The tech world has the highest startup failure rate (63%) of any industry.
While the profit margins and revenue-per-employee potential are also high, the risks are just as great. Software takes a huge upfront investment, and there’s no guarantee that you’ll break even.
And once your product is profitable, better teams can distrupt the market at any time.
New competitors come with better features, faster innovation speeds, cooler branding, and lower prices.
As an entrepreneur or product owner, your product vision is what guides your entire team forward and keeps you competitive in crowded markets.
You need full clarity on your product vision at every stage of business—from initial development to scaling up and expanding.
What is a product vision?
A product vision is a set of guiding principles for the development of a product. These are guardrails that keep the product on track towards achieving its main objectives—including catering to a specific audience, differentiating from certain competitors, avoiding feature bloat, or any other strategic goals.
When your startup has a product vision, you’re more likely to succeed in the long run, because you’re not just catering to customers’ whims. You’re also building a company with full awareness of your strengths, weaknesses, capabilities, and competitive advantages.
A clear vision is an essential product management technique because it inspires your product team and helps them understand the reasoning behind various roadmap decisions and sprint cycles.
Who owns product vision?
In the early stages of a startup, the product vision should be fully owned by the founder. It’s the founders’ initial investment, funding plan, talents, and abilities that will bring the product to life. So, that person needs to have full clarity on how they will guide the product to not only satisfy user demands but also be technologically and financially feasible.
In more established organizations, the product owner might be the Chief of Product, VP of Product, or Product Manager. If your business sells multiple products, each one should have a product owner who maintains and curates the vision.
How to create your product vision
Now, it’s time to craft a product vision that aligns with your product strategy and product value.
The following steps are essential for ensuring that your vision is accurate, fully aligned, and helpful.
Writing a nice fluffy statement isn’t enough. You have to put in the work.
Step 1. Determine your unfair advantages
The first step is to figure out what makes your company special.
Knowing your unfair advantages can help you stay on top. These advantages should be utilized and protected (not ignored), but you can’t do that if you don’t first identify them.
If you’re just starting out, these would be your unfair advantages as a founder, such as any professional experience you bring to the table, the knowledge you have of your users, your eye for great UX, or anything else.
For an existing company, this could be the talent of your team, how you run agile development, how far ahead you are of your competitors in terms of features, the quality of your UX, your market share, etc.
Step 2. Get clear on funding and runway
Let’s face it. You can’t build a massive product if you don’t have the runway.
Your product vision needs to be financially reasonable.
So, be sure to have a clear plan for funding and a good understanding of your startup’s runway. If you’re launching a new product, how many months will it take for you to break even? If you already have a successful product, how many months or years of runway do you have?
If you don’t have a lot of runway left, your vision shouldn’t be too grandiose (unless you have other plans for funding). But if you’re killing the game and have tons of runway and want to put even more space between you and the competition, go ahead and dream big.
Step 3. Know your target users
Next, it’s time to clarify your target users. Ultimately, your product is built to satisfy their needs. Every roadmap decision should be based on end-user goals.
For a B2B product, these are the top criteria to define:
Industry
Role
Company headcount
Company annual revenue
Technological sophistication
Existing solution
Geographic location
For a B2C product, these are the top criteria to define:
Job/task to be done
Age
Gender
Geographic location
Interests and hobbies
Step 4. Define the problem
Next, it’s time to define the core problem that your users are experiencing. Are they struggling to help their team be more productive? To collect attribution data? To manage their staff’s tasks?
List out the top three or four interrelated problems that your target audience is struggling with. For a clear product vision, you don’t want to tackle any more problems than that, at least not initially.
If you end up building a vertical product (with only one target industry), you can later solve more problems for your users. But if you’re building a horizontal product (one that solves the same issue for any industry), you’ll want to keep the problems more narrowly focused.
Step 5. Write out your solution
Now it’s time to write out your solution. In a sentence or two.
Defining your solution is the same thing as writing a product vision statement. Both showcase how you will solve the problem for your users. For example, “X helps office managers manage guest check-ins, desk and room reservations, office supply inventory, and employee announcements all in one place.”
Keep scrolling for even more product vision statement examples below.
Step 6. Choose your competitive differentiation
What sets your product apart from competitors? Knowing that is paramount to an accurate, aligned product vision. To gain a cult following, your product needs to be different in some way. It should have better UX, better pricing, more customizable pricing, more customizable features, etc.
Thoroughly research your competitors’ products by exploring their website, customer reviews, and customer support articles. If the software product is self service, sign up and use the product to get a feel for the features and user flows. If it’s only sold via demo, you could try watching tutorial videos to understand the features.
Ask yourself these questions to understand
What unique features or functionalities does our software offer that our competitors do not?
How does our user experience stand out from that of our competitors?
What specific problems or pain points does our software solve for our target customers that competitors do not address?
Do we offer any proprietary technology or algorithms that give us an edge over competitors?
How do our pricing models compare to those of our competitors, and what value-added services do we offer at each pricing tier?
What kind of customer support or service do we provide that sets us apart from competitors?
How does our company culture and values differentiate us from competitors in the eyes of customers?
Have we received any industry recognition, awards, or certifications that distinguish us from competitors?
How do we leverage data security and privacy measures to reassure customers and stand out in a crowded market?
What is our unique selling proposition and how is it different from our competitors?
Step 7. Identify pilar features
The next step is to identify your pilar feature or features. For a brand new product, this would be the one feature that you must develop for our MVP. The feature that will convince users to become customers and actually pay for your product. The feature that—without it—you have nothing to offer.
