Entering the market with a new product is not easy. However, it's still worth attempting regardless of challenging market conditions. This guide can help you navigate this process more easily.
Today's most successful unicorn startups like Uber, Airbnb and Slack have been founded during the economic downturn – why shouldn't yours? Regardless of the common expectations from the angel and VC funding in the COVID-19 crisis, experienced product creators say that the recession is not the reason to give up your startup launch. In this article, I share practices to release a successful product amid the coronavirus recession.
This article will help you navigate these points:
Why it is worth starting with an MVP
How to develop an MVP that is ready to meet investors
How to deliver a pitch deck that investors can't turn down
What to expect in angel and VC investing during the COVID-19 recession
Why start with minimum viable product (MVP) development?
The MVP usually presents as a minimum number of functions as possible. If you feel confident when showing your MVP to the end user, you have likely overworked it. In common, a great MVP lacks some features, screens or design, because the startup usually doesn't have enough time and costs to develop them. And it's normal, because the MVP's primary mission is only to demonstrate the core idea. It's how an MVP differs from the product.
I also suggest the following key reasons to kickstart your startup journey with an MVP:
MVP: the budget-friendly opportunity to validate your idea.
Your idea must make sense for your customers, not only for you and your team. Many startups forget this fundamental, losing lots of money and time when the product idea appears nonviable in the market. What works for you might not work for others. You should keep your customers in mind at all development stages.
One of the primary benefits of an MVP for startups is that it shows you whether the product will be able to address user needs and generate revenue with the minimum costs and risks. You can test your product idea in the market, see the real target audience's response and decide whether it's worth investing in further development.
Save time and money by quitting the non-viable idea.
Sometimes, the best decision is to quit something at the right time to avoid more severe risks and losses. Quitting doesn't mean weakness, it's sooner the wise step that's often difficult to take. The MVP lets you make an early decision about rethinking the product idea or switching to an entirely new one. It helps you save two resources that are the most important for startups: time and money.
Do the fieldwork to define real customer needs.
You might have thought you knew your target audience before you launched an MVP. The feature, which seemed to be meaningful earlier, appeared to be unnecessary after the first interaction with the customer. An MVP is the faster and cost-efficient way to research real customer demands, pain-points, and preferences. Understanding your customers is key to the product's success. It allows you to optimize the product functionality and choose the right marketing strategy.
Develop the product upon the real user feedback.
Consider end users as your product-creation partners. They can give valuable feedback about your MVP and the right direction for the entire product development process. The MVP helps you avoid wasting costs on building a full-fledged product with features that your audience doesn't need in reality. Its primary benefit is the ability to develop features gradually and iteratively based on user feedback.
Build early relationships with customers.
An MVP is not a product but a process. It's the dialogue between the product creator and users, leading to countless iterations and improvements. An MVP lets startups meet their customers in-person and start building early relationships with them. Later, these people will be looking forward to seeing your product's next versions and trying them out.
How to build a powerful MVP that attracts funding
Run an MVP scoping workshop.
Before you start building an MVP, you need to create a scope of all MVP's requirements based on market research, business analysis and end-user investigation. Here are three things you should be aware of from the very beginning of MVP development:
Whom you target: To answer it, you should conduct target audience research and create a customer profile.
What problems your target audience faces. Write an outline of potential customer needs and pain points.
How your product can solve problems. Define your product's mission and the key solution suggested to customers.
How you can measure your product's success. Define KPIs that should ensure the product-market fit.
Define core functionality.
At this step, you need to define core features for your MVP and give up all nonessentials. Reaching a consensus regarding it might be challenging when it comes to teamwork. Everyone in the team will have their own vision of what's essential for the MVP and what's not.
When defining the product's core functionality, you should ruthlessly cut everything that seems nonessential.
Consider your product is something similar to SoundCloud. In this case, your MVP should only function around the primary KPIs (for example, the number of registrations) and shouldn't include additional features, like payments, social sharing, a complicated UI design, etc. Your MVP's landing page also has to be simple, give a quick understanding of how your product solves the problem, and visitors should be able to start using it easily.
Last, work on design and implementation.
When you have already defined a set of requirements for the MVP in general and for each feature specifically, you can move on to designing and coding. This stage includes user experience design, building a simple interface architecture, prototyping, creating wireframes, testing and implementing everything in code.
Startup checklist: 11 steps to create a compelling investment pitch deck
Backed by many years in product development, startup ownership, and communication with investors, I suggest 11 tips to create a pitch deck. These steps will help you prepare a product presentation for investors:
Write an engaging product description.
Consider the problem that your product solves.
Present your solution to a customer problem.
Provide the results of target market research.
Describe how your startup will generate revenue (the subject of investors' biggest interest).
Create a competition map and mention your product's advantages.
Build a customer persona to show investors that you know whom you target.
Showcase the roadmap to add more credibility to your startup idea.
Describe consumer acquisition practices that suit your product best.
Introduce people involved in the project.
Discuss your financials.
Investment trends that emerged from the COVID-19
COVID-19 is just one of the factors impacting the market. It emphasizes the significance of mobility and online presence in the modern world. The coronavirus situation eradicates everything unable to adopt mobility or switch into online, creating a favorable market environment for online businesses.
Consequently, investors are now more likely to fund startups that offer solutions for the current market demands affected by the coronavirus. We have witnessed the growing popularity of e-meeting services, online collaboration software, employee motivation tools, streaming platforms, productivity apps, delivery services, mobile kitchens and so on.
Enter the market with a successful MVP
Entering the market with a new product might not be easy. However, it's still worth attempting regardless of the recession and challenging market conditions. Hopefully, this MVP development guide will help you navigate this process more easily.