When building software, companies move through different stages to validate, design, and test their products before launching at scale. The four key stages—Proof of Concept (PoC), Prototype, Minimum Viable Product (MVP), and Pilot—each serve a distinct purpose in the software development lifecycle.
Key Differences at a Glance
PoC
Can this work?
Technical feasibility validation
Prototype
How will this look/feel?
Design and UX validation
MVP
Should we build this?
Market validation with core features
Pilot
Does this work in the real world?
Pre-scaling real-world validation
1. Proof of Concept (PoC) – Testing Feasibility
A Proof of Concept is a small-scale test to determine whether a specific idea, technology, or approach is feasible. This step helps businesses avoid investing in full-scale development before confirming that a key aspect of the product works.
📌 Business Impact:
- ✅Saves time and money by preventing investment in unproven ideas.
- ✅Helps secure stakeholder or investor buy-in by demonstrating feasibility.
- ✅Reduces technical risks by identifying potential roadblocks early.
Example: A company developing an AI-based chatbot first tests whether the AI can accurately understand customer queries before building a full product.
2. Prototype – Visualising the Product
A Prototype is an early visual or interactive representation of the product, typically used for user experience (UX) validation. While it may not be functional, it helps stakeholders and users understand the design, layout, and flow of the software.
📌 Business Impact:
- ✅Enables early feedback from users and investors, reducing future design changes.
- ✅Aligns product vision among developers, designers, and stakeholders.
- ✅Enhances fundraising efforts by providing a tangible demo.
Example: A startup designing a mobile banking app creates a clickable wireframe showing how users will navigate between screens.
3. Minimum Viable Product (MVP) – Testing Market Demand
A Minimum Viable Product (MVP) is the simplest functional version of the product that solves a core problem. It allows companies to validate their value proposition with real users while keeping development costs low.
📌 Business Impact:
- ✅Provides early market feedback, preventing costly full-scale development failures.
- ✅Speeds up time-to-market and allows businesses to iterate quickly.
- ✅Attracts investors by showing real user engagement.
Example: A food delivery startup launches an MVP with only essential features—restaurant browsing, ordering, and payments—before expanding to add ratings, tracking, and loyalty programs.
4. Pilot – Testing in a Real-World Environment
A Pilot is a small-scale deployment of the product in a real-world setting. This phase ensures the product performs as expected before a full-scale launch.
📌 Business Impact:
- ✅Identifies operational or technical issues in a controlled setting.
- ✅Builds early adopter advocacy, generating word-of-mouth marketing.
- ✅Helps secure large-scale adoption by proving success in a limited rollout.
Example: A SaaS company releases its CRM software to a single department within an enterprise to test its effectiveness before rolling it out company-wide.
Final Thoughts: Choosing the Right Stage
For startups and established businesses, knowing when to use PoC, Prototype, MVP, and Pilot can significantly reduce risk and increase the chances of success.
PoC
Use when testing technical feasibility.
Prototype
Use when refining the design and user experience.
MVP
Use when validating market demand.
Pilot
Use when preparing for full-scale deployment.
By following these steps in the software development lifecycle, businesses can create products that are technically feasible, user-friendly, and market-ready.