It’s easy to get ahead of yourself and build too much product before real users get their hands on it.
Some industry experts go and build the “complete solution” before talking to potential customers.
Most startup newbies set out to deliver a “perfect app” before they get users.
It’s hard to resist over-building and over-perfecting when you start.
This is the MVP problem. What’s really Minimum and Viable in your initial Product?
How much do you build before actually selling something to a customer?
First-time founder Daniel Yuabov quit his job in 2015 to start Carvoy. He spent his life savings to build their first product.
Carvoy allowed consumers to choose a new car online and then buy it from a dealer. Their first app was interesting to consumers but resisted by car dealers.
Their second solution had them manually arranging thousands of new car purchases behind the scenes for their growing crowd of online buyers.
It wasn’t until they started automating every step in the car buying process that they started to sell thousands of cars. Choosing a car, getting a confirmed best price, arranging pre-approved lending, and handling delivery.
On the Practical Founders Podcast this week, Daniel described his most expensive startup lesson:
“I learned the hard way not to build a big first product that takes a year to build. Be very, very lean with what you’re building at first.
“There’s the 80/20 rule that 80% of your users will use 20% of your features. Find that 20% and build that before doing everything else.
“You should try to get an actual commitment from a user, a handful of users, and even actually have them pay you a dollar, whatever it is. You should probably build last.”
I hear this in almost EVERY Practical Founders Podcast interview with founders who have survived this phase and built something big:
SELL FIRST AND BUILD LATER.
Daniel grew Carvoy for 5 years—without VC funding—and sold it to a giant Fortune 500 company in 2020.
Listen to Daniel’s amazing startup-to-acquisition journey of Carvoy on the Practical Founders Podcast.
#practicalfounders