A more established product might have a few different pilar features. Together, these features represent the value your users get out of your product. The rest of your features support these pilars.
It’s important to define your pilar features at every stage of product development so you’re always aware of what matters most. You can organize your sprint cycles and build feature requests that align with your pilars.
Step 8. Develop a user story map
Now it’s time to develop a user story map. This is essentially the flow of the most important tasks that users need to complete.
Here’s an example we’ve created for our sister company, DevStats, a platform for tracking dev team productivity and performance.
You can create a user story map by putting the top four to seven tasks in little cards at the top of your digital whiteboard. These can be your pilar features. Then, add the required sub-tasks below them.
Or, you can use this user story map template from Miro.
Step 9. Keep track of your break-even point or profit
Your product vision isn’t just some wishy-washy idea of something you want to happen. It’s a strategic vision that makes your business profitable.
That’s why it’s so important to keep track of your financial data. For a new product, you should calculate your break-even point (learn how here). Your break-even point is the number of months until your investments will zero out. This depends on how much you’re investing each month, your expenses, and your sales.
For a more established product, you should keep track of your profitability, cash flow, and runway.
If your break-even points becomes farther away—or if your business becomes less profitable—that means something is wrong. Either your development team isn’t innovating quickly enough, your expenses are too high, or your product vision isn’t as competitive as you thought it was.
Take the time to get to the bottom of the issue and adjust your product vision accordingly.
You might need to scale back your features, pivot to catch up with competitors, or redefine your audience to make your vision more realistic and meaningful.
How to document your product vision
The best way to document your product vision is with a template or board that covers the full spectrum of your vision—from users to features to competitors.
We created the one-page SaaS Blueprint template to help you document your vision and organize all the essential parts in one place.
The template includes unfair advantages, target users, problem and solution statements, competitors, pilar features, user story map, your revenue model, average deal size, and revenue projections.
This way, as a product owner, you can keep track of all of the elements that go into your comprehensive vision and all of the factors you need to consider when adding to your roadmap.
In addition to a vision template or board, you might also want to write up a short product vision statement that you share widely with all team members.
5 examples of product vision statements
Below, we’ve created 5 examples of product vision statements to inspire your own.
1. Christian school parent research
Parent Pulse gives private Christian schools all of the tools they need to gauge parent satisfaction, increase retention, and plan for the future.
Read our case study with Parent Pulse to learn how we built and launched this profitable SaaS in under 4 months.
2. Travel management
TravelPerk helps business travelers book trips on their company’s dime and get all of the support they need throughout the process. Meanwhile, office managers have full control.
3. Business and marketing management for accountants
CountingWorks PRO offers accounting firms the easiest way to build, grow, and run their firm in one place.
Learn how we rebuilt CountingWorksPro for increased scalability and engagement—but lower monthly development costs.
4. Email newsletter platform
Substack makes it easy for content creators to monetize their social media audiences with premium newsletter subscriptions.
5. Sales email generation
Lavendar offers AI-powered email generation to help sales development representatives write personalized emails lightning-fast—and with better UX and fun, irreverent branding.
3 essential product vision tips for entrepreneurs
Follow these tips to create a comprehensive product vision that really works for you as an individual entrepreneur.
1. Narrow down your audience
If you’re struggling to create a clear product vision, the problem might be your target audience. It could be too broad.
Especially if you’re bootstrapping your startup, it’s a good idea to narrow down your audience. You’ll have a better chance of pleasing and winning over a narrowly-defined audience than a broad one. As your startup gains traction, you can always widen your approach and add additional features to cater to other users’ needs.
But initially, keep things specific. Try narrowing down the geographical region, targeting just one industry, or redefining your ideal user role.
2. Prioritize your desired lifestyle and company culture
It’s also a good idea to consider your desired lifestyle when coming up with your product strategy and vision.
Do you want to answer to investors? Or would you rather make a few hundred thousand dollars a year in annual profit without worrying about scaling too much?
Do you want to create a company culture that does everything it can to satisfy one target audience or a culture that’s constantly looking for expansion opportunities?
These types of questions will help you figure out the true vision for your product.
And of course, you can change your mind as you go along. Just make sure that you make a grounded decision and document it.
3. Revisit your product vision quarterly
Many companies focus on validating their product and clarifying their vision in the early days, only to operate on assumptions later on. This is a big mistake. If you want your business to remain profitable, you need to continuously update your product vision.
You can do by revisiting your 1-Page SaaS Blueprint.
On a quarterly basis, update the following sections:
Unfair advantages
Funding plan or runway calculation
Target users
Problem statement
Solution statement
Competitor list
Pilar features
At DevSquad, we also recommend that entrepreneurs use a dual-track agile development process. We run discovery sprints concurrently with delivery sprints so that every new idea is validated before it’s approved and added to the roadmap. We can use your product vision to guide the discovery process, so that only new features that align with your vision are considered.
As a small software company, this distinction is essential. You don’t want to work with a development team that will build any feature you think of or anything that customers request. You want to work with a team that knows how to take all factors into consideration, so that you’re building a product with long-term competitive advantages—as well as one that is feasible to support and maintain.
At DevSquad, you bring your vision and market expertise and we do the rest. We offer end-to-end product development, from executive strategy through deployment and testing.
Learn more about our process for bringing digital products to life. Or, sign up for the 1-Page SaaS Blueprint Challenge to document your own business plan and product vision.
