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Minimum viable product (MVP)

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What is a minimum viable product?

A Minimum Viable Product (MVP) is an early version of a product with just enough features to satisfy early adopters and gather actionable feedback. The primary purpose of building an MVP is to test core assumptions, validate demand, and accelerate learning—all while minimising time, effort, and resources before committing to full-scale development.

Key takeaways

1
Focused development
An MVP strips a product down to its essential features, allowing teams to test hypotheses or market demand with the smallest possible investment.
2
Rapid feedback loop
With a functioning MVP, real users interact with the core solution, providing direct feedback for improvement.
3
Risk reduction
By validating the product idea early, businesses can avoid costly missteps and allocate resources more effectively.

4
Continuous learning

MVPs enable iterative cycles of development—features and solutions are refined or changed based on real-world insights, not assumptions.

Why does a minimum viable product matter?

An MVP helps entrepreneurs and teams avoid building unnecessary features or products that customers don’t want. By focusing on what’s truly essential, teams learn whether their idea solves a real problem before making significant commitments. This approach enhances the likelihood of achieving product-market fit and lays a foundation for future growth.

How the MVP process works

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1
Identify the core problem

Define the essential customer need or problem you want to solve.

2
Develop the MVP

Build the simplest version of your product that addresses the core problem, leaving out non-essential features.

3
Engage real users

Release the MVP to a selected group of early adopters or target customers.

4
Gather data and feedback

Collect quantitative and qualitative input on how the MVP performs, what works, and what’s missing.

5
Iterate quickly

Use what you learn to improve the product—either refining features, adding what’s needed, or pivoting if the idea isn’t resonating.

Impact on business strategy

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The MVP approach encourages organizations to maximize their learning while minimizing resource waste. By continuously testing and iterating on a basic product version, companies adapt more effectively to customer needs and real-world conditions. Teams work nimbly, making fact-based decisions and reducing the risk of building the wrong product.

Impact on financial statements

Real-world example

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Imagine a team has an idea for a mobile fitness app. Instead of developing every planned feature, they launch an MVP with only basic workout tracking and user progress history. Early users try the app, and the team measures which features are used most and gathers feedback on what users really want next. Based on this, the team can prioritize valuable features, ensuring future development matches customer demand.

Frequently asked questions about minimum viable product?

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A prototype demonstrates how a product might work, often for internal stakeholders. An MVP is a working product tested by real users to validate core assumptions.
As soon as you have a hypothesis about a market need or solution and want to test its real-world viability without committing to full-scale development.
Low traction is a valuable signal. Gather feedback, identify gaps or misunderstandings, and either pivot your approach or refine features before further investment.