The Lean Startup includes a great case study of a startup that used what Eric Ries refers to as the ‘concierge MVP’. The company envisioned a grocery delivery web and mobile application that would suggest particular groceries based on recipes, feature sale items, and allow the customer to order through this app.
Rather than invest their time and money into building even a primitive version of the web app, the team went to grocery stores, approached potential customers in person, and started to offer them the services that they envisioned the web app would eventually do. When they found someone to accept their services (for free to start), they continued providing value to the customer. Eventually, they asked the customer to pay for the service, and the customer did. The act of the customer actually paying for the service was a crucial validation of their hypothesis about the usefulness of their web app.
The concierge version of a minimum viable product requires manually taking care of initial customers with the attention that a personal concierge would provide at an upscale hotel. While the vision for your product or service probably includes more automation, this personal approach allows you to experiment and learn about the validity of your hypotheses without investing time and money in development.
Looking back on the founding of my previous startup, Bungolow, my cofounder and I definitely could have used this technique before we invested serious money and three crucial months on development of our website. The bulk of the three months of web development was spent on the calendar / booking / payment processing system on the website, which allowed a customer to select an available hotel room date from a calendar and book the room using their credit card.
While the calendar booking system was always part of the long-term vision of the site, we could have launched an MVP without the complex (and costly) system in place yet. We could have spent two days – rather than three months – putting up a simple website with a phone number and a line of text: “If you are interested in our current hotel deal, simply call us, and we will personally walk you through payment and any questions you may have about the sale.”
We would have learned a ton of information about our customers and whether our product solved a problem for them. Three months and serious money later, the complex booking system was live, but it didn’t put us in a position to learn more than a concierge MVP would have.