The Value Proposition Canvas (VPC) is a powerful tool that helps you in your quest to reach the first 2 of your core 'fits': Problem-Solution fit, and Product-Market fit.

The fact that it gets much less press than its more famous cousins, Lean Canvas, and Business Model Canvas, is a shame.

When harnessed correctly, VPC iterations will help you hone in on the key issues that make a prospective customer tick.

Getting deep under the hood.

To the root core of human-centric needs.

So how do we utilise VPC?

Start off by determining the customer segment you're targeting, and the main personas in that segment.

Sometimes we get a minor 'conflict' at this stage between Lean Startup and Design-Thinking enthusiasts. Why start with markets before use-cases?

As with everything, each case may differ. But determining broad high-level market trends and sizing at the outset helps to avoid drilling into use-cases that may not be commercially viable, even though they tick all the usability boxes.

So after segmenting your markets and the customers that represent it, you can begin to dissect the key personas that would represent end-users, and purchasing decision makers.

Sometimes, these personas may end up being the same person, or end up being represented by multiple persons that make up a decision-making unit.

The devil is in the details. So refinement is key, as you find out more through conversations and testing to help identify key stakeholders in the usage and purchasing process.

And with that, you can begin to build up your VPC by jotting down the pains faced, jobs to be done, and delights being sought, for each of your highlighted personas.

By knowing what your personas intimately want and need, you're in a much better position of matching those needs with the proposed build of your solution.

So do not skimp out on this exercise! I repeat, do not take it lightly!

Sure a Lean Canvas exercise is good for eliciting Problem-Solution fit on the surface, but VPC can take you into the depths. 

The refinement and iterative process of VPC continues as you seek to debunk key assumptions and white hot risks that may make or break the business.

Understanding your personas, and being accurate in that understanding, is absolutely key here.

And with that, we go to the next step of Customer Journey Mapping.
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​​𝐈𝐟 𝐲𝐨𝐮'𝐯𝐞 𝐞𝐧𝐣𝐨𝐲𝐞𝐝 𝐭𝐡𝐢𝐬 𝐩𝐢𝐞𝐜𝐞 𝐨𝐟 𝐜𝐨𝐧𝐭𝐞𝐧𝐭, 𝐥𝐞𝐚𝐯𝐞 𝐮𝐬 𝐚 𝐜𝐨𝐦𝐦𝐞𝐧𝐭, 𝐬𝐡𝐚𝐫𝐞 𝐭𝐡𝐢𝐬 𝐩𝐢𝐞𝐜𝐞, 𝐨𝐫 𝐬𝐮𝐛𝐬𝐜𝐫𝐢𝐛𝐞 𝐭𝐨 𝐨𝐮𝐫 𝐑𝐒𝐒 𝐟𝐞𝐞𝐝!

​𝐏𝐥𝐞𝐚𝐬𝐞 𝐠𝐢𝐯𝐞 𝐮𝐬 𝐚 𝐟𝐨𝐥𝐥𝐨𝐰 𝐨𝐧 𝐬𝐨𝐜𝐢𝐚𝐥 𝐦𝐞𝐝𝐢𝐚 @ 𝐄𝐄 𝐃𝐢𝐠𝐢𝐭𝐚𝐥 𝐂𝐚𝐩𝐢𝐭𝐚𝐥

Since the release of the Lean Canvas, startups have waxed lyrical about its supposed superiority to the Business Model Canvas (BMC), and how it was more 'fit for purpose'.

And I don't disagree with large parts of this argument.

The ability to have Problem-Solution in your primary canvas, is a very powerful tool in binding and matching up with the first 2 of your core 'fits' that a new technology company has to meet, before becoming a thriving, profitable business (check out @EE Digital Capital's previous posts for a refresh!).

But we also need to ask ourselves what we're giving up on the BMC.

For example, Key Partners, Activities, and Resources are important components in the later stage searches for profitability. Otherwise known as the 3rd and final core 'fit': Business-Model fit.

Depending on where your company plays at, there could be some key assumptions and white hot risks that lie under those components that would need validating before its bottom-line can thrive.

A simple remedy would be to bring the BMC back into the fold once you've reached Product-Market fit.

Another favourite of ours is to actually start off with the separate Value Proposition Canvas, which really helps shine a spotlight on the core human-centric needs of your customer. 

It actually helps take your Problem-Solution and Unique Value Proposition exercise on your Lean Canvas, to the next level.

