I see a lot of first time (and even repeat founders) allocating way too much resource into getting to MVP. I’ve seen an average of 2-4 months for any startup to feel comfortable saying that they have an MVP out and being tested in the live market. Personally, I think that’s way too f*cking long. In today’s day of consumers readiness to indicate their ability and willingness to “invest” (purchase or spend a lot of time using the “solution”), this shouldn’t take more than 7 days.
If I was to start a new company today, I would identify the most core and important thesis for my startup. This thesis means the one thing that needs to be true in order for my startup to be viable. Then I would find the easiest way (the most hacked up way), to prove or disprove my thesis as quickly as possible (with the intention on quick as possible).
As a concrete example, before I decided to do the Kimchi fund, I was experimenting with a “Uber for haircuts” with the intention of taking that to be “Uber for indoors” while Uber itself was “Uber of X” for everything outside the front door (takes a different level of trust and angle for consumers to have a level of trust for service providers to do something outdoors – like taxi – vs indoors – like maid service when you’re not there).
Before I wrote a single line of code, I was able to test the idea and validate the thesis that there is a business to be made in servicing “professionals with good disposable income where a $50 haircut that was because of convenience of their schedule and location was more valuable than the ‘affordability’ of a $15 haircut at Supercuts you have to transport to get to”. I was able to validate the idea just using a simple Google Form Sheet. Tweeting to folks that searched “Uber for Haircuts” and just doing a general FB ad for folks that fit my profile, within 30 days, I had 100+ people who paid $50 to get a haircut at their office or home.
I didn’t end up pursuing the “Uber for Haircuts” because it is against California’s regulations – due to CA’s Board of Cosmetology (Fun Fact: Did you know it takes almost 2x longer of training to become a licensed hair stylist as it takes to be a cop – with a license to wield a weapon and fire it – in California?). It wasn’t something I was all that passionate about doing (but I still get in office haircuts every 3 weeks). (Btw, it’s legal in 13 states, including NYC. If you are a founder working on this, contact me!)
Anyways, the lesson here is that as a founder, you always want your MVP to be something that’s so clear in your mind and you want your first product to be absolutely perfect. You don’t want to feel embarrassed. You want to feel proud when you launch it. However, most of the time, your vision – until tested and reshaped by the market – is not something that’s brilliant enough for a venture-backable sized market to want and pursue. And often times, your first “crack” at the market with your solution is not something that’s really fitting. So before you raise outside capital and spend unnecessary time in writing code to accomplish the same effect, use the myriad of tools available today to get a sense of the market pull and use that data to help shape and reshape your vision of the ultimate solution you want to build out for your startup.
Some examples within 500’s Portfolio:
– Plugger testing their thesis of “people with dead or close-to-dead batteries are desperate enough to pay $5 to swap their battery for a fully charged used battery”. They tested this on the streets of Gangnam Street (home of PSY) and did 5,000 exchanges in 6 months in 2013. This year, they are on track to expand to 1,000 stores in Korea and service 1,000,000 customers. It took them a full $500 to test the opportunity of the $4M+ revenue they are expecting to do this year (just 2 years after).
– Sunshine testing their P2P, direct Device-to-device streaming technology for non photo or video files. Their thesis was “there are enough smartphone users who want to access non-media files that are abnormally large (25mb+), but don’t have enough space locally”. Given that they had already proved out there is a demand for media files, they set up a home page where it listed “Photos, Videos” then “Files” as one of the three options on the main menu. If you clicked on “Files” you had to input your email address to get “first access” to the new feature. What ended up happening was that a huge majority of their active users had actually submitted their email addresses to be notified when the feature was available that they ended up rushing the feature ahead of schedule.
Takeaways for First Time Founders:
Whatever vision you have in your head WILL NOT be the final product. TEST TEST TEST. Value your time as much as possible and if using and hacking a combination of existing products today to get 60% of the value add of the core thesis proven, take that route and see what the reception is like. Bonus points: Try to validate that thesis without writing a single line of code.