Intro
Classic startup advice says to get something in front of users as fast as possible, get their feedback, and iterate from there. If you take the opposite approach—spending a long time planning and building before seeing how people respond to something in their hands—you could waste a lot of time. Reactions from actual humans are normally the key metric of success, and those reactions are often surprising. So, most of the time, you want to get those reactions early and often.
For most companies, things only get real when they get things in front of potential customers.
The leading work that set out this idea is The Lean Startup by Eric Ries. Ries’ book sought to take a vague, unpredictable process of startup building and make it more systematic (here’s a talk by Eric).
And it’s Lean Startup that popularized the idea of the “minimum viable product” (MVP):
The version of your product that you can get before users quickly, and it includes whatever is required (and not more) to learn whether your plan for your product is correct.
So the MVP is the version of your product that is not meant to do everything, not meant to have every feature you can think of, and not meant to be beautiful.
YCombinator CEO Michael Seibel gives an outstanding overview of how to approach building an MVP here, where he sets out a lot of great advice, including the following roadmap for pre-launch startups:
- Launch quickly (even if it’s bad)
- Get initial customers
- Talk to customers and get feedback
- Iterate (improve the product)
Here’s a big point to highlight from Michael: “Hold the problem you are solving tightly, hold your customer tightly, hold the solution you are building loosely.”
And here’s the recommended MVP elements:
- Very fast to build (weeks not months)
- Very limited functionality
- Appeal to a small set of users
To make this more concrete, this doc lays out examples of what some successful companies did for their MVPs.
Examples of Successful MVPs
Amazon
Amazon launched July 5, 1994. Jeff Bezos lays out the process of starting the company in this 1997 video. First, he identified the internet as a massive new vehicle for selling products. Then he focused on one product category to start—books—because “there are more items in the book category than there are in any other category by far.”
Note that while Amazon did start by focusing on books, its start wasn’t entirely stripped down. It also built up a fairly large inventory (around one million books) and raised money prior to launch. I’d say there’s two reasons that justified this approach.
First, the problem to solve was straightforward: make book purchasing much more convenient. Jeff Bezos couldn’t guarantee success (he’s said he gave the company a 30% chance of success when he started it), but his research, his own experience as a book purchaser, and the historical importance of buying books meant that he could be more confident in his plan than many startups can be at the start. Second, to make the book purchasing experience much more convenient, he had to offer a meaningful selection, so Amazon’s first version naturally required more resources in order to validate the idea.
Here’s what the first website looked like:
(Source: Amazon.com - 1995 | Web Design Museum)
Zappos
Founder Nick Swinmurn’s first version of the online shoe seller was to go to local stores, take pictures of their shoes, and post them to his website. Users could then purchase a pair, meaning Nick would go back to the store, buy the shoes himself, and send them to the customer. Here’s some history.
Dropbox
Founder Drew Houston started generating excitement for his product before having anything close to ready for users. He created an explainer video of how Dropbox would work (he doesn’t mention in the video that the product’s not ready yet):
Doordash
(This is a good example of doing things that don’t scale too.)
Doordash took a similar approach. When they had the idea for enabling restaurants without delivery services to deliver their food, according to founder Tony Xu (starting at minute 17:00 of his How I Built This interview in 2018), they wanted to start with a test to see:
- whether people wanted delivery,
- how much people would pay for it,
- whether restaurants would work with them, and
- whether people would be willing to be drivers.
So, as Tony relays, they put together a simple website, paloaltodelivery.com, and put pdfs of 8 local restaurants on the site. Then they signed up for a google voice number that would ring each founder’s cell phone, and put the number on the site.
When they’d get the orders from the site, the founders would order the food themselves, pick it up—and pay for it themselves, and then deliver it to the people orders—where they would then get the money from the customer (essentially reimbursing them).
As students, they would offer service when they weren’t in class.
There was no app. It was a “janky” web page. None of it was scalable.
And they kept this up for the five months.
Shopify
Shopify is the dominant platform for building an online store.
It started when founder Tobias Lutke wanted to have an online store for his new snowboard shop in 2004. He was shocked to learn that there was not an off-the-shelf solution for putting together an online store, or something even close. He had expected to spend a week getting the online store ready, and realized that was impossible.
So he decided to build his own custom online store for the snowboard company–and that was the MVP for Shopify, a tool entirely for his own company’s purposes.
As they built the snowboard company, they started getting people coming to them and asking them to build a similar online store for their own store.
After enough people asked, and reflecting on how important the online store was for their own business, they decided to go all in on turning what they had built into software other people could use to build their own store online.
Here’s Tobias talking about it on How I Built This (he talks about the snowboard online store experience at 16:00):
Netflix
When Netflix cofounders Reed Hastings and Marc Randolph had the idea for Netflix–a company that would send DVDs in the mail to start–they had to first verify their most basic hypothesis: that it was feasible to send DVDs in the mail and have them arrive in one piece.
So they got a CD–they didn’t even wait to get their hands on a DVD–and mailed it to a nearby location to make sure it could survive the trip in one piece. It did, and they decided to move onto the next stage of the business.
Here’s some more history about it:
And here’s Hastings retelling the history of Netflix on Masters of Scale: