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“Minimum Viable Product:” What It Is & How To Build One

If you’re gonna build a hot dog stand, what are the few key things you need to focus on?

I grew up in New York City where the hot dog guys had to have a minimum of a good wiener, fresh bun and mustard

The weiner will probably be first…then the bun…then some mustard and then a stand or cart, right?

If those four items weren’t satisfactory, your hot dog stand would be in big trouble.

Surprisingly, most businesses don’t take that same sensible approach.

Note: thanks to the 37Signals guys who wrote the entrepreneurial-focused Rework book for that hot dog stand analogy!

Minimum Viable Product

My definition of  minimum viable product is the minimum amount of functions needed to provide speedy feedback to determine the viability of a product.

Let’s break down these words:

Minimum

There is usually just one or two core problems that excellent products are trying to solve.

An iPod lets you store a bunch of your music and play it on the go; Facebook lets you find friends and share information with them; eBay lets you sell used stuff or buy used stuff; and Google lets you find information on the Web.

Viable

What makes a product viable?

There are typically two things:

  1. Will people use it?
  2. Will someone pay for it?

Product

And just to be clear, when the word “Product” is used in Minimum Viable Product, we are referring to any creation such as:

  • A commercial product
  • A service
  • An entire business
  • Any organism that generates value!

Examples of Minimum Viable Products

My favorite example of an MVP is of Cars Direct from this Bill Gross Interview (about 1 hour & 20 minutes into it!).

CarsDirect.com didn't launch their service with a fleet of cars

CarsDirect

Gross explains that back in 1998 when Cars Direct — perhaps the first site online to test selling cars — was launching, there was really just one thing that they wanted to test about their idea:

“Would a consumer pay for a car online with their credit card?”

Keep in mind that this was 1998 and people (including me) were nervous about putting a credit card online for more than just a book from Amazon or CD from CDNow.

After launching one night, the Cars Direct team woke up the next day to 4 cars being purchased!

Gross explains that because the single most important questions to ask was: “Will consumers pay for a car online?,” the rest of the Cars Direct feature set (at launch) could be minimal:

  • You don’t need actual car suppliers hooked up to an inventory system (the Cars Direct team could go to a dealership themselves and buy a car and drive it to the Cars Direct consumer!)
  • You don’t need the best automobile search engine (just give them enough options to pick a car…any car!).

Here are some additional minimum viable product approaches used by other companies at their dawn of their creation:

Virgin Air

They started their airlines with just one Boeing 747 flying between Gatwick and Newark.

They could have started with multiple planes and routes but stuck to one plane, one route.

Virgin started off with just one plane...but, man, was that plane an experience

Groupon

Groupon reportedly started out as just a WordPress blog with coupons available in PDF form.

Yahoo

Yahoo began as nothing more than a page of links off to other Web sites.

They didn’t even have a search engine out of the gate!

Business-To-Consumer SaaS (using just PhotoShop and a Letter of Intent)

An anonymous B2c SaaS platform idea with nothing more than a few screenshots which they showed to a few potential customers who signed a letter of intent to try the product for free and then pay X for it at Y date if it met certain expectations (source: Lean Startup).

Brilliant!

Apple iPhone

Even Apple — known for elegant products and a perfectionist CEO — applies the minimum viable product philosophy:

When the iPhone launched in 2008, it left out Cut-And-Paste and searchability of contacts, two features that many felt were important.

While Apple fans complained, these two features weren’t really core to the product’s viability. What was core to the iPhone’s viabiility was: 1) It could be used as a phone; 2) It could access the Web and 3) It could take pictures.

How To Build A Minimum Viable Product (e.g. Creating An Online Zoo)

Step 1: Create The Vision — The minimum viable starts with you picking your overall vision for a product.

For example, let’s say we want to build an online zoo (I just visited the San Francisco Zoo and believe we can do a better job of connecting humans with wild animals than that!).

So, my vision for a new zoo is that we make it an online zoo in which we anyone with a Web connection to see wild animals close up and in their own environment (not cages!).  I believe this is possible through tiny web-cams that we can install in the wild (near the animals) or on the animals themselves!

Simple enough.

Step 2: Is It Viable? – Now we have to ask ourselves:

“What do we need to test to prove that this is a viable idea?”

I suggest the following are a few of the most important features/functionality of such a service:

  • Can we actually install a web cam on or around a wild animal…and get decent footage!?
  • Will people be interested in watching the footage of a wild animal in its own environment?
  • Will someone pay for this service (either viewers paying to see it or advertisers paying to sponsor it).

Step 3: Craft The Prototypes — Now you should brainstorm the best minimal viable product prototypes.

Here’s one example of a prototype:

  • Let’s ask our park ranger friend to install a web-cam in the den of a bobcat that I keep seeing on Tennessee Valley Road hike in Marin, California.
  • Let’s email all of our friends and ask them to visit BobCatsGoneWild.com to view our edited footage (for a fee of $1 that they pay online)
  • Let’s ask local San Francisco pet shops (and the Zoo itself) if they would sponsor the show for a nominal fee of $100 (BobCatsGoneWild might attract only a niche audience!).

That sounds like a lot of work, so you may choose to get even more minimal about the prototypes. Examples:

  • Install web cams near where your domestic cat hangs out all day (just to test if the quality of the footage is decent) or
  • Buy some ads on Google or Facebook and send traffic to a Web site called “BobCatsGoneWild” and then when the visitor is there simply ask them to sign up for the early VIP list to see footage of a bobcat (this will help tell you whether people are even interested).
  • Make photoshop-type screen shots of a BobCatsGoneWild Web site and ask local pet stores/the Zoo if they’d pay $500 to sponsor such a Web event if 500 people showed up.

Step 4: Test The Prototypes

Finally, you have to pick one of your minimum viable product prototypes, launch it and quickly gather feedback.

Then, if you’re like most new creators, your product won’t be a runaway success.

Step 5: Iterate – You’ll have learned a bunch and you’ll go back to the drawing board to iterate.

That means you’ll select an even better next minimum viable product to test out (i.e.  walk through the four steps once again).

And keep on iterating!

Other good articles on how to build a minimum viable product include:

Ash Maurya’s “How I Built My Minimum Viable Product” (about photo-sharing).

 

2 Comments

  • http://sparknlaunch.wordpress.com/2012/04/18/building-a-minimum-viable-product-mvp-in-one-day/ Building a Minimum Viable Product (MVP) in One Day « Spark 'n' Launch – Biz Startup Tech

    [...] Rob Kelly simplifies it even more by breaking down the individual components as follows: [...]

  • http://ifigure.de/learning-from-our-launch-206.html Learning from our launch | I FIGURED OUT

    [...] the Lean Startup and all the blog post about launching an MVP and really convincing yourself and the team to launch a product that is not complete and does not [...]