Start-ups are based on assumptions, as is any innovation or project. Assumptions are a major source of risk where it is not clear what they are, or where the original assumptions get forgotten and end up being taken as fact.
The philosophy of the Lean Startup has introduced the concept of the MVP or Minimum Viable Product. The MVP is specifically intended to test the assumptions in a startup, innovation or project at a very early point. So, you use a series of MVPs to work out if your assumptions are right; and if they aren’t, you change tack before you have racked up too much cost. It isn’t just Version 1 of the product that you then add functionality to; it is something you try out and then change radically if the assumptions are shown to be wrong.
As Eric Ries explains in his book The Lean Startup, if you are a media startup wanting to sell advertising, your assumptions will probably include that your idea can capture the attention of a defined customer segment, and that you can sell that attention to advertisers. The riskier assumption is probably that you can capture the attention of a defined customer segment in the first place, so your initial MVP should test this premise. If it doesn’t then you pivot to another strategy.
One area where you might have expected some innovation and a series of tests of MVPs is in retail in the UK. 2019 was a terrible year for retail job losses; taxes and property rates continue to favour online shopping to bricks and mortar; and now the pandemic has challenged the very idea of the city centre and the shopping mall.
Change brings risk. Failing to change brings additional risk. Surely now is the time to roll out the MVPs…
Data Source: The Lean Startup – Eric Ries, The Economist, The Observer newspaper.