Good ideas power the world. But a good idea isn't enough to create change in the world. To create something new, something world-changing, a new idea has to take a form that fits the needs of enough people. Ideally, at least in a business, enough people who want to pay for it!
People talk a lot about “business models” and “value propositions” these days. No-one understand what that means better than Dr Yves Pigneur.
So… Who is Yves Pigneur?
Founded in 2009, Wealthfront is a lean startup that lets regular investors have access to highly skilled investment managers. The company currently manages over 200 million US dollars in investments. Additionally, the business successfully meets all the complex regulations required to operate in this domain.
Co-founded in 2004 by Eric Ries (the author of The Lean Startup and creator of the concept), IMVU was one of the first successful lean startups. It is a large virtual 3D chat environment where you can dress up an avatar, create a home page for it, and talk with new people online. The original product the company made did not contain these features, however. The product evolved through the lean startup process to become what it is today.
Minimum Viable Product is a term that is often used in business and marketing but it is not usually clearly defined because it's not that easy to "get". When you understand how powerful the idea is, you'll understand why minimum viable product matters.
Myth says that between 80 to 90 percent of products fail. That provides a scary outlook for the lean startup. The actual cross-industry failure rate ranges between 30 to 49 percent, according to SpeckyBoy Design Magazine
That still means that after all the hard work a startup puts into its minimum viable product (MVP), one-third to a half will fail. When it is your product that fails, what do you do to successfully pivot and get back on track?
Product-market fit means that the product is well suited to its target market. In other words, there are a lot of real users interested in pay actual money for the product. A startup needs to do rigorous testing during development to achieve this fit. Here are some necessary aspects of product-market fit for a lean startup to consider.