“Minimum viable product” means different things to different folks, but a few characteristics are certain: It should be simple, it should gather info, and it should be carefully defined

There’s plenty of jargon tossed around when it comes to technology and startup culture. “Minimum viable product,” or MVP, is one of those phrases. It’s a pretty important one, but unless you’re steeped in the world of startups, you might not have a clue as to what it means.

So let’s start with a definition from the man who coined the term, Frank Robinson, CEO of Santa Barbara-based SyncDev: The MVP is the product with the highest return on investment versus risk. In other words, an MVP is a utilitarian product that allows the team to collect the maximum amount of information from customers with the least amount of development effort.

For example, the MVP for a software firm could be the software’s beta version. At this point, the product had been developed, gone through multiple iterations, and is ready to be put into the hands of potential clients who will provide useful feedback. This product might be free, and its basic development makes it easy for users to update, improve, or patch.

If the business is building hardware, the MVP will be more vigorously tested and come with narrowly defined use cases. Even if there’s a relatively small cost associated with the product, companies won’t mass-produce hardware until it meets the needs of the target market.

Is MVP a process or a mindset? Both. Is it the go-to-market product, or is it an effort to find the right market? Both. We asked some startup founders, advisers, and investors about what a minimum viable product means to them. What they all agree on is that an MVP is narrowly defined, has no unnecessary features, and offers a plethora of information about what the customer wants.

JenneAlderksJenne Alderks

Founder, American Giving

Jenne Alderks started Bothell-based American Giving after being told by a leading nonprofit fundraising platform that it doesn’t focus on nonprofits in the developed world. Alderks — who has a background in family studies and early-childhood education — knew the United States has one of the highest rates of child poverty of the developed nations, so she began to create American Giving, a virtual marketplace that connects donors interested in a specific cause or region with nonprofits based in the U.S.

Alderks turned to the Founder Institute, a 12-week startup boot camp, for help in developing and building her idea. She graduated from the program in spring 2015. Alderks said her MVP is not just the structure of a marketplace, but a functioning marketplace with selections.

“(The) process has taken longer because I’m working on the timetable of nonprofits,” she said. “I’m coming into a space that’s already very saturated with funding opportunities, and it takes some time (for nonprofits) to develop messaging and learn a new system, so even now my MVP is very minimal.”

When Alderks entered the Founder Institute, her idea was to create a custom platform for American Giving, but her mentors steered her in another direction.

“Some of the feedback I got from mentors was that it could be really great to start with a white label (website service) because you have to work in this box and you have to fine-tune, and you’re not getting distracted by features,” Alderks said. “I wanted something that was going to be pretty basic in the beginning and affordable so I could scale it over time.”

Constantine_0098Constantine Korovkin

CEO and cofounder, Limefy

If you’ve been to a conference and talked to a dozen people before finding someone with similar business interests, Constantine Korovkin and Sveta Anikeeva know your pain. The duo founded Sammamish-based Limefy in September 2014 because they were frustrated with inefficient networking at events.

Limefy’s wearable device, LiGo, helps solve the basic problem of engagement by identifying attendees with similar interests with a colored blinking light. At a career fair, for example, a recruiter looking for a software engineer with experience in health care systems or Java could use LiGo to help sift through thousands of software engineers to find those with requisite experience. The product is handy at large functions and for introverts who loathe talking with large numbers of people. All the while, event organizers can see underlying metrics such as whether the data analysts are spending the majority of their time at the tourism or financial services booths.

Korovkin said LiGo is in its fifth iteration, and he considers the current product an MVP.

“It took us a few iterations to settle on it, but once we have everything working here, we can easily modify the form and put the technology into a wearable band, badge, or button. It’s not tied to a clip (LiGo’s current fastening method),” he said.

Future versions will feature additional services, such as an exhibitor experience, gamification, and real-time notifications. But with the matchmaking component solved and a few expo experiences behind it, Limefy now can go in search of more paying customers.

“The event space was identified as the easiest way to prove the concept and acknowledge that the technology works,” Anikeeva said. “But there are applications outside the event space we’re researching, such as education and behavior research. Anything that has any sort of interaction going on can benefit from this.”

Elaine-WerffeliElaine Werffeli

Angel investor

Eastside angel investor Elaine Werffeli sees MVP as a mindset, not a product. To her, having to change the product is not failure — it’s learning and moving with the market.

“We are creating that iterative cycle so you can succeed earlier and get a good product to market sooner,” she said. “I think the probability of a company coming out and nailing it right in the beginning is very low. If you are not using a minimal viable product mindset, you are taking longer. You are utilizing time, money, and resources to get to the point where you understand that the customer doesn’t want what you have.”

Werffeli was an investor in the fall 2015 Seattle Angel Conference, which uses a committee model to investigate the early-stage companies in which they invest. A 24-year Microsoft veteran, Werffeli identifies as a “data person” and prefers to see a history of iteration in early-stage companies because it means the founders are collecting customer data and are actively working toward a viable solution.

“If you take that MVP mindset in the beginning, and you create that product where you minimize the effort to maximize the feedback in a short iteration loop up front, you will probably still get it wrong in the beginning, but you will be able to learn from your mistake and move on. And that, to me, is the big difference,” Werffeli said.

John-Connors-(8)John Connors

Managing partner, Ignition Partners

Ignition Partners announced in May that it will invest its latest, $200 million fund in early-stage enterprise software companies, which means the venture firm will be having many discussions about MVP.

“It’s fun, it’s exciting, and it’s easy to envision what can be, but the reality is getting people to buy something for the first time from an early-stage company is really hard,” said John Connors, managing partner at the Bellevue-based firm. As a business adviser, Connors will examine the MVP with founders, talk to customers using the product, and ask a board of subject-matter experts to evaluate and comment on the product. Using that feedback, he and the founders will iterate the product until they can get paying customers.

Connors said the process can be different when working with serial entrepreneurs.

“If it’s somebody we know who’s had a track record of success that we’re really familiar with, we probably won’t even really spend any time on the MVP as an evaluation if we’re going to invest,” Connors said. “We will usually back that idea based on the market opportunity and the promise of the team.”

For software companies, product iteration can occur without much disturbance to the user, so getting an MVP to clients is crucial in ensuring market fit and growing a user base.

“Versus a physical product — even if it’s software that somebody installs on machines that they own and run and you don’t have access to them, or it’s a bakery that’s selling goods, or a piece of hardware — the completeness of the product has to be much farther along,” Connors said.

This article originally appeared in the January 2016 issue of 425 Business.