The concept of Iteration is that large problems can be broken down into pieces and solved incrementally through a process of progressive iteration.
They key here is that the elements of a solution don't have to be solved before starting to solve a problem.
You just start one a piece that can be defined, knowing that the solution that will be initially created will be inherently flawed.
But that's okay, because there is then the opportunity to do it it again, but this time with a much better understanding of what the solution should look like.
Key to rapid iteration is Collaboration