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A proof of concept (POC) is a demonstration, the purpose of which is to verify that certain concepts or theories have the potential for real-world application. POC is therefore a prototype that is designed to determine feasibility, but does not represent deliverables.
Proof of concept is also known as proof of principle.
Proof of concept is a term with various interpretations in different areas. POC in software development describes distinct processes with different objectives and participant roles. POC may also refer to partial solutions involving a small number of users acting in business roles to establish whether a system satisfies certain requirements. The overall objective of POC is to find solutions to technical problems, such as how systems can be integrated or throughput can be achieved through a given configuration.
In the business world, POC is how startups demonstrate that a product is financially viable. POC involves extensive research and review, and is submitted as a single package to concerned parties. It includes examination of the revenue model, in which companies show projected revenue from products and services, and indicate development cost, long-term finance projections and how much the service costs to maintain and market. It is an excellent way for a business to evaluate itself internally and at proposed acquisitions and projects.