This is the fourth lesson in the series: How Non-Technical Founders Can Bring a Product to Market.
By Poornima Vijayashanker
Welcome back! In my previous lesson I mentioned that both technical and non-technical founders should start with a Concierge MVP rather than jumping into building a product. The reason I encourage this step is because it forces founders to identify the key pain points that customers are experiencing, and figure out ways of resolving them. The resolution of the pains are the benefits that customers want to buy. Hence, it doesn’t matter what specific features you’re building, the focus should be on the benefits. The benefits are after all the value proposition that customers are buying into.
Now you might still be skeptical. So in this lesson I want to showcase a few successful companies that began as a Concierge MVP. You might even be shocked to know that one of these has become a billion dollar company!
Case Study 1: Zappos
The founder of Zappos, Nick, loved shoes, and had a theory that other people probably loved shoes just as much as he did. He also had a theory that people might be open to buying shoes online. But he wasn’t a 100% sure. So the first thing he did was walk into a shoe store in San Francisco. He asked the shoe store owner about current inventory. Then he struck up a deal saying that every time someone bought a shoe on his website, he’d come over and purchase the shoe from the store owner. The store owner agreed to the deal. Nick went home and setup a pretty simple site listing the inventory that was in the shoe store.
Guess what happened next? Nick sold his first pair of shoes, then his second, and so one.
By pursuing a Concierge MVP Nick validated his theory that people will buy shoes online. The value proposition was clear to early adopters: it was convenient to search through an inventory of shoes and purchase online.
Only after Nick had validated his business model through his Concierge MVP did he approach Tony Hsieh for funds.
Case Study 2: AirBnB
Many people have experienced the rise of AirBnB prevalence, and how easy it is to find and book a rental online. However, before AirBnB became what it is today, it started off as a simple side project for the 3 founders, and is probably one of the most classic examples of a Concierge MVP.
Days before the Democratic National Convention the 3 founders knew that people wouldn’t be able to find a place to stay. So they piled up air beds (hence AirBnB) into their small apartment, and put up a simple ad about renting an air bed. Guess what? People actually rented an air bed!
Once again the value proposition was clear, people who wanted to go to this highly sold out event couldn’t find a place to stay in traditional places such as hotels and B&Bs. So the 3 AirBnB founders were able to offer them a place, and their early adopter were willing to pay and sleep on an air beds!
In both of these cases, Zappos and AirBnB eventually had to do a lot to scale their business to become million dollar and billion dollar revenue generators. But by starting with a Concierge MVP they were able to test out their first hypothesis without making a huge investment in terms of time and resources being spent building a full product. They were able to prove that people would buy the experience.
Even in the case of my own startup Femgineer, my Concierge MVP was a single page ad on my blog about an 8-week online course on product development. I didn’t bother creating actual curriculum for the full 8-weeks until I had a set of students who had pre-paid for the course! This pre-sales tactic took a lot of the risk out for me spending my time developing curriculum, and it also made it clear what value proposition students were willing to pay for: an online course with me on product development!
OK so hopefully by this point you are starting to see the value in creating a Concierge MVP. But you’re probably wondering how to get started? In the next lecture, I will walk you through the getting started phase!
Did you enjoy this lesson? Got any questions for me on it? Please let it the comments below and I’ll be happy to answer it!
Checkout out the previous lessons:
- Lesson 1: Why do so many minimum viable products fail?
- Lesson 2: What is a concierge MVP?
- Lesson 3: Why should both technical and non-technical founders start with a concierge MVP?
