Lean Startup and the idea of building MVPs was a great first step towards better startup efficiency, but it didn’t go far enough.
In 2011, Eric Ries published a book titled The Lean Startup. In it, he popularized a concept he called MVP (minimum viable product).
The basic premise of an MVP is that it is a more efficient approach to launching businesses than what entrepreneurs had been doing. Specifically, in the past, entrepreneurs spent a lot of time and money creating a final, polished version of the products they wanted to sell, and once created, they were ready to launch their companies.
Ries believed that this “perfect product” approach to entrepreneurship was ineffective. Instead, Ries taught founders to build minimum viable products, a kind of bare-bones version of what a product ultimately hopes to become, as a way to test and learn.
Let’s give credit where it’s due: the concept of creating MVP was a great and hugely important evolution in startup culture. It certainly reduced enormous amounts of inefficiency and waste in the startup world.
But just because something is great doesn’t mean it’s perfect. In fact, the MVP approach to building startups is far from perfect, as it still encourages a lot of inefficiency. It’s time for entrepreneurs to move beyond MVPs and adopt an even more efficient and effective process for validating startups.
In order to appreciate a more efficient process than MVP creation, let’s start by understanding why MVPs are not as efficient as they seem.
The ineffectiveness of the MVP approach in startups is due to a misunderstanding of what a minimum viable product should really be. Many founders believe that an MVP is about creating the simplest possible version of a product. In other words, they think that stripping a product down to its essential features makes it an MVP.
But this is not entirely true. Creating a minimum viable product is not about creating a minimum number of functions, but about reducing the entrepreneur’s effort to a minimum.
To be clear, I don’t mean minimal effort because entrepreneurs are lazy and don’t want to work hard. I mean minimal effort for the sake of speed. The goal of an entrepreneur in the early stages of launching a new company should be to test the riskiest hypotheses of the concept as quickly and cost-effectively as possible. As a result, a true MVP should be the quickest way to start learning, not the quickest way to start building.
This is where the concept of MVP (minimum viable product) becomes problematic. Specifically, the problem with the concept of an MVP is that it still encourages entrepreneurs to build some type of product.
Any type of dependency on building a product is ineffective because the quickest path to knowledge has nothing to do with product development. Running landing page tests, interviewing customers, posting explainer videos, distributing pre-orders… all of this will teach you more with less work than the most basic product prototype.
In other words, in the early phases of new business creation, entrepreneurs should not think about products at all. They should be thinking about how to demonstrate the existence of a market opportunity. And that is done by identifying clear demand signals.
Demand signals are exactly what their name suggests: signals from the world at large that there is a real need (i.e. demand) to solve some type of problem. After all, that’s what entrepreneurship is all about: solving problems, so MVPs are pointless. By definition, MVPs are solutions. Solutions are great, but they’re only great once you’re sure you’ve found a significant problem, something entrepreneurs can do without building any kind of solution.
For example, you can create a basic landing page explaining the concept of your product and see how many people subscribe to a newsletter or mailing list. And you can run targeted Facebook ads on the landing page to measure interest and collect intent data.
The goal of this type of testing is to simulate the core value proposition and see if it resonates without actually creating an actual product. Do people click? Do they convert? Do they give their contact information? These demand signals are the first validation. No product is necessary.
Once you have the first signs of demand, you won’t need a product. You can follow up with interviews, surveys, and pre-order pages to further qualify interest. Get potential users on video calls and tell you exactly why they clicked on your concept. Identify your weaknesses and motivations.
In other words: learn! Learn, learn, learn before the word “build” crosses your mind. Your goal shouldn’t be to create a minimal version of your product as quickly as possible, which is what Lean Startup teaches. Your goal should be exactly the opposite: postpone product development as long as possible.
Always remember that building is expensive, and testing is cheap. So let’s throw out the marginally improved but outdated MVP strategy and replace it with something much more efficient: minimum verifiable learnings. It’s a strategy that emphasizes learning what people want first, and then building a potential solution second, which is exactly what entrepreneurs should be doing. After all, entrepreneurship is not about building for the sake of building. It’s about understanding problems to offer solutions that people really want.
