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Getting to Minimum Viable Product (MVP)

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Building an MVP
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Getting to Minimum Viable Product (MVP)

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Every venture capitalist, board member and startup advisor counsels the entrepreneur to focus on building their minimum viable product (MVP). But how exactly does a company build out its MVP? Learn how the right framework guides your development from MVP to a mature product.

Every venture capitalist, board member and startup advisor counsels the entrepreneur to focus on building their minimum viable product (MVP). But how exactly does a company build out its MVP? Learn how the right framework guides your development from MVP to a mature product.

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Getting to Minimum Viable Product (MVP)

  1. 1. Getting to Minimum Viable Product (MVP) A Framework Created by Execution Matters – A Startup Advisory Firm § Sam Wong § Startup Advisor, Author, Interim Co-Founder; May 28, 2019
  2. 2. } Sam Wong – Startup Advisor, Author, Interim Co-Founder } Five-time serial entrepreneur } 1x CEO, 1x CTO, 3x VP Engineering / TechOps } 2 successful exits, 1 startup still thriving } 2 startup failures (and great lessons learned) } 21 Secrets of Successful Startups } Startup Execution } Startup Fundraising } Startup Talent } Startup Life Execution Matters Provides Proven Coaching 2 www.ExecMatters.com Sam Wong – Founder, Execution Matters; Author www.21secrets.biz Copyright © 2019, Execution Matters. All rights reserved.
  3. 3. Agenda }01 Introduction } The Importance and Challenge of Nailing Your Minimum Viable Product }02 MVP Framework } How to Approach Building Your Minimum Viable Product in a Startup }03 MVP Scope } How to Determine the Functionality for Your Minimum Viable Product }04 MVP Value } How Getting MVP Right Leads to Healthy Startups Copyright © 2019, Execution Matters. All rights reserved. 3
  4. 4. Introduction The Importance and Challenge of Nailing Your Minimum Viable Product01
  5. 5. 5 60% of Key Success Factors Involve the Product Copyright © 2019, Execution Matters. All rights reserved. Execution & Team Business Model FundingTiming Idea Product Founders need to pay careful attention to the product development as it affects the majority of a startup’s critical success factors
  6. 6. 6 But How Do You Get to MVP? “The MVP is the right-sized product for your company and your customer. It is big enough to cause adoption, satisfaction and sales, but not so big as to be bloated and risky.” - Frank Robinson CEO, SyncDev “Everything should be as simple as it can be, but not simpler.” - Albert Einstein Theoretical Physicist “The minimum viable product is that version of a new product which allows a team to collect the maximum amount of validated learning about customers with the least effort.” - Eric Ries Author, The Lean Startup Copyright © 2019, Execution Matters. All rights reserved. These quotes describe MVP, but do little to help you build your MVP.
  7. 7. } Not Enough Money Startup Challenges } Not Enough Time } Not Enough Resources Copyright © 2019, Execution Matters. All rights reserved. 7
  8. 8. Typical Early-Stage Startup Funding Journey Concept (Not Funded) Bootstrap Funded Seed Funded Series A Funded Copyright © 2019, Execution Matters. All rights reserved. 8
  9. 9. MVP Framework How to Approach Building Your Minimum Viable Product in a Startup02
  10. 10. Making Sense of MVP – by Henrik Kniberg Copyright © 2019, Execution Matters. All rights reserved. 10Source: Henrik Kniberg, https://blog.crisp.se/2016/01/25/henrikkniberg/making-sense-of-mvp
  11. 11. 11 Your Product Development Journey Copyright © 2019, Execution Matters. All rights reserved. Current State !User wants improvement Earliest Showable "User curiously enlightened Earliest Testable #User visualizes potential Earliest Likable $User’s life greatly improves Earliest Lovable %User becomes evangelist Earliest Usable &User’s life improves
