Factors Determining the Cost to Build a Minimum Viable Product

WHAT FACTORS CAN INFLUENCE THE MVP PRICING?

TYPES OF MVPS

There are three basic types of minimum viable products.

1. A prototype

This is the very first thing that appears after you decide to create a product. Something to begin with. A prototype is an interactive mockup that shows how your future app would work. It’s not for the market launch purpose. But it does give an understanding of what kind of product is in your mind and whether it’s worth funding.

A prototype can be used mainly for pitching and to test your business idea against real demand. Instead of spending lots of money (that you might actually not yet have) on the grand full-featured app, you can use a simple interactive mockup. This can help you gain feedback from the potential users, as well as persuade investors to fund you. Or you can show it to the developers and discuss possible tech solutions for your idea. The prototype pricing starts from “do it yourself for free” to $5,000 depending on the project complexity.

2. A minimum viable product (MVP)

This one is way more complicated. This is a version of your product that contains the core features. No frills. Just the basic functionality required for the app to actually work. Your MVP is already a tool that people can use. Hence, it gives you valuable customer feedback earlier. Instead of a theoretical business hypothesis, you get to know what real users say. You can make important decisions on what to do next with your app: what features to add or remove, what funds you need for that, etc. Or you might see if your target audience was chosen correctly.

IT-specialists almost unanimously agree that it’s better to start with an MVP than to build a full-featured product at once. MVPs do not have any complex things that take months to develop. You have a simple working product you can launch right away. The minimum viable product pricing starts from about $10,000.

3. THE FIRST VERSION OF THE PRODUCT

If your MVP proved to be successful and you have your first users, you add the desired features and release the first product's version. It’s not perfect yet. But that’s ok. The product will gradually become more sophisticated. And you can improve it according to the user needs. So, how much does an MVP cost? The price for this kind of minimum viable product may start from $40,000.

Sometimes it’s rather complicated to choose what to do. For example, whether you need a prototype or you can switch directly to MVP. Especially if your funds are limited. Give us a call and we can advise you on this. You may also find one more of our articles useful, which reveals the difference between MVP vs EVP.

DEVELOPMENT TEAM

Three most obvious options are hiring a freelancer, an in-house pro, or taking a software development company as a contractor. Each option has its advantages and flaws. Let’s get a deeper look at every one of them.

1. FREELANCERS 

PROS

• This might be the cheapest option.
• You can speak with your developers personally and control everything.

CONS

• Some freelancers find it hard to keep terms.
• The budget may increase with the process.
• If something happens to your only one developer, the whole process is stuck.
• The danger of low-quality code is the highest.

2. IN-HOUSE DEVELOPERS

PROS

• You can choose them yourself.
• You are able to build a hand-picked team.
• They are close to you most of the day.

CONS

• Additional costs for office and overall administration.
• If the project is not successful the whole effort goes in vain.

3. A SOFTWARE DEVELOPMENT TEAM THAT HAS MVP EXPERIENCE

PROS

• They are professionals. They know what to do, when and why.
• You have access to their expertise. They really help you to make those complex choices on tech stack, functionality, etc.
• Minimum tech-related risks. You can focus on promoting our app for example and other business and marketing issues.
• Professional management ensures the smooth workflow which saves you both time and money.

CONS

• If a team has highly experienced professionals, it may seem more expensive than previous options. But that's because prices for freelance and in-house specialists start from the "inexperienced" level, and that creates the contrast.

Read our article to learn how to build a minimum viable product.

TECHNOLOGY STACK

Here we come to one of the most crucial points. What technology or platform to choose? You should bear in mind that different technologies are used for different purposes. For example, for Android mobile app you would mostly use Java or Kotlin. For iOS – Objective-C or Swift. For e-commerce projects, one might opt for Magenta. If your project requires Data Science – select Python.

