When I started as an investor, one of the most common mistakes I saw among new founders was their approach to building a Minimum Viable Product (MVP). It’s easy to think of an MVP as a simple, stripped-down version of the final product. But in reality, a great MVP is more than just a prototype—it’s the first test of your idea’s real value to customers.
Through my own experience with early-stage startups, both as an investor and as a former founder, I’ve seen MVPs that succeed and many that fall short. Here’s how to approach crafting an MVP that actually works.
Step 1: Define the Core Problem
Every successful MVP starts with a clear, well-defined problem. Early in my career, I launched a website to connect communities, and I quickly learned that without a concrete problem to solve, users wouldn’t see the value. Your MVP should focus on addressing one critical pain point for your target audience.
Take the case of Notion. Instead of launching as the all-in-one tool it is today, Notion’s MVP focused on providing a single workspace to organize and edit notes—targeting users frustrated by scattered files and information overload. This MVP version quickly caught on, allowing the team to validate the core problem and build around it. When planning your MVP, ask yourself: What is the one problem my product will solve for users?
Step 2: Focus on Viability, Not Perfection
The “V” in MVP stands for “viable,” which means your product must be functional and valuable, even if it’s not feature-rich. I often tell founders that an MVP isn’t just about making something minimal; it’s about creating a product that genuinely works for its intended purpose.
Consider Figma, which launched with a minimal set of design tools in a browser-based platform. While it didn’t yet rival established design software, Figma’s MVP was viable for collaborative design, something the market was lacking. This lean version was enough to prove Figma’s value to designers, laying the foundation for what is now a widely used design tool. Striking the balance between simplicity and functionality will help you validate your concept without wasting time on unnecessary features.
Step 3: Build, Launch, and Iterate Quickly
The primary purpose of an MVP is to test assumptions and gather feedback from real users. Once you have a viable version of your product, launch it and observe how users interact with it. When I invest in startups, I always look for teams that can rapidly iterate based on early feedback. A quick cycle of building, launching, and learning allows you to refine the product before scaling.
Take Clubhouse, for example. Initially, it launched as a very basic, invite-only platform for audio conversations. Early feedback guided Clubhouse’s features, from rooms and hosts to user profiles. By staying flexible and iterating quickly, Clubhouse was able to grow rapidly and capture the audio-social niche before competitors entered the market.
Step 4: Engage with Early Users
As a founder, building relationships with your earliest users is crucial. They’re the ones who will help you understand what’s working and what isn’t. When I launched my community website, my best insights came directly from users who were passionate about the idea. I’ve since encouraged many founders to foster this kind of relationship with early adopters—they provide invaluable feedback and are often the most loyal supporters of a new product.
When engaging early users, be transparent about your product’s development. This relationship often generates the kind of word-of-mouth that money can’t buy. An excellent example of this is the team at Buffer, who openly shared updates and roadmaps with their users, creating a loyal community and gathering valuable insights to improve their product.
Step 5: Measure Success with Key Metrics
One of the most important parts of an MVP is establishing clear metrics to measure its effectiveness. As an investor, I look for startups that track their progress from day one. Whether it’s user retention, engagement, or customer acquisition, defining these metrics early on will help you evaluate the MVP’s performance.
Take Calendly, the scheduling tool. From the beginning, Calendly tracked metrics like user adoption and booking completion rates to understand engagement. By focusing on these key performance indicators, they could refine the experience, making it intuitive and valuable for users. This focus on metrics helped them stand out in a crowded market, paving the way for growth.
Final Thoughts: A Purpose-Driven Approach
Crafting an MVP that works is about creating something meaningful, not minimal. By focusing on solving a core problem, ensuring viability, iterating based on real feedback, engaging with early users, and tracking key metrics, you can launch with purpose and set your startup on the path to growth.
Your MVP isn’t just a prototype; it’s your product’s first proof of value. For new founders, remembering this distinction can make all the difference in your startup’s early success. With a purpose-driven MVP, you’re not only building a product—you’re setting the foundation for a solution that truly matters.