WHAT IS AN MVP AND WHY IT IS ESSENTIAL FOR YOUR DEEP-TECH STARTUP
Early stage startups usually have many ideas but few certainties. At this stage, in fact, the nascent startup has only one objective: to understand whether or not the solution you want to propose is the solution suitable for the market addressed.
When it comes to product-market-fit, the essential tool to test and validate your solution is the creation of a Minimum Viable Product (MVP).
In this article, you will find out what is an MVP i where it comes from and how it changes for deep-tech startups.
What is an MVP and where it comes from?
Creating an MVP for a startup means creating a minimalist version of your product and/or service, that contains all the essential features characterizing the idea behind everything. An MVP is generated with low expenses and the basic characteristics that are sufficient to test the idea immediately with potential customers, by placing it on the market and obtaining the useful feedback that can improve it.
The term was coined for the first time in 2001 by Frank Robinson, co-founder of SyncDev, to indicate that product with the largest Return on Investment (ROI) compared to risk. However, to make the term popular were Steve Blank and Eric Ries, founders of The Lean Startup Movement.
An MVP does not include the creation of a working solution only for half, but it has to be essential and minimalist, therefore a pilot solution to start your startup in a smart way.
Creating an MVP is essential because it allows you to launch your product and/or service in a strategic way while taking into account your target audience, testing it quickly and understanding how to improve it.
So, what are the essential characteristics of an MVP?
First of all, the product must have a minimum value with features that the end user can use cocnretely.
Although minimalist, an MVP must immediately showits current and future benefits, so as to convince the initial user to continue using it until the features are actually complete.
The early adopters have a great role for the improvement of the MVP, as they will be the ones to provide feedbackthat will allow the future developments of the startup.
The realization of the initial idea, moreover, should take place with minimal resources and trying to reduce as much as possible the development and design hours, in order to reach the first customers in a rather short time.
To conclude, an MVP should also be able to provide a quick estimate of the possibilities of a new brand.
Are you a deep-tech startup and want to see your innovative idea kick-off?
5 steps of an MVP ideation
These are the 5 stages necessary for the creation of an MVP that is functional and durable, more specifically:
- Start from research to create the idea
The idea behind the startup should always be based on precise research, which will help to deepen the needs and problems that the idea will be able to solve.
The startup should define the essential features of the product and/or service by taking into account the characteristics of the final user.
- Essential features
Although for the overall idea the characteristics may be multiple, only the essential and top priority characteristics should be selected for this phase of the MVP. Preference should be given to those able to satisfy initial users and who have the possibility to evolve in the future.
- Create the product
At this stage, it is necessary to create a product that reflects all the points previously expressed, so as to give a real value to the user.
- Feedback, feedback, feedback
The opinions of the first users will be essential to validate the idea, improve it and finally give life to all the other features that will make your startup complete.
Can we say MVP for deep-tech?
After identifying a problem to be solved, highly technological solutions usually require a high capital intensity, therefore much larger investments to develop even the first phases of a prototype.
Many deep-tech enterprises, or aspiring ones, encounter obstacles even to reasoning and hypothesizing a possible innovative idea, aeven before thinking if they can produce it at a competitive price. Non-deep-tech startups, on the other hand, rarely encounter these risks and often focus exclusively on product, market and growth challenges.
The solution lies in investments. This is a challenge for the ecosystem, considering that the amount of investors open to risk for such innovative realities is relatively small compared to the funds that patrol the ecosystem of early stage startups more generalist.
While the interest in deep-tech continues to grow, there is still a need for forward momentum if high-tech companies are to take off. In fact, we often talk about technological attraction as a a tool to overcome the enigma of the solution. Less often, however, connecting points are created between industry, investors and researchers in which one can question the vulnerabilities of these disruptive technologies and better understand the paths of research and development.
The solution is to apply a pragmatic approach to valuations, that, in the absence of cash flows, goes beyond traditional financial modelsand would help pave the way for the financing of exponential and highly innovative technologies.