Minimum Viable Product

Despite the popularity of the MVP (minimum viable product) concept, most product managers and teams still don't understand its real meaning.

Most PMs think of an MVP as the first iteration of a product. That definition is WRONG.

Instead, MVP is a method to:

1. Test key assumptions (or validate key hypotheses)
2. Maximise learning with minimal effort
3. Validate what customers need

Test Key Assumptions

MVP is about validating assumptions, and it is NOT about the features or solutions to build.

A good MVP will help you validate critical assumptions with the least amount of time, effort, and resource investment.

Dropbox's journey is an excellent example of this. Instead of building an elaborate cloud storage platform, they began with a simple video demonstration showcasing the concept of their product. This allowed them to validate their assumptions about user demand before investing significant resources into development.

Maximising Learning with Minimal Effort

Remember: MVP is a learning tool. Thinking of it any other way is noise.

The goal of this tool is to maximise the learning per unit of effort invested. When MVPs are done well, they help you quickly learn what works and what doesn't, so you can use the real-world feedback to iterate more effectively.

This approach not only saves time and money, but it also provides a strong foundation for future product iterations and enhancements.

For example. Airbnb started with the below basic website design, which had a few listings. The goal: test the hypothesis that people would be willing to rent out their homes to strangers.

Validating What Customers Need

Good MVPs will validate customer demand.

Once you put a basic version of the product in front of users and analyse how they respond to and use it, you will get real-world feedback. This feedback will give you the required evidence to decide if you should invest (or not) in the idea.

Example: when I launched my first digital product. I tweeted this.

At the time, I didn't have a real product. I just had this Notion page.

Despite this, 50,000 people saw the tweet, 160 liked it, and almost 50 people paid for it the same day. By the end of the second day, I had 100 paying customers. Clearly, there was enough evidence that people wanted this product. That is when I decided to invest 100+ hours in creating it.

(I would have hated to invest 100 hours of my time into something, and then have no one willing to buy it.)

That is how I use MVPs -- as learning tools, and NOT development tools.

Every time I think of creating an MVP, I ask: "What am I trying to learn, and how can I learn that with the least investment of effort and time?"

Next, let's understand how to measure success of an MVP.

How to measure success of an MVP

For every MVP, have a very clear hypothesis. And the hypothesis should have a clear success criteria. If the success criteria is met, the MVP is a success.

If you do not have a hypothesis or a success criteria, you will NOT LEARN (and your MVP will fail.)

Let’s put this into the context of the above example of my digital product.

1. Hypothesis: PMs will want to improve their written communication by buying this toolkit.
2. Success criteria: get >=50 orders in the first 48 hours.
3. Secondary metrics: gauge demand based on user engagement (likes, bookmarks, DMs)

An MVP without a clear hypothesis and success criteria is already a failed one.

Okay, so now we know what MVPs really mean and how to know if they’re successful. The last thing I want to talk about is the additional benefits of doing MVPs right.

Benefits of doing MVPs right

1. Mitigate risks: MVPs help in testing assumptions early, so you can identify problems and adjust course. This reduces the risk of failure.
2. Conserve resources: MVPs give you confidence in the success of an idea before investing in it. This allows you to wisely allocate resources based on what you think will work.
3. Accelerate time-to-market: MVPs enable quick feedback cycles, which allows for quick iteration. This reduces time-to-market and increase chances of success.
4. Fostering an experimentation culture: using MVPs to inform product direction, enables the team to appreciate the value of experimentation.

That is all I have on MVPs. Let me know how you use MVPs in your role and if there is anything that you particularly liked in this guide.