Proof of Concept (POC)

Reviewed by: Richard Becker
Last Updated: August 14, 2020

Definition - What does Proof of Concept (POC) mean?

A proof of concept (POC) is a demonstration to verify that certain concepts or theories have the potential for real-world application. In a nutshell, a POC represents the evidence demonstrating that a project or product is feasible and worthy enough to justify the expenses needed to support and develop it.

POC is therefore a prototype that is designed to determine feasibility, but does not represent deliverables. It is usually required by investors who need tangible proof that a startup and its business proposal can guarantee a healthy return on investment (ROI).

Project managers use POCs to identify gaps in processes that might prevent the product from achieving success.

Proof of concept is also known as proof of principle.

Techopedia explains Proof of Concept (POC)

A proof of concept process usually requires documentation that explains how the project will be carried out, the criteria that should be met to achieve success, as well as their evaluation, and long-term plan that explains the next steps if the POC proves to be successful.

Proof of concept is a term with various interpretations in different areas and industries. For example, it is used in the pharmaceutical industry to demonstrate that a new drug or medical device is promising enough to conduct more extensive tests about its safety and effectiveness in human patients.

Proof-of-concept short films are also used in filmmaking to explore the possibility of using new untested techniques that are particularly challenging or expensive.

Proof of Concept in Software Development

POC in software development describes distinct processes with different objectives and participant roles. POC may also refer to partial solutions involving 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.

Proof of Concept in Business Development

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 the examination of the revenue model, in which companies show projected revenue from products and services, and indicate development cost, long-term financial projections and how much the service costs to maintain and market.

It is an excellent way for a business to evaluate itself internally and for proposed acquisitions and projects.

Proof of Concept Vs. Prototypes

A proof of concept is not a prototype, although the two concepts share common ground. A POC is usually tested before a fully functional prototype is developed, and is needed to show that the idea works in practice.

It is a test that verifies the robustness of the idea itself and explores the validity of the concept from a theoretical point of view. A prototype, on the other hand, is a working model of the product itself that shows how it functions and its technical details.

A POC explains that a product can be made and can be profitable, while a prototype shows how it works and how it’s built.

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