The downfall of numerous businesses and the failure of startups in 2020 have prompted entrepreneurs to postpone their dreams. Those who did start projects in 2020 are facing challenges and making one common mistake: not investing in proper planning and research. Many startup founders desperately try to minimize costs only to have their startups fail because in cutting their budgets, they also cut product quality, lose customer trust, and lose qualified professionals.
Take a look at the top reasons startups fail:
- 42% of startups fail as there’s no real need for their product.
- 29% fail as they incorrectly estimate the budget.
- 19% fail because they get outcompeted or for other reasons.
But there’s a cure. Even in the hardest of times, you still can launch a splendid product and avoid failure with a startup discovery phase.
By investing in project discovery, you can reduce risks, get answers to critical questions, discover market demand, test your concept, define your budget, and decide how to move on with your idea. Knowledge obtained during a project discovery phase will save you from mistakes and failures.
Today, you’re going to learn how to ensure your startup’s viability. Find out what the startup discovery phase is, why it’s so important, who’s involved in it, and what it looks like.
Three questions to answer to avoid startup failure
Startup founders often underestimate the meaning and importance of market research and analysis — essential components of the project discovery phase. It may seem like this data-driven process just holds back you and your team from making real decisions, taking action, and making progress. In reality, a well-planned discovery phase with valuable deliverables is the springboard every startup needs to launch.
The project discovery phase provides reliable answers to three critical questions:
- Should I really do this?
After the visual configurator platform Treehouse Logic shut down, its founder shared this insight:
“Startups fail when they are not solving a market problem.”
This is the most common reason young businesses fade away. Launching an impeccably designed application means nothing if no one wants to use it. It’s just a waste of time and money spiced with destroyed ambitions.
One of the key goals of the startup discovery phase is to make sure there’s rising user demand for a solution. At the same time, it shows whether there’s space among competitors and a gap in users’ satisfaction that your app can fill.
During the discovery phase, you make sure that your startup is really worth the effort.
- Can I do it better?
Kevin Systrom and Mike Krieger, the founders of Instagram, were initially inspired by the idea to launch a Foursquare-like app. It took some time for them to pivot and opt for a more profitable photo sharing app.
Whether you’d like to launch an app similar to Instagram or you have an extraordinary idea for a brand-new social media app, it’s always possible to make your app better. When starting your business, it’s critical to convert the uniqueness of your idea into app functionality. This will help you both catch the attention of your first users and attract potential investors. The discovery phase helps you prioritize critical features, cut unnecessary ones, and come up with ways to improve your idea.
The discovery phase helps to turn good ideas into great startups.
- How many resources does my startup require?
Another way of asking this is How much does it cost to build a software app? or How long does it take to build a startup from scratch? These questions are hard to answer. If you try to find the answers on Google, you’ll see promisingly titled web pages, but none of the content you find will correspond to your particular business.
Making a detailed estimate of the resources required to launch your startup requires a clear understanding of your idea, your market, your team’s location and size, and a bunch of other information.
The project discovery phase is a straightforward way to better understand your product and, as a result, get precise estimates of what’s required to launch your product. This phase helps you define how much time and money you need to achieve your business goals and win investors’ attention.
The discovery phase helps you define your budget, optimize costs, and develop a strategy for the shortest time to market.
Project discovery team
Following our guide, you can handle the startup discovery phase on your own or in cooperation with a co-founder. However, the process may be complicated and time-consuming. You’ll need to devote hours and hours to research, investigation, analysis, and design. You should dive into the specifics of the MVP architecture and decide on a technology stack. Even if you have proficiency in software engineering, the process may take too much time and energy.
Another way to optimize resources and save your time for essential business tasks is to delegate the project discovery phase. A project discovery team typically consists of specialists with years of experience in software development. They may have an impressive portfolio of successfully launched MVPs and should be able to deliver great results in tight timeframes. Let’s meet the team of specialists you’ll need for your project discovery phase:
- Product owner
The product owner is the person who had the initial idea for the product. As a startup founder, you have a clear vision of the startup idea and have assumptions about who needs your product and how they will use it. During the discovery phase, you can explain your idea to your discovery team and work on product analysis and improvements together.
