Through the course of my work at New York Startup Lab, I’ve had the privilege of interacting on a regular basis with early-stage entrepreneurs who are looking to get their projects off the ground with a little help from our company. These entrepreneurs often come to us with not much more than a basic plan and a ton of passion. Our job is to get our partners to minimum viable product (MVP) as quickly and cheaply as possible so that they can hopefully do a combination of three things:
- Prove the concept/get some traction
- Build out the team
- Get funding to bring the project to scale
The concept of the MVP has been well-defined by those much smarter than myself, but the application of its principles has only been loosely upheld. Through being involved in the launch of over 50 products in the last several years—some successful, most failures—I have picked up some insight on where there are holes in the thinking of some entrepreneurs, and have experienced firsthand what happens when someone becomes too product-focused.
Related Article: How to Create a Minimum Viable Product
As Reid Hoffman says: “If you’re not embarrassed by the first version of your product, you’ve launched too late.”
Rapid Iteration is Key to Customer Engagement
When you are first launching an MVP/prototype, you really have zero idea of how the target market will react or who your early adopters will be. You may think that you have an understanding of your user base, but the truth is that you probably have no clue. It really does not matter how much market research you’ve done. Those customers whose doors you’ve knocked on about a hypothetical product tend to disappear once you ask for a check. This inability to forecast the future accurately has paved the way for “the pivot.”
There are a number of factors that govern the success of technology products and they have more to do with execution than with market research. You may be targeting soccer moms in the Midwest, but your actual user base could be warlords in Ghana. Take the case of my company, AlleyWatch. We launched it as a New York-centric publication, expecting our readership to be comprised of the tri-state area, with some in the Valley and in a few other tech hubs across the country. It is now being read in 200+ countries. Surprise—yes! Deal breaker—no!
The beauty of technology is that it allows for rapid iterations based on actual data, which allows you to respond to your user base. And a responsive mindset can drive engagement. We aren’t in the business of building board games that have long shelf lives and even longer update cycles. Facebook has a very mature product that is constantly iterating not only to introduce new features, but if a ton of people are griping about the latest version, that means they are engaged and using Facebook. Believe me, this is by design. People get bored of the same thing: Rapid iteration increases engagement.
Don’t Waste Time on Features
While you can gain and lose knowledge and capital, time is a commodity that none of us are getting back. Your time should be spent getting a core product out to market as quickly as possible and not spent obsessing over small features that your users may never use. There are hundreds of cases of where bad technologies have turned into good businesses, and where stellar technologies haven’t become viable businesses. The difference lies in execution.
It is important to remember that when iterating, for all those who asked you to tweak a function, there are just as many who are happy with the way things work now. They don’t speak up because they are content. A basic statistical analysis of reviews will indicate that people are more willing to complain rather than to compliment.
I’ve learned the hard way that it takes an incredible amount of hubris to push out a product that you think the market needs because of your infatuation with building this perfect product. The idea that you can’t roll it out without X feature because it will be incomplete. Most of the time, this feature really isn’t critical for your go-to market strategy.
I have a close friend who was an early employee at an exciting company. Armed with some new cash, he set out to launch his own startup. He spent two years building what essentially can be considered the equivalent to Airbnb. He was neurotically fixated on every detail of the product, making sure that it was perfect and “ready to be acquired.” In those two years that he spent nurturing this product, Airbnb swept in, took the market and essentially killed my friend’s business and savings. While he was there first, he didn’t execute and now he is the proud owner of a very expensive technology that has no commercial viability.
Start With the Basics and Hustle From There
What you really need is a basic product that you can actually go out and put some hustle behind. The cost of hustle is negligible. With the technology stack moving towards modular components, the cost of getting a functional prototype is a fraction of what it once was. If you are building the engineering equivalent of the Mona Lisa that will change the world, you may be required to get that $25 million round. But for 99 percent of startups, technology is a means to execute on an idea that solves a problem, and that input is becoming commoditized rapidly.
You can build the Ferrari of products, but your audience and monetizable users may be Lamborghini aficionados. Start by building a Chrysler 300M—aka a “Baby Bentley”—and go from there. Your business will be more viable.
A version of this article originally appeared on AlleyWatch.
This article was originally published by Startup Collective
Author: Reza Chowdhury is the founder and CEO of AlleyWatch, the largest media property focused on the NYC technology ecosystem. Recognized as a thought leader, Reza was recently named one of the 100 most influential people in NYC Tech by TechWeek and is a 2015 NYC Venture Fellow, a world-class, year-long fellowship program designed to help high-potential entrepreneurs scale their ventures. He holds an MBA in Finance and Entrepreneurship from Georgetown University and completed his bachelors in Economics at the University at Albany.
Published: May 20, 2015