How Minimum Value Tests Lead to Successful Startups

Blog Introduction: Everyone in the startup world has heard of Gagan Biyani, the CEO of Maven. He has successfully created three startups out of four, which is a pretty good track record. What is his secret? Gagan believes that having the right approach to building and validating ideas is essential for success. In this blog we’ll explore why minimum value tests (MVTs) are more effective than the traditional minimum viable product (MVP) approach when it comes to predicting success.

The Problem with MVPs

The MVP approach has become very popular in recent years as a way for startups to quickly validate their ideas with customers by releasing a basic version of their product into the market. However, this approach can often lead to overbuilding products before they have been tested with customers, as well as relying too heavily on customer feedback before making decisions about what features should be included in the final product. As Gagan puts it, “MVPs focus on building rather than delivering value”.

Minimum Value Tests as an Alternative

Gagan believes that a better alternative to the MVP approach is using minimum value tests (MVTs). MVTs are focused on testing hypotheses about customer needs and preferences before investing time and money into building a product. This allows startups to identify potential pitfalls and make adjustments early on in the development process, thus leading to a higher likelihood of success down the line.

Gagan’s 2-Step Framework in Action: Examples From His Career

Example 1 – Lyft: Navigating Regulatory Hurdles

The hypothesis behind creating Lyft was that people would be willing to pay for ridesharing services if they were convenient and affordable enough. To test this hypothesis, Gagan developed an experiment where they offered rideshare services in San Francisco despite regulatory hurdles from taxi companies and city officials—the MVT approach for Lyft! This experiment proved successful, resulting in regulations being amended so that Lyft could continue operating legally within San Francisco city limits.

Example 2 – Udemy: Validating the Online Education Market

The second example involves Udemy, an online education marketplace founded by Gagan and his team back in 2009. Their hypothesis was that there was an untapped market for online education courses offered by professionals at reasonable prices—and once again they turned to their MVT approach to prove it! The experiment involved offering free courses online while collecting data on customer responses and behaviors surrounding those courses—which ultimately led them to conclude that their hypothesis was correct!


It takes more than just hard work or luck for startups to succeed—it takes having the right approach when it comes to validating ideas with customers before investing resources into building out full products or services. Minimum value tests (MVTs) offer a better alternative than traditional minimum viable products (MVPs), allowing startups gather valuable data without having to invest too much time or money upfront. By following Gagan Biyani’s 3-Step Framework for developing MVTs, entrepreneurs can increase their chances of success dramatically!

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