Let’s face the hard truth: 99% of all startups fail. If you’re an entrepreneur or involved in a startup, this statistic is neither surprising nor disturbing but just a hard reality. What many entrepreneurs and startups have not accepted, however, is that much of this failure can be attributed to the way they are going about doing business.
It calls for a serious change in the approach entrepreneurs take to while building businesses and the associated technology.Gone are the days of spending valuable production time on writing up complicated business plans, pitching it to potential investors, gathering your team, and then waiting until the product has been “perfected” before even exposing it to your target consumer base. Instead, many successful companies are adopting what is known as the Lean Startup development process, a strategy of garnering feedback throughout the development process that was first envisioned by successful entrepreneur Eric Ries in the early 2000s.
It’s a strategy that will guide a startup more effectively through the early stages of product development, so that by the time the final product hits the market, the probability is high that the product will best meet the needs of the target audience.
A different strategy from the start
Rather than basing your entire business model around a product that you think needs to be built, Lean Startup strategies instead start with two questions:
1. “Should this product be built?”
2. Secondly, and more importantly for the future success of your team, “Can we build a sustainable business around this product?”
From these two questions, the development team will then begin to engage potential customers in a “discovery” process to gauge interest and refine the initial Proof of Concept (PoC) your team will be pursuing.
Less stringent than a business plan, a PoC becomes the first tool to draw investors to your project. It shows potential supporters that you have gauged the potential market for your product, refined your idea, and will be providing a product that has proven at the research stage to be a viable pursuit. Once the PoC is refined, it’s vital that your team then initiates the core lean development cycle known as the “build-measure-learn” feedback loop.
The cycle of improvement
With proof of concept firmly in mind, your team will first enter the build stage of the feedback loop and create a minimum viable product (MVP). Rather than a complete product with all intended features included, the MVP should be intentionally limited in scope, including only the core features you feel are most important to your product and your audience. A misconception at this stage of those deploying a Lean development strategy is that the MVP can be a substandard product. This will only serve to drive away the early adopters that will become the foundation of your business. Therefore, a key to getting successful data from the MVP is that, even though it might only include several of the core features intended for your final product, it still must be a fully functional product. This allows users to have measurable and observable interactions that culminate in a positive experience while providing the data necessary in the preliminary stages.
This MVP must then be put on the market and into the hands of the potential customer base. While this may seem counterintuitive in a competitive sense, it’s a vital step in the “measurement” phase of development that allows immediate and relevant feedback to become part of the development cycle of the product. During this phase, user interviews, data gleaned from the product itself, and other methods of data collection should all be utilized, so that the development team can gauge the MVP’s core features and their performance.
The “learn” phase of the loop is the most critical step in this process. This is where the startup integrates information gathered at the measurement phase. At this point, they can truly answer the question, “Can we build a sustainable business model around this product?” Depending on the data and information gathered from users, the team might at this point revise the MVP and continue to send it to market and revise key features based on the performance of the product. Alternatively, if the measurement phase reveals certain features to be unpopular with users or that the target audience is not the right one for the product, the development team has the option to “pivot.” In pivoting, the team either revises the project in a way that better meets audience needs, or they abandon the project altogether and return to the process of determining a revised PoC and MVP that actually meets the audience’s expectations.
The Lean Startup development cycle adds an element of caution into the volatility and risk inherent to startup and entrepreneurial pursuits. Traditional development methods lead startups to seek capital from investors and then risk wasting that investment on a product that might never see a single sale. Maintaining a level of cutting edge innovation, the Lean process allows developers to accelerate the product development cycle, engage customers from the beginning, and create a ready-made audience for the product while only spending investment capital as needed in targeted and precise ways that improve the product.
We know how to keep it Lean
If you’re an entrepreneur or startup with your sight set on breaking into the increasingly saturated and competitive technology market, we here at Kays Harbor Technologies want to make sure you don’t become another statistic.
You need a growth partner who can take development to the next level and be completely agile throughout the iterative process. Kays Harbor Technologies has extensive experience working with startups and entrepreneurs in the creation of successful proofs of concept and supporting clients throughout the development cycle to position their product in the most effective and profitable way. So partner with us if Lean development principles resonate with your business model. We are dedicated to your vision and look forward to partnering in your future success.
Vectors Courtesy: Freepik