Stay tuned to our next post on why the Value Proposition Canvas is such a powerful tool that helps unify the various frameworks of Design-Thinking, Lean Startup, Jobs to be done, and Problem Statements etc. into one simple but significant exercise.
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We've heard from companies scaling up to meet customer demand, about the flaws and set-backs of producing a Minimal Viable Product (MVP).


Mainly, that the MVP was never fit for purpose. It seems unable to stand the stresses of onboarding more, doing more, or simply biting off more than it can chew.


But that's precisely it.


An MVP was only ever meant to meet the 'minimum' paying criteria of your customers to get the ball rolling.


Moving onward to an actual product release takes a lot more planning, and may even require starting another build from scratch.


Building upon your MVP without incorporating for future design and functionality, will have you building upon flimsy fundamentals that could bite you down the road, in the form of technical debt.


But you had to build and ship your MVP to customers because "time was of the essence"! 


And we totally get that.


If we had to pick however, we'd choose to build and ship the MVP with some reasonable forecasting, but prioritising your customer segment's immediate needs.


And then come back to the drawing board when the pressures of scaling up begin to mount.


Cross the bridge when it comes, as they say.


That's when you'll have to make important decisions on how to proceed with your product development road map. 


So when the time actually comes for a full product release, don't be afraid to take a long hard look at the road that lies ahead, and making some difficult decisions now, rather than later.
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We've all heard from entrepreneurs, stakeholders, and literature such as 'The Lean Startup' about the need of the Minimum Viable Product (MVP).

But where does a prototype and MVP actually begin or end?

For MVPs, we only develop specific functionalities that a customer segment perceives as valuable.

Features that represent the broad base of what your customer segment would be willing to take out their wallets for.

And stripping back all the excess.

But how would you determine this minimal set-list anyway? 

That's where rapid prototyping comes in. 

Low-code or no-code 'dumb' solutions that test the overall premise of your proposition with the target customer segment, while keeping cost-effective.

The trick is to keep yourself at this prototype stage for as long as you can before starting to build an actual MVP. Because coding to build an MVP takes a lot more effort and resources, while also being a lot more costly to correct. 

So you want to have more certainty on what your customer is actually willing to pay for, before you commit the resources to build your MVP.

Of course there are exceptions to this, but the need to stay cost-effective and lean clearly remains. 

Especially in this macro-economic climate.

How are you navigating your prototyping and MVP process?
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A great reminder from Ash Maurya and the rest of the LeanStack team!

It takes time to build up your business fundamentals, no two ways about it. 

More so in the innovation space than anywhere else.

Finding Problem-Solution Fit and Product-Market Fit 🔗 is a drawn out validation process.

And it helps to carry out this validation 𝐖𝐈𝐓𝐇𝐎𝐔𝐓 building a product/coding for as long as possible!

This cost-effectiveness compounds over time, as the needs of your product shift when trying to find the right customer segment that buys 𝐄𝐍𝐎𝐔𝐆𝐇 of your solution to send you into growth mode.

Unfortunately, not all customer types are made equal in this regard.

You'll have to double down on the right folks (customer segment).

But first, you'll have to find them 👀

More on how to maximise the use of prototypes for this in our next post, and its difference to the highly enthused 'Minimum Viable Product'.

Have you had any success with testing the market without an actual product?
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We've been asked a lot about the best times to raise funds and what investors look for 💰
 
And very related to this, are the 3 core 'fits' that a new technology company has to meet, before becoming a thriving, profitable business.

Plenty of young companies make good inroads when it comes to determining the first stage of Problem-Solution fit, but struggle at the second stage.

Product-Market fit 🧩
In fact, many companies fail because they don't reach 'PMF' within their runway.

But what does it actually mean?

It means to have a proposition product or service that very much meets the needs of a specific and narrowed customer segment. This customer segment should be pinpointed in terms of their sector, industry, job roles, responsibilities, pains faced, and other 'stuff' they're trying to get done.

Paying attention to the latter bits, we want to solve the very human-centric challenges faced by the personas in that customer segment.

Two key points to this. Product-Market fit is found when:

👉There is consistent demand forming with that customer segment. i.e. you see the same level of engagement and appetite from other customers that match the analysis of the chosen customer segment
👉That customer segment is paying for the solution, even if it's a prototype/MVP and not a full product release. This is the ultimate indicator. But if they are not paying for the prototype, you should have very strong evidence they'd be willing to pay for it.
With enough of these two points as evidence, you'll have a much better vantage point of raising seed money, and even graduating to growth money.

But we'll save the conversation on growth and the third stage of Business-Model fit for next time.

What has your experience been with trying to reach Product-Market fit?
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