Let’s say, you want to build a new software application. Its type, complexity, and target goals don’t matter now but there’s one crucial question that you should ask yourself: is this app relevant to the company’s values and the market state? It’s the essence of the proof of concept.

A lot of companies misunderstand their product development ways. They invest in wrong projects, create dispensable products, target secondary audience, etc. Most often, this situation is typical for startups. According to CB Insights, 42% of new small businesses fail due to a lack of market need. 17% of teams face problems related to products that aren’t tailored to user requirements or ones based on poor business models. Other minor reasons also include mistimed launch, wrong geographical expansion, and bad pivot.

Startup Failure Reasons

But what if we tell you that it’s really simple to avoid these problems? Working with dozens of startups, SMEs, and even large corporations, we realize that research and analysis is an essential part of success. In our cooperation with clients, we usually run proof of concept projects before actual product development. What this is, how it works, and when it may be useful – find below. Also, we will share some of the prominent success stories.

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Proof of Concept 101

To begin with, it’s necessary to grasp the proof of concept (POC) idea. In short, it’s a research on whether your idea is viable or not. Want to build a next-gen Tinder-like app that helps people to find travel mates? Study the market, find competitors, survey potential customers, gather feedback. If people aren’t impressed, probably, you should rethink your idea.

In a more technical way, POC also may stand for a realization of any idea, project, method or approach that demonstrates its practicability and usefulness. Overall, there are different meanings of this term so it’s better to differentiate them. In the next sections, we will talk about proof of concept project types, benefits, and reasons to use this approach.

Meanings and Understanding

Generally, there are two things you should be aware of regarding our topic:

  1. Proof of concept (POC). The approach we’ve described above. It focuses on testing ideas, checking their demand, and attracting initial attention to the product.
  2. Minimum viable product (MVP). It’s the second stage. Once you understand that the idea is viable, you can create the demo product to show it to the audience.

At the junction of these points, proof of concept in software product development lays. It acts as both starting research and/or development study for dedicated teams. POC helps to determine if the planned software can be built at all, firstly. If the answer is positive, experts working on this project will find the most suitable ways/technologies to develop the target app. Hence, proof of concept also helps to cut costs and boost dev efficiency.

POC Benefits for Business

But there are more potential advantages. In the majority of our cases, we suggested adding this stage for a better understanding of markets, customers, and products. Particularly, POC is extremely useful for startups. While other enterprises with end-users aren’t familiar with new tools, they want to get clear guarantees of profitability and efficiency. Here, POC can help to create the most demanded product while MVP shows its strengths.

Thus, here are a few reasons why proof of concept is a good idea for your product development:

  • Avoid spending time/money on non-viable products.
  • Get significant proofs of idea worthiness.
  • Forecast any project’s feasibility and usefulness.
  • Receive detailed reports on project evaluations.
  • Test design, functionality, and user attitude.

Note that not all businesses need running a POC. For instance, if you received a governmental request on creating a large database for the army, just complete it. Extra research will be redundant and too expensive in this case. Similarly, if a team already has a large audience and famous products, it can risk and deliver new tools without verifying their feasibility. But it’s better to spend more on testing instead of creating unnecessary products, as a rule.

Aren’t sure about the expenses on POC and other development parts? Check out the article with a detailed breakdown of all expenses!

Typical Use Cases

The next question is: when you should opt for proof of concept at all? As we’ve said, not all companies require this preliminary stage to deliver a viable product. But there are a few cases when this approach is necessary.

Let’s say, a company studies markets to find the solution to one particular problem. We have a relevant example – BenefitNet, a system that supports intuitive management of all employees’ benefits under one roof. Without a doubt, this tool is useful as it simplifies in-house processes greatly. However, the question is in its feasibility. Here, POC helps to ensure that the planned app can be developed and will fit the client’s goals.

Another example is focused on product development itself. When a company realizes that the application is needed and that it’s feasible, devs should find the best technologies. POC allows us to test early dev cycles, identify potential problems, calculate the scope and expenses, etc. It also can pair with MVP creation to deliver a demo of the final product. Remember that this approach requires more spending than just feasibility tests.

How to Use POC Ideas

5 Steps to Your Ideal Proof of Concept

Like any analysis, the proof of concept model requires enough knowledge and skills of experts. Moreover, poor POC can harm more than a lack of analysis at all. It’s possible because you can get the wrong results and start developing on the wrong basis spending more and more on non-required products or services.

According to Graham Seel from BankTech Consulting, successful proof of concept projects must have the following four elements:

  1. Clear comparison metrics. They help to understand the real effects of apps/tools.
  2. Comparison details. Exact info about factors that change operations or processes.
  3. Enough data volume. It’s required for statistical correctness and representativeness.
  4. Trusted baselines. General points against which the results are compared.