  12. 12. 12 Getting to Minimum Viable Product (& Beyond) Example using a package delivery company Copyright © 2019, Execution Matters. All rights reserved. Current State Earliest Usable Earliest Likable Earliest Lovable Earliest Showable Earliest Testable
  13. 13. Phase 1: Current State Copyright © 2019, Execution Matters. All rights reserved. 13 ! Concept (Not Funded)
  14. 14. Phase 2: Earliest Showable Product Copyright © 2019, Execution Matters. All rights reserved. 14 ! Bootstrap Funded
  15. 15. Phase 3: Earliest Testable Product Copyright © 2019, Execution Matters. All rights reserved. 15 ! Seed Funded
  16. 16. Phase 4: Earliest Usable Product Copyright © 2019, Execution Matters. All rights reserved. 16 ! Series A Funded MVP * For this example, the earliest usable product is likely the MVP. Other businesses may designate an earlier or later stage as MVP.
  17. 17. Phase 5: Earliest Likable Product Copyright © 2019, Execution Matters. All rights reserved. 17 !
  18. 18. Phase 6: Earliest Lovable Product Copyright © 2019, Execution Matters. All rights reserved. 18 !
  19. 19. Evolutionary Phases of Product Development Copyright © 2019, Execution Matters. All rights reserved. 19* Content is illustrative only (your mileage may vary) Earliest Showable Earliest Testable Earliest Usable Earliest Likable Earliest Lovable Product Goal Get the foundation built, warts and all Get something usable, even with extreme limitations Get something in use, even with multiple limitations Get something that starts momentum Get something that accelerates momentum and builds fans User Benefit Little – barely better than existing state Very limited; slightly better than existing Somewhat better than existing with limitations Significantly better than existing Doesn’t just reduce costs, but creates value User Involvement Observation / feedback only; no hands-on Hands-on with only 1-2 specific use cases Hands-on use in very controlled environment Limited, hands-on use Generally unrestricted use Ideal User Reaction User curiously enlightened ! User visualizes potential " User’s life improves # User’s life greatly improves $ User becomes evangelist % Audience Size1 2-3 authoritative users with signed NDA Very limited handful of users with signed NDA; < 10 users Limited set of beta users; ~10-25 users Early release candidate; ~100+ users Actively marketed; 1,000+ users Delivery Truck Example Chassis and wheels only Add folding chair, steering system, brakes Add engine, fuel system; upgrade power steering and seat Add transmission, package shelving system; enclose cab Add truck body, wireless, GPS, lift gate; upgrade engine Ideal Timeframe 1-2 months 2-4 months 3-6 months 4-8 months 12+ months 1 Typical target audience size depends heavily on the nature of the product and risk of liability
  20. 20. Agile SprintsAgile SprintsAgile Sprints 20 So Where in This Will You Find the MVP? Copyright © 2019, Execution Matters. All rights reserved. Earliest Showable Earliest Testable Earliest Usable Earliest Likable Earliest Lovable Time Somewhat Uncommon MVP Most Common MVP Somewhat Common MVP
  21. 21. MVP Scope How to Determine the Functionality for Your Minimum Viable Product03
  22. 22. Typical Product Requirements Process Brainstorm Features Prioritize Features Build Features Copyright © 2019, Execution Matters. All rights reserved. 22
  23. 23. Typical Feature Brainstorming Process Copyright © 2019, Execution Matters. All rights reserved. 23 Christina Morillorawpixel.com
  24. 24. Typical Feature Prioritization Process Copyright © 2019, Execution Matters. All rights reserved. 24 Sorted Feature List Feature 3 Feature 2 Feature 1 1-Must Have 2-Should Have 3-Want to Have 1-Critical 2-Very Important 3-Somewhat Important 4-Somewhat Optional 5-Completely Optional 1-Must Have 2-Should Have 3-Want to Have 4-Nice to Have Prioritization Scale
  25. 25. Typical Feature Prioritization Result Copyright © 2019, Execution Matters. All rights reserved. 25 27 10 5 3 0 5 10 15 20 25 30 1-Must Have 2-Should Have 3-Want to Have 4-Nice to Have # Features by Priority Problem: How do you determine the features that go into the MVP?
