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MVP - The DropBox Story

Updated: Aug 1, 2022

In this video, we look at the how Dropbox mitigated the 2 big risks that a startup faces with a creative Minimum Viable Product which probably involved very little coding effort!!!


If you would rather read than watch, the transcript is below the video ๐Ÿ˜ƒ



In today's video, we will look at how Dropbox with their innovative MVP mitigated two of the biggest risks that a startup faces. And the real kicker here is that Dropbox probably did not write a single line of code to develop their MVP. So what are the two big risks that a startup faces?

  1. Demand risk - you're building something that customers don't really care for.

  2. Design risk- the way you're solving the problem for the customer leaves a lot to be desired and customers are not really happy to pay for the solution that you're offering.

With that context set, let's get on with Dropbox. For those of you who are not familiar with Dropbox they offer a cloud storage solution. So if you're a registered user with Dropbox you get 5GB of free storage on the cloud and you can access it from any device be it a computer a mac or a windows. Or a smartphone or a tablet or even from a web browser. And if you're a premium user you pay for a certain amount and you get much more storage on the cloud. Before dropbox how we used to carry important files around was we used to either have usb sticks, or carry around portable hard disks that you could plug into any computer and access your storage. And if you didn't have either of these, the third option was to email important files to yourself as an attachment so that you can open your email on a browser and access those important files. Now the story goes that in 2007 Drew Houston, who's the CEO and founder of Dropbox was a student, and he used to often forget to take his usb stick, and he came up with the concept of a cloud storage. Drew then pitched this idea to several VCs, but the common response he got from the VCs was:

  1. the solution was too expensive and complicated to develop

  2. this was not really a critical problem for customers and therefore they would not be willing to pay for it.

Drew and his team however were convinced that this was a valuable problem for users and that they were solving it in a very elegant fashion. So what they went on to do was to record a short video using product prototypes and explaining various use cases. And once they had this video ready, they uploaded it onto a website called Digg. which was where technology early adopters used to hang out. These are users who seek out new technology and new use cases of how technology is used, just for the joy of using new technology. Along with this video they also had a form where users could sign up to be notified when the beta version was ready. Literally overnight the beta subscription went from 5,000 users to 75,000 users! That's a 15x growth!!! If you haven't seen the original Dropbox Video, I would strongly encourage you to take a look at it for inspiration. To me there are two key learnings from the Dropbox MVP example.

  1. They were able to develop this MVP without investing a lot in developing the product. They were able to take mockups and prototypes of the product and stitch together a video which conveyed to users how it would work. This was a very creative way of validating both demand and design.

  2. The way they published this video on a platform where the technology early adopters used to hang out. So they were actually reaching their target audience in a very effective way.

To understand the behaviour of early adopter story, check out this story of how BIRA cracked the beer market in India. But coming back to Dropbox, the Dropbox MVP is of a legend in product management circles when it comes to MVPs. And even today you'll see websites where you will see a link and when you click on that link you go to a page which says coming soon!. If you're a logged-in user the company gets to find out how many users clicked on that link and the profile of the users so that they have a better sense of who's looking for this. This helps them develop the product better. All this before spending significant development dollars. I have seen too many product teams try to invest a lot of time and resources in developing products and sometimes even spending a couple of years developing the product and then taking it to market only to find out that customers are not really interested in your offering. That is a huge setback from a team motivation perspective, opportunity cost and also just the amount of investment you would have made in developing the product.

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If you're working on a product on a new product or looking at adding features to an existing product to take it to a new market and you want to look at creative ways of developing your MVP and you want to bounce off ideas ...


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