What also influences the price is that there are native and hybrid solutions. Native technology is made for a particular platform. Like Swift for iOS, Java for Android, .NET for Windows etc. A native stack is more complicated both to learn and to use. But it gives better quality in the end. The hybrid stack uses various ready-made web solutions and some part of a native stack. Thus it is faster and easier to use. Hence there’s a huge difference in prices.

Software developers usually charge an hourly rate. It also depends upon the complexity of technology. And sometimes geography.

If you feel lost in this variety and need professional advice, just talk to us. We can help you find what you are looking for and make the optimum choice for technology stack.

MVP KEY FEATURES

The features you add to a product determine how long it takes to develop it and what resources it takes to develop it.

Your MVP should not include fancy features. Since the purpose of an MVP is to show the core value of your product, you must prioritize the components that need to be included. Also, you should not do too complicated UI/UX at the start. Only if design doesn't play a key role in your case. It is also worth thinking about cross-platform and the need to integrate third-party services. All this significantly affects the MVP app development cost.

POST-LAUNCH MVP DEVELOPMENT COST

After you launch an MVP to the market, you will need additional budget to evaluate and promote your product. Here are the activities you will need: 

RECEIVING FEEDBACK

Getting feedback from users will tell you whether to continue on the road you are on or turn around and change direction. For this purpose, you can use social networks, email newsletters and surveys.

USE OF ANALYTICS

Statistics allow you to get a deeper understanding of your users and their behavior and provide you with a lot of data that is not usually obtained directly from user feedback (for example, geolocation, referral websites, visits over time, page views, actions, etc.). To do this, you will need to use various analytical tools that can be connected to your application.

USER TESTING

This method exposes hidden usage flaws and lets you hear exactly what your audience wants so you can make changes and improve your app.

MARKETING ACTIVITIES

Of course, to promote your product among the target audience, you will need marketing and advertising. It all depends on the possibilities of your budget. You can surround yourself with a whole arsenal of activities like blogging, social media promotion, email newsletters, native advertising, PR, etc.

TOP 5 TIPS TO CUT EXPENSES AND TIMELINE

GO WITH CROSS-PLATFORM DEVELOPMENT

When developing native apps, software developers must write two separate codebases for each platform, iOS or Android. With cross-platform development, they create only one app that runs on both.

USE CI and CD

Continuous Integration (CI) and Continuous Deployment (CD) will reduce cost to create an MVP while maintaining product quality. As a result, the use of CI and CD improves software quality, reduces time-to-market, and reduces average costs of an mvp development.

START TESTING ASAP

Regular testing will improve the development cycle and also reduce cost to develop an MVP.

CHOOSE A RELIABLE DEVELOPMENT TEAM

The team with which you will have a perfect match is in many ways the key to the success of your future product. Therefore, approach the choice of a partner very carefully. Make a list of suitable companies, study reviews on industry resources, evaluate portfolios. Try to conduct enough interviews to learn all about the team's expertise, processes, and communication methods.

DEFINE GOALS AND REQUIRED FEATURES

You need to have a well thought out product vision and business model as this will help you in setting achievable goals. Misunderstanding the characteristics of an MVP can cost you a lot of money. Therefore, you must be sure of the core features.

SO, HOW DO YOU FINALLY CALCULATE THE MINIMUM VIABLE PRODUCT PRICE?

When you hire a freelancer or an in-house team, the formula is the following: the number of people you need multiplied by hourly rate number multiplied by of hours required. But you take all the pros and cons into account.

For a 1 month project, MVP cost calculator might look like this: 1 developer x $30 hourly rate x 160 (8 hours per 20 working days) = $4,800

If you partner with an experienced software development company, ask them to estimate the cost based on your requirements. Get a quote from them. Then you receive the actual amount for your purposes as well as time estimation.

CONSIDER GEARHEART YOUR TRUSTED PARTNER

Many of our startup clients have already received considerable funds with the MVPs we developed. The Gearheart software development company works only with experienced developers. We focus on what is really important for the client, set out core functionality, and get the first MVP in two weeks after the inquiry. You can check more information on MVP development services in our Projects. We will be happy to work with you on your project or provide you with our advice.