What is an MVP?
You need a hammer to nail but ever wondered how it all started? Ever heard of Hammerstone, because that was the first ever hammer created. A blunt rock tied tightly at the end of a stick, that was it. So if we consider the hammers we use as the final product, then the hammerstone will be the MVP.
The design has changed over time but the end result is the same, nailing. This is what an MVP is. It provides proof of concept. Above that, it also helps you understand the market demands and the target audience.
MVPs are the way to bag an investor, but there is also a cost to build an MVP. This cost depends on some factors, and by knowing them, you will be able to trim off unnecessary expenditure and lower the MVP development cost.
Planning your budget is the best way to avoid a budget crisis. This blog will discuss the factors that affect the cost to build an MVP and give you a rough idea of the overall MVP development cost.
90% of the startups fail before completing a year. Only one in ten survives. The reason is the lack of market demand. MVP is the best way to know it.
By building a Minimum Viable Product, you will be able to strike the unwanted features of the product, understand the need of your target audience and the demand for your product in the marketplace.
You can release your product to the market faster and simpler, with the necessary MVP features to meet customers' needs. You will save time and test the market and improve your product to reach product-market fit.
Though not as costly as developing a fully-fledged product, developing an MVP isn’t something everyone can manage with their savings. You have to fund it with the help of an investor or some other way. And before you can go into any of that, you should have a clear idea of the MVP budget and where you will be spending it.
Running out of money during the development process is considered one of the top reasons for product/startup failure. So, we advise that you always plan your budget before you start spending it.
Before we go into the cost to build an MVP, let us look into the factors affecting the MVP development cost.
While hiring your development team, you should also consider hiring a feasible team within your range.
There are three ways you can develop your MVP:
- Building an In-house development team
- Hiring freelancers
- Outsourcing to trustworthy developers
Building an In-house team
This is rather a costly and risky way when considering your MVP development.
You will lose time, resources and money just to hire the team. And not to mention the fact that your budget has slimmed even before the start of the development process.
You have to fill positions like front-end developer, back-end developer, designers, etc. And once you hire the team, you have to consider the expenses like monthly salary, taxes, office rent, tech equipment for developing, etc.
You can choose an in-house development team if that’s suitable for you. But it will only spike the cost to build your MVP.
Freelancers are the cheapest option to develop an MVP. You can search for them through sites like Freelancers, Fiverr, Upwork, etc., and find the right developers for you, but there is a catch. They can give away the work if they find it tough or too challenging.
Imagine losing your hired developer halfway through, and you will be back to square one. And to manage these freelancers, you will practically become a project manager, constantly communicating and coordinating with freelancers, killing your time and exhausting your resources.
So, if you are thinking of hiring a freelancer, we suggest that you look for someone experienced. Try contacting your connections and see if they recommend someone. Because if they are suggesting someone, it means you have a minimum guarantee that you can finish the product.
Outsourcing your development
A feasible and widely followed way to build a minimum viable product is to outsource your project to companies specialised in MVP development.
Why? Because the companies:
- Have prior experience in developing MVPs.
- Share their expertise to build a better MVP from the go.
- Will have proper team management to ensure the product’s delivery on time.
- Charge a reasonable amount.
Your job will be to find a trustworthy outsourcing company. For that, you can start by looking into their websites, the services they provide and the case studies. Survey the reviews of their previous customers and understand their field of expertise.
Another option is for you to test their expertise. Give them simple tasks to showcase their expertise in the industry.
Read in detail: How to Hire App Developers to Develop Your Startup Idea?
It’s as the heading implies. The more complex your MVP, the more will be the time taken, increasing the development cost.
It will take longer for developing an MVP app of a food delivery service or an enterprise-level app than to make an MVP app of a photo-sharing platform. The more complex it becomes, the more will be the resources and time needed to complete the development, thereby increasing the MVP development cost.
Depending on the complexity, you have to consider the tech stacks required for the MVP software development. This ranges from programming languages to any technologies you need to implement a specific feature. Moreover, you will have to hire developers experienced in handling the technologies you need.
4. MVP Design
Though your MVP need not be visually appealing, it should provide an impeccable user experience. And for that, you need a spotless user interface in place. Be it a website or mobile app your initial customers should be able to navigate through your product.
This is a time-consuming process unless you have an experienced technical partner/team at your side to develop.
There are mainly three steps in MVP design:
- Create a wireframe: This is to better understand the product's layout, how each feature is linked, etc.
- UX design: Iterating the best design for a better user experience.
- MVP Mockup: A mockup is where the wireframe is used as a guide to outlining how the end product should look or will look.
5. MVP Features
Provide a great user experience and successfully solve the pain points of your target audience. Including only the essential features will help reduce the time for the design and development of the MVP. It can bring down your MVP development cost. As the number of features you add increases, so will the cost to build an MVP.
You can read more about prioritising the MVP features here.
By now, you have understood that there is no fixed budget for MVP. The MVP development cost depends on several factors. And also, you can’t rule out the post-launch costs like:
- Marketing & advertising
Marketing is another factor that can spike your MVP cost. At the initial stages for MVPs, partnering with a digital marketing agency would be the best option. The cost will depend upon the type of marketing you want. This includes, but is not limited to, social media marketing, search engine marketing, paid campaigns, etc.
Through them, market your product on social media platforms and events where your target audiences are more active. The costs will vary depending on the services you select and, consequently, the MVP pricing. Understand the best strategies to market your app. It can help you stand out and reach the right audience.
Implementing a proper sales funnel is important while launching an MVP. You have to find the proper sales channels and platforms to launch. It’s another way to target your potential customers and increase the MVP budget.
Launching the MVP isn’t the end; you will have to provide proper support and maintenance if any issues arise. And since it’s an MVP, there will be a feedback loop in place to improve the product. So, this is yet another factor your MVP development cost depends on.
The factors like the tech stack and complexity of the MVP will play a key role in determining the level of maintenance required.
You have read about the factors that affect MVP development cost. And out of it, it’s the development team that primarily determines the cost to build your MVP.
The optimal range for those selected freelancers for developing falls between $9000 - $15000. More depending on the features and complexity of the product.
It will cost you from $25,000 and above for an In-house team. But don’t forget the monthly salaries, the insurance, taxes, etc. This means if you are creating something like a website, a one-time project, you will find no use for your development team after work. And you will be forced to either pay them monthly or relieve them.
And for outsourcing, mostly, the companies charge per hour for the work. This hourly rate ranges from $35 - $250, depending upon the location of your development team. The cost of living and resources does play a crucial role here. That is why more and more companies choose to outsource their product development to Indian companies.
Depending on the factors we discussed earlier, the cost varies. The more time you take, the more expensive your MVP development cost will be. Typically, it takes a month or two to build a minimum viable product, and the average price range for an MVP development project falls between $10,000 - $15,000.
While there is no fixed range of costs to develop an MVP, it is better for you to outsource your MVP development. The outsourcing companies are feasible, experienced, and can even help you choose the necessary features of your MVP.
Whether you decide to freelance or outsource MVP development or build an in-house team for it, you have to effectively communicate with them about your product idea and vision. Give them a clear and concise idea of what your end product will look like and the problem it solves. Proper communication will strike away all the doubts and unwanted pitstops during the development phase.
Looking to build your MVP? Contact us to get a free consultation and get a precise idea of your MVP project, the development time needed, the tech stacks required, etc., to finalise the cost to develop your MVP.