As a product owner, you’ll be involved in product development, but a major part of the analysis and planning, as well as design and development, will be someone else’s responsibility.
- Project manager
A project manager is responsible for ensuring flawless communication and proper planning of the scope of work. The PM documents the scope of work and tracks the progress of the project discovery phase.
- Business analyst
A business analyst researches how to meet existing needs with a real business solution. They study potential users’ needs and help to improve the product and make it better fit demand.
- UI/UX designer
A UI/UX designer focuses on creating an attractive interface and uninterrupted user experience. Together with the project manager or business analyst, they study end user preferences to make your product as appealing as possible.
- Software architect
A software architect analyzes the initial requirements and offers tools and methodologies for developing a high-quality app. A software architect develops your product’s architecture and logic and takes part in estimation.
- Software tester
A software tester develops a test plan, which is the basis for properly testing your MVP.
The size of your team may vary. It depends fully on your vision, the preparation steps you’ve already taken, and the deliverables you expect. Now, let’s look at the components of the discovery phase.
What the project discovery phase looks like
The typical product discovery phase consists of seven main stages:
Describe project goals
Roles involved: the entire project discovery team
The project discovery process starts with a kick-off meeting. During this meeting, you share your vision with the project discovery team. Together, you then look for answers to the following questions:
- What are the biggest problems the potential user may face?
- How can your product solve these problems?
- What does the typical user look like?
- How does the product differ from similar apps?
- How can we monetize the product? What is the expected revenue?
This meeting may be cut into several sessions. The questions you discuss may differ and expand depending on the project’s specifics and your requirements. During this stage, you’ll interact with the whole discovery team to develop a lean canvas, or a business model canvas, containing general information about your product, its unique value proposition, expected revenue, its target audience, etc. A business model canvas provides a quick, simple, and initial description of your business idea and its purpose.
- Lean canvas — a document describing essential information about your startup
Create a value proposition canvas
Roles involved: product owner, project manager, business analyst
The only way to succeed in a defined niche is to give your potential customers the design and functionality they want and need. Here’s when a value proposition canvas comes in handy. A value proposition canvas connects the product you plan to launch with customers’ real needs.
A value proposition canvas is built on top of a business model canvas. It offers a detailed, structured description of the Customer Segment element of your business model canvas. In your value proposition canvas, you highlight the value your product will provide.
This document includes two interconnected components — a customer profile and a value map — that describe critical features of your user persona and product, respectively. Customer jobs, gains, and pains fall under the customer profile. Product and services, gain creators, and pain relievers fall under the value map.
Value proposition canvas
Customer jobs — Tasks users may want to solve with your app
Gains — Benefits users may expect
Pains — Negative experiences users may suffer from
Product and services — App features that may create gains and relieve pains
Gain creators — Features that create value for users
Pain relievers —Things that address users’ pain points
The more precisely the components of the customer profile are reflected in the value map, the better the chances your product will be popular and in demand.
- Value proposition canvas — a graph describing connections between a customer profile and a value map
- Product vision — description of problems your product is expected to solve and how it will solve them
Research the target market
Roles involved: business analyst
Competition is intense and cruel. Even if it seems like your idea is one of a kind, existing products may already satisfy user demands and leave no space for your app.
Thus, comprehensive market analysis is the next step of the project discovery phase. What’s the point of researching your target market?
- It allows you to get to know your competitors’ strengths and weaknesses.
- It’s a way to find out about similar startups that failed (or are about to fail) and avoid their mistakes.
- It’s a straightforward way to reveal potential risks.
- It’s a crucial step you need to take to start raising funds.
How can you properly navigate the target market research stage? We do it by following four basic steps.
- Identify similar businesses.
- Analyze their products, investigate users’ feedback, and even try them ourselves.
- Find existing problems and decide how the product can meet them.
- Conduct SWOT analysis to reveal strengths, weaknesses, opportunities, and threats.
