How Much Does It Cost to Build an MVP?
Imagine that you’ve started a business, and you need to present your product to the world. It seems that everyone would want to create a perfect product right from the start. But it is also important to take into account the potential challenges of this approach. Firstly, it is impossible to make a flawless product without having it tested with real customers. Secondly, there are always risks — it might be not exactly what your customers are looking for. Thirdly, you don’t want to spend much in vain, right? Save your efforts and costs with an MVP.
What is an MVP and why do you need it?
When you start a business or a new direction in your company and want to connect with your potential users or customers, you don’t need to go all the way building a full-scale product at once. It is usually enough to develop a minimum viable product (MVP) to test your hypotheses about how the business idea of yours will work.
MVP is referred to as a working product that contains minimum features needed for gathering validated learning about how the product should be further developed to become commercially successful.
An MVP can be a mobile app, a website, set of features or part of an application. This concept comes really handy for startup companies, which are often forced to be particularly money-wary. However, it is also perfect for mature businesses which know better than to go on a wild spending spree.
What are the pros and cons of the MVP approach?
First of all, it is much faster than building the whole product. Therefore, you will start getting validated learning much earlier, which might prevent you from making critical mistakes and spending your time on the features that your target audience really doesn’t need. However, keep in mind that MVP always has limited functionality and thus allows targeting only the less demanding group of your potential customers – the so-called early adopters.
The second benefit is its price. Then, there is always a risk that your product with a full range of features is not as successful as you hoped. In this case, you will need to make costly changes (in terms of time and money). An MVP allows you to try delivering your message to your specific audience and measuring its efficiency. If it works, you can always continue developing it and making further improvements, or invest into a more advanced product. If it doesn’t work, you will lose much less compared to the situation when you opted for a full-fledged product.
On the other hand, the MVP approach has certain explicit challenges. For example, it is very hard to define ‘minimum viability’ of each particular product. Excessive minimalism often does a disservice, since it fails to attract the number of users needed to gain the desired ‘validated learning’. In most cases, we should rather talk about ‘minimum lovable product’, or a product which your early adopters would truly wish to try.
The second limitation is that MVP approach does not work for certain industries. Banking, insurance, healthcare, to name a few. These sectors require particularly reliable software, because a small error might cost them millions of dollars or even a human life. They cannot afford testing ‘raw’ functionality. The definition of ‘minimum viable functionality’ for such industries will be quite close to your vision of the finished product.
So, when it comes to developing a minimum viable product for your business, the main question that arises is “How much does it cost to build an MVP?” How much money do you need to invest in order to get the attention of potential customers or even the first sales? Let us get straight to the main question here, “how much does it cost to make an MVP?” Generally, the average cost to develop a minimum viable product will depend on what you need and whom you hire.
MVP: your vision of the ‘minimum viable functionality’
No matter – whether you are a ‘mom and pop’ company with an ambitious startup, an established business with 100+ employees, or a huge company with an enterprise-level product, – the key factors affecting the cost of the MVP will be plus-minus the same.
- Platform and technologies. Web, mobile, desktop? Or will it be an autonomous or unique device which connects to other devices or to a smartphone or PC? If you plan to use rare or new programming languages, the cost of MVP development is likely to grow significantly.
- Which functionality is included into an MVP – is it simply a landing page or an application with several user roles/a video player or a game?
- Do you expect users to transfer payments from the first days of your product’s existence? Then of course the cost of an MVP will be higher, because adding payments requires extra time.
- Probably the most ambiguous part of your expenditures, because design is always a matter of taste and personal preferences. However, there is often an opportunity to use standard design with basic modifications, which you might wish to use to cut the budget a little bit. Because custom design implies more significant expenses.
- One of the major factors determining the cost of the MVP is how you build its creation and whom you hire. We will pay more attention to this factor in the next section.
So how much?
If you are tech-savvy, you can build your MVP on your own. It will be the cheapest way to set off with your business idea. For example, if your minimum viable product is a website, you will simply need to pay for the hosting, and the rest depends on the time you have. This is the least costly way, but it is the most time-consuming one, as you will need to do the development, management, and testing on your own. The total amount you will spend this way would start with $100. Plus your time and effort, of course.
If you want to secure yourself a good start, you can hire developers or local contractors who will build a custom MVP for you. This will be both costly and rather time-consuming, as you will need to pay the coders, designers, or other specialists, while managing the process by yourself. If you are launching the development in North America, Western Europe or Israel, the cost of your MVP will start from USD 30000. If the core employees get fixed payments or salaries according to their contracts, you will have to keep paying even when there is no actual work for them. On the other hand, it allows “securing” really bright talents for the creation of the full-fledged product.
You can outsource the development using freelancer websites, such as Upwork. These will be among the cheapest options that you have. In this case, you will spend a minimum of USD 5000. Still, you will have to rely on the reputation of your freelancer or their portfolio before you hire them. Even in this case, you often risk being left with a poor-quality product.
Best value for your money
The most effective solution will be to hire a software development agency that will find you the right people and provide end-to-end development of your MVP. They will be able to assemble a dedicated team specifically for your product and if necessary, provide project management, QA, design and UX expertise. What’s good, the development cost can be much lower than when you hire an on-site professional (or an entire team). The cost depends on the type of your MVP and technologies used. Based on our previous experience, it starts from around USD 8000.
In all cases of MVP development, please keep in mind that based on the results of beta-testing or focus groups, you will need to modify your MVP until the structure, design and functionality of the potential product are clarified. It will take additional time, and thus result in extra spending.
Contact us, and we will gladly provide you with MVP development pricing quotes. Act smart by letting the professional company assemble for you a team of the most suitable experts and manage the entire development process at an affordable price. You will need the money that you’ll save to bring your product to perfection.