Quibi was a short-lived short-form video app. It was founded in August 2018, launched in April 2020, and folded in December 2020, wiping out $1.75 billion of investor’s money. That’s twenty months from founding to launch and just six months to fail. Ouch.
Forbes chalked this up to “a misread of consumer interests”; though the content was pretty good, Quibi only worked as a phone app while customers wanted TV streaming, and it lacked social sharing features that may have drawn in new viewers. It was also a paid service competing with free options like YouTube and TikTok. According to The Wall Street Journal, the company’s attempts to address the issues were too late: “spending on advertising left little financial wiggle room when the company was struggling”.
If only there was some way Quibi could have validated its concept prior to wasting nearly two billion dollars1.
‘Geez, why didn’t they just try it out first with a basic version and see if people liked it?’, I hear you say. Such a genius idea! As it turns out, there’s already a name for it: Minimum Viable Product (MVP).
MVP: What and why
Product, as in the good or service that you’re developing.
Viable, as in it has to be usable and valuable to actual customers in the real world.
And Minimum, as in just the features required for viability so that you can get there quickly and cheaply.
The concept is simple: create a version of your solution that’s just good enough and put it out in the real world to validate assumptions about the product and market. That way, if your assumptions are wrong, you can pivot or shut it down without having spent too many resources on a failed idea. If your assumptions are right, you’ll have some great feedback to propel you along and help populate your product roadmap.
Take, for example, the recent Saint Javelin line of products supporting Ukraine. Christian Borys just wanted to do something fun: take a funny pro-Ukraine meme and make a few stickers to share. The image got such great feedback on Instagram that he decided to post it for sale on Shopify with the goal of raising CA$500 (~US$385) for a charity that helps orphaned children of Ukrainian soldiers. You can guess what happened next: the orders blew up and Saint Javelin has expanded to a full line of products sporting a variety of pro-Ukraine memes.
That feels a little like a silly example; tons of successful companies started from one person’s hobby or playfulness that never intend to grow into something bigger. And yet, it’s the perfect illustration of how starting small can lead to success. The problem with high-profile failures like Quibi is not that they started with big ambitions, it’s that they were so convinced that their offering would be celebrated by the market that they didn’t bother to test their assumptions first.
An MVP is not a cheaper product, it’s about smart learning.Steve Blank
An MVP is not a demo, proof of concept, or beta
An MVP is a very specific step that’s valuable in the startup stage of an idea.
It’s not a beta version. A beta is a pre-release version of software with all of the functionality you plan to deliver; it’s functionally complete, but it probably has some bugs to work out before it’s ready for the public. It’ll tell you if your idea has legs, but way too late; an MVP should have been done much earlier to prove the value of the idea before the major development effort.
It’s not a demo. A demo may look cool, and may convince investors, but it doesn’t actually tell you anything about a product’s likelihood of market adoption. Maybe the demo is a simple video of your concept, or maybe it’s based on your MVP and real-world data. But don’t confuse the two.
It’s not a proof of concept. A proof of concept is an internal engineering prototype to prove that the technology works. It’s essential if you’re doing something brand new to make sure it’s actually technically feasible. But it doesn’t tell you if there’s a need for the product; ideally you’d do an MVP first, to prove the need before you spend money on technology development.
And that’s a key point: the MVP has to actually address a customer’s needs, but it doesn’t actually have to be technologically complete! It can be entirely manual behind the scenes as long as the customer is able to experience the value of the service. Steve Blank offers a great example of a startup that planned to use drones to capture data from agricultural fields to help farmers make smarter decisions. The MVP didn’t require any actual drones or AI data processing, the team could gather data from a piloted aircraft and manually process it. Once it’s clear that the service is useful, then the expensive/hard part of developing the hardware, software, and infrastructure can commence.
In the startup stage, the MVP helps with specific question: “we have this idea, how can we validate it before we invest too much in it?”
“Would consumers be interested in a short-form video service?”
“Let’s spend $250k to create a webapp and serialize some existing content!”
Founders become infatuated with a bold and ambitious mission—as they should. However, what separates a startup that actually brings its mission to life from one that doesn’t is the ability to shed the rose-colored glasses and solve for a small job to be done.Shawn Carolan
The government needs MVPs
As this blog is focused on government system development, we have to devote at least a bit of space to describe how the MVP concept relates to government. And the honest answer is, I don’t see anything different. Government program offices should develop MVPs to test out ideas prior to major system acquisition efforts. Government offices have a number of vehicles at their disposal to fund such efforts, such as existing Systems Engineering and Technical Assistance (SETA) contracts, the Small Business Innovation Research (SBIR) program, and small-value Other Transaction Authority (OTA) contracts. They also have a number of research labs with simulation and prototyping capabilities as well as large military exercise events, great opportunities to validate an MVP.
Larger programs executing using Agile development approaches may create MVPs for particular features or capabilities being considered. “Successful” experiments build the product roadmap while “unsuccessful” experiments provide valuable lessons learned for relatively little cost. Far more beneficial than minimizing failure, the ability to experiment enables sensible risk-taking on “extreme” ideas that never would’ve been considered otherwise.
Another bite of the Apple
Apple provides a great case study in the importance of MVPs, with an example I borrow from the book The Innovator’s Dilemma by Clayton Christensen.
Steve Jobs and Steve Wozniak built the Apple I on a shoestring budget, and on credit at that. They sold just 200 units in 1976 before pulling it from the market and refocusing on the Apple II. The initial product had limited functionality, but it proved there was a market. “Both Apple and its customers learned a lot about how desktop personal computers might be used,” wrote Christensen. The next year, Apple introduced the Apple II, which sold 43,000 units in its first two years.
The Apple I was an MVP for Apple as a consumer computer company.
Contrast this with the Apple Newton, a personal digital assistant (PDA)2 first released in 1993. Newton was the result of over $100 million in research, development, and marketing; the product was shaped by market research such as focus groups and surveys and sported unprecedented portable capabilities. And, yet, it was a flop. It was pricey, buggy, and technically lacking. CEO John Sculley had staked his reputation on it, disappointing investors, and Steve Jobs axed it when he returned to the company in 1997.
Apple had poured so many resources into the Newton that they couldn’t afford for it to fail, and yet consumers hated it. And it wasn’t for a lack of market. The PalmPilot launched in 1996 and was a great success, and of course we have many options for similar devices today. Apple’s Newton served as a sort of MVP for Palm, helping to flesh out consumer and market demands.
Do you have any good or bad examples of MVPs, especially in government and military systems? When are MVPs most important? Least important? Share your thoughts in the comments below.
- Most of the investment came from giant media companies, so don’t feel too bad for the investors.
- Though closer to what we would think of today as a tablet, according to the Motley Fool