When you hear the letters MVP, the first image in your mind might be velvet ropes, invitations in perfectly pressed envelopes and the royal treatment. However, for those of you immersed in technology, it means something altogether different.

The startup entrepreneurs’ MVP is the Minimum Viable Product. It is part of the lean startup approach to ideation, market validation, and product or service development.

Being a startup founder and entrepreneur is, in many ways, similar to being a trader. After all, trading involves uncertainty, testing, research, market exploration – all things that are part of the startup experience.

As a new trader, you may be looking for ways to develop a trading plan or an approach that fits your personality. You may be researching technical analysis and the fundamentals.

The question is, how do you put it all together?

What does that look like?

Well, developing your initial trading approach is a lot like a startup MVP.

Let me explain.

A startup is defined as a human institution

Eric Ries, author of the Lean Startup, defines a startup as “a human institution designed to create a new product or service under conditions of extreme uncertainty.”

You start with an idea or concept designed to solve a problem. You then take this idea out to potential customers to discover whether your solution has merit.

These customer interviews reveal the strength or weaknesses of your thinking.

For example, you want to know how significant the pain you are trying to solve is. How urgent a solution is required. And of course, whether they are willing to pay for it today.

The interviews may reveal that your idea isn’t a good one. Or you might discover a more important problem requiring a solution.

With results in hand, you go back to the drawing board, develop your next hypothesis, and test that through further customer interviews.

This initial process is a lot like the way you develop your initial trading plan.

Trading, the other human institution

Like the startup founder, the crypto  trader will be developing a trading idea or system under “conditions of extreme uncertainty.”

You’ve seen how Bitcoin and Ether move around. All those DeFi opportunities are compelling and, depending on your risk tolerance, even a little scary.

So you are going to work towards a system or approach that helps you operate in that environment.

Your hypothesis or trading idea will be based on your research, observation and experience.

Like the startup founder, you want to have a way to test that idea. And what you won’t often hear in trading is that you have two elements where testing will take place.

You have an external place to test the idea. That’s the crypto market.

And instead of an interview with a customer, you have an internal environment for testing. This is your emotional state.

Start your crypto trading idea with the internal test first

Every trading plan you make will be limited by how you formulate and execute it. And the way you formulate it and execute it will be based on how you feel inside.

Understanding your emotional state and being ok with it is an important part of testing your trading idea.

And this starts with some deeply personal evaluation.

What is the problem you are trying to solve with cryptocurrency trading?

-> Perhaps you want more money or to be more independent

-> You may want to be your own boss

-> Maybe you want to learn something new

-> Discover what freedom and agency means

-> Perhaps you want some active entertainment

When you identify your internal desires and state, you can more accurately align your idea and execution. Because when you put real money on the line, these points will either help or hinder your ability to test your idea effectively.

So interview yourself and make sure your approach and beliefs are aligned.

Next, you will develop your Minimum Viable Product or MVP for the external test. But as every startup founder knows, the MVP always has a potential pitfall.

The problem with the startup MVP

For the entrepreneur, the Minimum Viable Product is the website, service, product or prototype.

You launch your MVP into the market to get feedback on how people interact with your webpage, app or service.

The beauty of the MVP is that it doesn’t have to be perfect or complete. This is because it’s an information-gathering tool. It will have flaws and lots of room for improvement.

Those will be addressed with the ongoing development of your idea and feedback from your market.

But the MVP stage is one of the most difficult. This is because your MVP puts your idea to the test of the market. It exposes your idea to criticism.

The need to be perfect is overwhelming for some entrepreneurs.

The desire for it to be successful or  “not suck” can be consuming.

That is why so many entrepreneurs struggle to put their MVP out there.

They are trying to make sure everything is there. That nothing will go wrong.

So they delay the launch.

This delay, analysis paralysis, fear of failure is the big problem with your typical MVP.

And so it is with traders.

Test your crypto trading MVP with a trade

The trader’s MVP is the trading plan. Putting your idea to the test can be nerve-racking and exciting.

It means offering your trading idea or approach to the uncertainty of the market.

It is taking your money and putting it at risk.

It means you might be wrong, and you might lose money.

So you may hesitate and delay the execution. Fueled by analysis paralysis, you might feel like you have to do more research – driving further anxiety.

The only way to see if your idea is going to work is to execute your plan.

The only way to gather valuable information about your approach is to put the trade on.

The only way to become informed about your internal response to the trading process is to actually trade.

If you did the internal interview, you can follow your plan. If you know why you are doing this, you can quiet those voices inside and start to gather information.

And all of the data points provided by your MVP will give you the necessary feedback for your next step: Iteration.

Iterate your trading plan like a startup founder

From the real-time feedback on the MVP, the startup founder will make adjustments. They will be finding ways to enhance user experience, correct obvious problems, and reduce the biggest risks first.

The entrepreneur will explore questions about their MVP like:

-> How was the service or product used?

-> Did the webpage engage or repel those that landed there?

-> Do customers engage with the product or service over a longer or shorter time?

-> Are they returning to or abandoning the site?

-> Is there unnecessary friction in the user experience? Has product-market fit been established to drive scaling?

The founders will work quickly to address and derisk these issues and retest.

As a trader, you will be gathering external and internal information by observing the trade and execution of your plan.

Iterating your trading MVP

Your trade has various parts to it. It has activities leading up to the trade, like research and development of a trading idea. Then comes the development of your trading plan.

Then comes the execution. This is putting on the trade you mapped out in your plan and either maintaining it or exiting.

Then comes the postmortem. Here you look at what happened and why. Then you look at where you can improve and make adjustments for the next one.

You will want to see:

-> How did you feel? And did that feeling conflict with your execution?

-> Did your idea work as expected?

-> Did you follow your plan, and if not, why?

-> Did you have a profit or a loss?

-> Was the profit or loss the result of an unexpected event?

-> Was the position size good?

-> Is your trading strategy scalable?

You will take the information from these and other trades and iterate your approach.

Over time, like the startup founder, you will have an evolving trading MVP designed to maximize returns in your market.

Every trade builds on a foundation

The startup founder is faced with constant challenges and uncertainty, just like you are. A system has been developed over time to help operate in that environment. It’s called Lean Startup.

And you can use elements of that in your trading development and advancement.

You want to be open to changes in your skills and the market.

You want to incorporate what you learn and observe. Then develop your own set of trading rules.

And to be comfortable with following trading plans that will produce information through profits and losses.

Everything is information to help you scale up your trading approach in the right conditions.

And that includes your internal reactions to your trades, execution and trading plans.

That is how you turn a simple idea into an MVP and a source of coin.

 

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