Eric Ries: Lean Start-up and product MVP

Lesson Details:

I: Introduction

Hi, I am a WordPress developer and I want to make money from my work. So, I decided to start a business building wordpress plugins.

II: Body

Eric Ries defines a startup as “a human institution designed to deliver a new product or service under conditions of extreme uncertainty”. In his book “The Lean Startup” he explains how to create a successful startup by building a minimum viable product (MVP). He suggests that startups launch a product as early as possible, as this will increase their chances of success. Launching the product as early as possible will allow the company to find out what customers really want, giving them an opportunity to work on the product and build a profitable business. The Lean Startup methodology is based on Eric Ries’s “build-measure-learn loop”, also described in his book. In order to test a hypothesis, the loop consists of the following three steps: Develop – Build a minimal version of the product; Measure – gather data; Learn – analyze your data and update your initial hypothesis.

The MVP (minimum viable product) is the least amount of work necessary to bring a product to market and test your fundamental business hypothesis. It allows you to test your assumptions about the problem and the market it addresses, and enables you to collect hard evidence about its size and shape. A Minimum Viable Product is not something you finish and release once. Instead it is a living and breathing entity that you continue to develop and grow. As an entrepreneur, you must be prepared to experiment and iterate. You don’t know what you don’t know. That’s why it’s important to get out into the marketplace as quickly as possible. The first iteration should be as simple as possible, just enough to get an idea of whether customers will pay for it. And the feedback should come from customers, not colleagues or advisors. You want to learn as quickly as possible so you should be able to get your first version out before you run out of cash.

III: Conclusion

If I follow this method and build an MVP first, I will have a better idea of what my customers really want and I can build on this foundation. I might even get customers interested in my idea more quickly than if I were to wait until completing the whole project before launching it!