To perform such tests, the software is made available to developers and potential customers. This process is also known as a beta release, and the individuals that contribute to it are called beta testers. A program may be released for testing to a limited number of invited testers (closed beta), or it can be made public to anyone interested (open beta).
As the name suggests, closed (or private) beta testing involves a smaller group of testers. This approach may be suitable for testing software that seeks to gather feedback from specific target demographics, or that cannot be tested on a wider scale due to scaling limitations. On the other hand, open beta testing usually involves a broad user base, which is often made of potential consumers. In this context, open beta may also be considered a marketing strategy with the goal to demonstrate the product.
So, the beta stage allows developers to make improvements and fix bugs before the product is good enough for the next stage (release). When a beta software is close to its final version, it is often called a “release candidate.” If no more problems or bugs arise, the program can be finally launched as a “stable release.”