For years now, minimum viable products (MVP) have enabled teams to launch, iterate and validate new products and services with stellar results. A core step in the lean startup methodology, MVPs enable you to leverage vital customer insights and make crucial iterations based on an early version of a new product.
Many of today’s biggest startups began as humble MVPs, gradually becoming the household names they are today (and disrupting entire industries in the process). Here are just a few inspiring examples:
- Dropbox, which got its start with an MVP demo video.
- Airbnb which started off with a few air mattresses in its founder’s living room.
- Uber which started with a software prototype and a few paid cars.
Aside from facilitating early validation, MVPs enable companies to launch faster, reduce risk and save valuable resources that might have otherwise gone into an offering with no market value. With benefits like these, it’s not surprising that a growing number of corporations have adopted the practice to create their own products and services.
While both corporates and startups use MVPs to fuel product development with real customer data, each has adapted the process to fit the unique needs of its own environment. To give you a better idea of the contrast between MVPs and corporate MVPs, we’ve listed some of the key differences below.
Corporate bureaucracy vs startup flexibility
Corporates and startups operate in very different ways. Startups are small and nimble, enabling them to move quickly through the MVP process and launch innovative products and services quicker than their corporate counterparts.
Large corporations, on the other hand, tend to have long chains of command, making it challenging to get new ideas approved and developed at the same speed. Even in-house innovation labs and business units, which operate with relative autonomy compared to the rest of the company, need support from:
- Venture boards
- C-suite executives
- Corporate stakeholders
Support from these profiles will help ensure you get the resources you need for your corporate MVP (and beyond), so make sure to factor it into your plans.
Speed and focus
For startups, a successful MVP phase is a sole focus and a race against time during the first few months. Small teams of entrepreneurs work tirelessly during this time to:
- Understand their target audience and their pain points
- Map out their customer journey and business model
- List the assumptions to be validated (e.g. desirability, viability, feasibility, responsibility)
- Design and build an MVP to test their assumptions (e.g. MVP type, features, experiments, etc.)
This phase is a “make or break” for many startups that might not have the time, resources or funding to do big launches or extended research and testing. In such cases, they need a successful MVP to attract investors and start creating revenue - the lifeblood of any business. The process has to be lean and quick, making the most of the often scarce resources available.
While corporate startup teams face many of the same challenges, the life of the entire business doesn’t hinge on those first MVP iterations. Corporate startup teams have a bit more room for planning, design and validation. In many cases, they might be involved in multiple projects, with a broader innovation focus rather than focusing on a single MVP.
The power of corporate assets
Most young startups operate with skeleton teams, limited budgets and steep timelines, putting them under enormous pressure to move from milestone to milestone quickly and with few resources.
In contrast, corporate startup teams have a myriad of assets to fall back on, including:
- Access to funding
- Networks and partnerships
- Equipment and infrastructure
- Industry know-how and talent (Just to name a few)
These assets and resources can be leveraged to fuel the development process, giving corporate MVPs a competitive edge over their startup counterparts.
The validation process
For startups the MVP validation process is pretty straightforward: Map out the assumptions and find the leanest way to test them. With the right messaging and experiments, they can usually access the data they need to take the next step (e.g. build, pivot or kill).
While the basic process is the same for corporates, there are a few significant differences. On the plus side, corporations tend to have a body of learnings, industry expertise and a built-in audience with which to test new ideas and concepts. Many have dedicated innovation units with teams that are experienced and adept at validation, making their experiments more focused, refined and effective.
However, it’s not all smooth sailing for corporates. When testing new value propositions, corporate startup teams have to be mindful of how it might affect the overall brand, avoiding any possible backlash or negative reaction from customers.
Final thoughts
Whether you’re in a startup or corporate environment, the ultimate goal of an MVP remains the same: to establish a strong product/market fit. In both scenarios, it’s an ongoing process of continuous build-measure-learn loops that will enable you to improve your offering in preparation for scale. In other words, the journey may differ, but not the destination.
While the main principles remain the same, the differences described above will enable you to anticipate the challenges and opportunities present in each environment, increasing your chances of success.
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Looking to design, build or launch a corporate MVP? We can help you build a customised strategy that leverages cutting-edge growth marketing and customer acquisition techniques to validate your product/market fit with real customers.
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