Research may turn into a time-consuming process if you try to handle it yourself. However, with an experienced team at your back, you can cut the time invested and get valuable results out of routine research.
- SWOT document — a framework for analyzing your startup’s strengths, weaknesses, opportunities, and threats
- Risk assessment and mitigation plan — a table of risks your project may face and how to minimize them
Decide on the technical implementation and build a proof of concept
Roles involved: project manager, software architect, software tester
This stage is crucial for identifying potential technical bottlenecks and discovering how they may affect the entire project. It’s also when you can test your product’s vision and make sure it’s technically feasible to implement it.
During this stage, the discovery team prioritizes the essential features and creates simple technical prototypes to make sure your idea is reflected in your software solution.
The technical implementation and proof of concept stage is optional, as its primary purpose is to prove you’re on the right track and to make sure it’s possible to build specific product features with a defined technical toolset.
- Product architecture — a description of your app’s structure, including patterns and techniques used to build it
- Development plan — a step-by-step plan to implement all features, including a description of necessary services and tools
- Test plan — a list of actions and tools needed for proper functionality and interface testing
Develop an interactive prototype
Roles involved: business analyst, UI/UX designer
The dedicated efforts of a business analyst and a designer bring an interactive, clickable app prototype to life. This prototype may differ from the final version of the app, but it should present all the screens and model the entire user journey.
Testing a prototype helps you test the UX and make sure the design is intuitive and user-friendly. But an interactive prototype also pursues another critical goal: collecting the first user feedback so you can take measures to improve your product or pivot if needed.
To test your idea more thoroughly, your team may deliver several prototypes and compare users’ feedback after trying them all.
- Wireframes — blueprints of your app’s screens
- Prototype — an interactive model of your app
- Design guidelines — a set of design principles for your product
Roles involved: product owner, project manager, business analyst
Coming to the finish line of the discovery phase, the team works on a variety of tasks and documentation including the design plan and user stories, the app’s architecture and logic, and the management plan. The precise list of documents will depend on your requirements, the project’s needs, and your goals.
- Product requirements document — a detailed description of how the product should work and look
- Product roadmap — a map of the product’s growth
- Product growth approach — a set of techniques to drive user acquisition and product success
Estimate the time and cost for development
Roles involved: product owner, project manager, business analyst
When you described your idea for the very first time at the kick-off meeting, all you could get were rough estimates. The team may have provided you with approximate time estimates and vague answers about the app’s cost. But at the start of the project discovery phase, your team didn’t have all the details about your idea and they didn’t fully understand its purpose and potential. Thus, they couldn’t provide you with a definitive estimate.
Now, with a clear vision of your concept, your goals, and your product’s value — and after deep research and a thorough comparison of your idea with existing offers on the market — your team can give you a more precise and transparent project estimate. They can also give you a well-prepared plan of action so you know what exactly you need to do to succeed in the target niche.
- Project charter — a document containing the scope of work and project participants
- Feature breakdown list — a table describing essential product features and the time needed to build them
- Cost estimate — a table showing the budget you need for each stage of your product’s growth
Project discovery phase: time and deliverables
The duration of the project discovery phase varies widely. A product owner may come to a development team with a definite list of must-have features and a simple mockup. Or a product owner may reach out with only a basic presentation of their idea. Depending on the level of advance preparation, the project discovery phase may take one to four weeks or even longer.
What will you get by the end of it?
Again, it depends. Your needs and requirements will impact the list of deliverables, but these are the most common:
- Business model canvas
- Value proposition canvas
- SWOT analysis
- Interactive prototype
- Design guidelines
- Product requirements document
- Product architecture
- Feature breakdown structure
- Development plan
- Test plan
- Risk assessment and mitigation plan
- Product roadmap
- Product vision
- Product growth approach
- Project charter
- Cost estimate
With a set of deliverables that help you plan your product development, you can either start developing your product with our team or delegate the engineering to another software development service provider. After a thorough project discovery phase, you’ll have a clear vision of your product’s specifics, strengths, and value, setting your startup on the path to success.
Contact us and find out how to save it from failure with a project discovery stage.Contact us