What is a Minimum Viable Product?
According to techopedia.com, “A minimum viable product (MVP) is a development technique in which a new product or website is developed with sufficient features to satisfy early adopters. The final, complete set of features is only designed and developed after considering the feedback from the product’s initial users.”
Here at Metisentry, we work with many SaaS startups who are unfamiliar with the concept of the MVP and what value it might potentially offer.
How an MVP Benefits SaaS Startups
Most of the SaaS startups we talk to have grand ideas for their SaaS applications, but lack funding to bring their full vision to life. In most of these instances, we recommend using their initial funds to develop a minimum viable product.
The MVP is a functional (initial) version of the application, but the enabled features are typically only those which are necessary to allow the app to perform its core function. Benefits of building an MVP include:
Proof of Concept - When new SaaS companies are in their early development stage, a pitch deck and SaaS app concept will only go so far. Potential investors want to see a functional model of the application with active users. Only when they see demand being met in the market will they be excited and eager to fund a round-two investment.
Viable Product to Sell - SaaS MVP's are fully functional applications which subscribers can realize value from using. These early adopters provide valuable usage data for the development team and revenue to support the continued development of the app.
User Feedback - This is perhaps the most valuable piece of the MVP. User feedback will allow for speedier bug-fixes and will offer real user data and requests for new feature additions and upgrades.
Pricing Model Testing - MVP allows developers to offer and test different pricing models to determine what will best fit the market and their product.
The Big Win
SaaS startups who begin with an MVP are positioning themselves for greater long-term success. The MVP acts as a product validation tool and often instrumental in determining if there is sufficient demand for it in the marketplace.
MVP offers development teams the ability to better forecast and refine feature development and upgrades based on user feedback. This can significantly accelerate speed to market while allowing owners to spend funding dollars on features users actually want.
The MVP acts as the foundation from which many successful apps are built. For example, Groupon.com started as a simple Wordpress blog that would post daily offers and email those who requested one a PDF coupon. Once the concept was validated (by the early adopters), Groupon exploded into what we all know it to be today.
If you’re a SaaS startup with an idea or pitch deck, consider using your seed money to develop an MVP. The team at Metisentry is well versed in MVP development and can help you bring the minimal version of your vision to life. For more on planning, building, and growing your SaaS application, download our eBook below.