The most important thing in a startup is to know your customer and their needs as though you were them so that you can create a service or product that matches perfectly with the pain they are experiencing. This is not a one shot deal though. It is an iterative process that can only continue in a profitable direction if those that you wish to please are directing you.
This is where the minimum viable product or MVP comes in. Eric Ries defined the term by saying the MVP is the “version of a new product which allows a team to collect the maximum amount of validated learning about customers with the least effort.” this definition is also great advice to a startup. You are trying to gather as much information about the customer’s needs and desires so that you can begin to create a path to the idea or version of the idea that will cause you to reach the profitable destination. The MVP gives you a clear idea of what your product is worth to people and what aspects of your product might currently be missing or need to be trimmed off.
For example, Steve Blank interviewed one of the founders of a new product about the customer feedback that he had been getting. The founder was excited to find a statistic that his customers did want the information that they wanted to provide via a process which, while very cool, was potentially very expensive and excessive with respect to the desired end goal. Steve suggested that the founder do the same job but with much less work and money than was originally intended in order to iterate with “the least effort.” In other words, if you can spend less and work less for the same output then do it. If you do, then that efficiency will move you forward quicker and with less resistance towards a more profitable goal.