Further, we list five steps to the best POC available for any firm regardless of the size, market, and other factors. Following this simple algorithm, you can set the minimum required basics of correct analysis.

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1. Start with the Real Need

At the beginning of the product development, understand the target audience’s needs and requirements. It’s the first stage of any POC project. Obviously, no products or services would be successful if they aren’t’ demanded by users. So, study everything possible to identify key pain points, not just guess them. You can interview stakeholders and acquaintances but then proceed to more data-rich surveys. As a result, you should get a detailed map of needs.

2. Connect Pain Points and Solutions

As pain points are identified, start the second POC stage. Deliver several solutions for each problem, analyze them, and choose the most efficient ones. Remember to keep the balance between performance, challenges, costs, and competitions. With the chosen solutions, return to customers and gather feedback about the proposed tools. This will be the second iteration of data analysis that helps to build an even more robust product.

3. Prototype and Test

The most basic demo version of the planned app should appear as early as possible. Forget about costly but unnecessary features – integrate only the basic parts. For instance, the first prototypes should include at least one core solution, as well as the planned UI/UX design. Then, start the third feedback iteration. Test your demo using reliable data metrics compared to baselines. Analyze the results and ask stakeholders about their attitude.

4. Create an MVP

Success stories are almost impossible without MVPs. A Minimum Viable Product is an advanced form of a prototype. Basically, it’s a feature-rich tool that can be released and delivered to users. It may come without secondary functions but it’s a ready product. While MVP product development costs more, it allows getting more valuable feedback. At this stage, it’s undesirable to change core features. Still, you can modify the design or extra tools if needed.

5. Gather Everything into the Roadmap

Lastly, it’s time to sit back and analyze everything once again. You want to collect all the data received during the previous steps to get the big picture. Based on it, design the roadmap with pain points, solutions, and, importantly, deadlines. This document will guide your dev team through the entire process. It should feature goals for each sprint plus the final goal. In a nutshell, ideal POC projects end up with clear roadmaps that don’t require changes at all.

Proof of Concept for Startups

Running a startup isn’t a simple task. New companies face more business challenges than established giants. That’s why proof of concept ideas are even more essential for fresh market players. If implemented correctly, they can boost your success rate and overall stats. From 44% of companies that fail to survive to the fifth year, we can move to much lower numbers.

The next two sections contain valuable tips & tricks for startups-based POC projects. As well, they share some inspiring stories of teams that used proof of concept and succeeded. If you aren’t interested in startup topics, take a look, too. The info will be useful for all business owners and managers who want to implement POC correctly.

Using POC for Startup Owners

The Best Introducing Path

To win a client’s attention, startups (and other firms that present new products) should opt for the best practices related to proof of concept. Look at the following steps that include these ideas. While we consider this algorithm one of the most efficient POC models, you can add or replace certain elements depending on your company’s segment:

  1. Position your offer. Focus on the whole industry, not on your firm or your clients only. It’s important to remember pain points and deliver proper solutions.
  2. Show specialization. It’s one of the most important success factors. Show that your team is professional and knows how to address clients’ issues.
  3. Understand the audience. Without a clear vision of the end-users, it’s impossible to run product development correctly. Thus, study customers.
  4. Deliver use cases. According to specialization, you also can engage clients with the finished projects, testimonials, and success stories.
  5. Offer win-win models. Use POC cooperation to allow users to work with the real product. Deliver free subscriptions and help clients to make better buying decisions.

Don’t forget to add a POC stage in your product development plan. You can start with our simple guide that includes 7 basic dev steps.

Success Stories Related to POC Implementations

For the conclusions, we’ve prepared a few thoughts from startup representatives who use POC in different ways.

For example, one of the most obvious options is just to demonstrate your product to users. This way is familiar for Tradeteq and Mitigram – systems that offer access to their functions before asking for payments.

Another approach is more traditional. During POC phases, companies can compare the results of their proposed products/services and existing client solutions to show the difference. It’s typical for Amberoon INTIX, for instance.

We also suggest customers begin with a proof of concept modeling. When you want to purchase a custom product, it’s better to understand its capabilities so POC can help a lot. Instead of paying for redundant features, you always can test the demo.

Evaluate Your Idea with Diceus

Proof of concept is a viable alternative to traditional analytical stages. For product development teams, it comes with higher efficiency and lower time spending. Using POC, companies can understand if the software ideas are feasible and how it can be realized. Simultaneously, for customers, proof of concept helps to test the product, check its features, and compare results between old and new software.

In Diceus, we always try to create only the most suitable applications. For this, we use POC variations to find ideas or development ways that would meet the clients’ needs. If you have just an idea and need to verify it, contact us. If you want an app for your business but don’t know which one, contact us. If you focus on the company’s digital upgrades, contact us. Probably, proof of concept will be useless for you. But we will propose other cooperation models, for sure. See you!