  26. 26. Recommended Prioritization Method } Features should be evaluated on their: } Business benefit } Technical complexity } The combination of these two ratings combine to create a prioritization table } Tip: clearly define the criteria used to determine each individual rating } Example with technical complexity: Copyright © 2019, Execution Matters. All rights reserved. 26 1 2 3 4 5 2 3 4 5 6 3 4 5 6 7 4 5 6 7 8 5 6 7 8 9 Technical Complexity BusinessBenefit Low High LowHigh Grade Range Very Low < 2 man days Low 2-5 man days Medium 6-10 man days High 11-15 man days Very High > 15 man days
  27. 27. Nine-Point Prioritization Improves Accuracy 2 5 8 9 7 5 4 3 2 0 1 2 3 4 5 6 7 8 9 10 Priority 1 Priority 2 Priority 3 Priority 4 Priority 5 Priority 6 Priority 7 Priority 8 Priority 9 # Features by Priority Copyright © 2019, Execution Matters. All rights reserved. 27 Earliest Showable? Earliest Testable? Earliest Usable?
  28. 28. Business Benefit Value Costs Competition 1-Completely Optional Creates some value (1.1x?) Slightly reduces costs (10% less?) Not a factor 2-Somewhat Optional Creates wanted value (1.5x?) Reduces costs (30% less?) Maintains wanted parity 3-Somewhat Important Creates needed (2x?) value Reduces core costs (50% less?) Maintains needed parity 4-Very Important Creates substantive (5x?) needed value Dramatically reduces core costs (80% less?) Key differentiator 5-Critical Don’t even bother building the product if this feature isn’t included } Challenge: measuring business benefit is hard } Business value is often subjective } Solution: define your detailed criteria for assigning a grade } Possible criteria: } Value } Cost } Competition } Scalability } Interoperability } Availability Sample Business Benefit Rating Scale Copyright © 2019, Execution Matters. All rights reserved. 28
  29. 29. } Questions to ask: } Does the customer have this feature today? } What does the customer do if the feature is not built or ready? } How much pain does the customer feel if the feature is not included? } Is there a workaround if the feature is not included? } What if you only build part of the feature? Is there a way to split the feature into multiple sub-features? } Does any other competitor have this feature? } Is there another similar feature that is a reasonable substitute? } Is there a way to spec the feature differently to reduce its cost? } How does the business benefit of this feature compare to: } Another feature with the same business benefit grade? } Another feature with the next lower grade? } Another feature with the next higher grade? } Remove your emotions from the process, as they make wants appear to be needs Be Ruthless When Assessing Business Value Thinking very critically and making hard decisions improves the result Copyright © 2019, Execution Matters. All rights reserved. 29 Photo by Ivan Cujic
  30. 30. MVP Value How Getting MVP Right Leads to Healthy Startups04
  31. 31. Typical Startup Funding Journey Concept (Not Funded) Bootstrap Funded Seed Funded Series A Funded Copyright © 2019, Execution Matters. All rights reserved. 31 How do you know how much to raise?
  32. 32. Fundraising: How Much to Build a Home? } Estimate quickly } Aim high } Hope you got it right } Spend a little time to determine the scope } Spend a little more time to determine budgets for each cost category } Aggregate the individual costs and add a little padding Copyright © 2019, Execution Matters. All rights reserved. 32 Typical Approach Recommended Approach But hope is not a strategy!
  33. 33. A Thorough MVP Plan Impacts Overall Plans Copyright © 2019, Execution Matters. All rights reserved. 33
  34. 34. Which Climber is Prepared to Scale Mt. Everest? Copyright © 2019, Execution Matters. All rights reserved. 34
  35. 35. } Use a framework to guide progress to MVP Summary } Ruthlessly prioritize features } Move fast & leverage experts – lack of time & money work against you Copyright © 2019, Execution Matters. All rights reserved. 35 Current State Earliest Usable Earliest Likable Earliest Lovable Earliest Showable Earliest Testable 1 2 31 2 3 4 5 2 3 4 5 6 3 4 5 6 7 4 5 6 7 8 5 6 7 8 9 Technical Complexity BusinessBenefit Low High LowHigh Concept (Not Funded) Bootstrap Funded Seed Funded Series A Funded
  36. 36. www.21secrets.biz www.execmatters.com

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