, Georgia. John shares his passion for product management by organizing ProductCamp Atlanta, and by writing at The PM Vision. John is most easily contacted on Twitter at @johnpeltier.