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How much does it cost to build MVP in 2024. UPD

2 out of 10 startups go bust within a year. The reasons can vary: from the lack of market demand and budget to problems within the team.

How do you build a relevant product that meets customers’ needs, stays up to industry standards, and stands out from the competition? The answer lies in the MVP approach. In this article, explore how to calculate your MVP development cost and set your startup on the right path. Let’s go!

Reading time: 13 minutes

Table of contents

Key takeaways

  • MVP is a strategic approach to launching a product to the market. The idea is to start with a simplified version of your app with must-have features to test the idea and explore customer needs.
  • MVP development price can vary due to factors such as scope, choice of the team, hourly rates, location, developer qualifications, and contract type.
  • MVP includes the discovery stage, prototyping and design, app development, quality assurance, and optimization.
  • MVP development costs from $24,000 to $96,000, and the average time-to-market is 4-5 months.
  • Post-launch services include marketing optimization, scalingup, and technical maintenance.

What is MVP 

To get on the same page about costs, let’s cover the bases first and discuss what MVP means, the types of MVP you can develop, and what advantages it can bring to your startup. Then, we can talk about money.

The term MVP, or minimum viable product, was coined by Frank Robinson in 2001, and popularized by Eric Ries through his book Lean Startup. Since then, MVP has become a standard for high-performing product teams all over the world. 

In a nutshell, MVP is a strategic approach where you create a simplified version of your product with only the core features needed to solve a specific problem or meet a particular need. 

The main objective of an MVP is to address vital inquiries and collect input from actual users. These inquiries might encompass the following:

  • Is there an authentic requirement or desire for the product or service?
  • Will users actively use and benefit from the offer?
  • Are the suppositions about user actions and inclinations correct?
  • Is it feasible to develop the product using the current resources and technology?
When you focus on essentials, MVP development allows you to efficiently test your idea in the real world, gather user feedback, and make data-driven decisions to refine and improve your product.

The risk of investing time and resources in features that may not resonate with your target audience is minimized through this iterative process.

READ MORE  Why MVP software development is so important for projects

5 advantages of successful MVP development

Is MVP worth spending money on? Let’s talk about 5 advantages that this approach can bring to your startup.

1. Risk mitigation

The MVP approach is about testing the waters. If you focus on core functionality, you reduce the risk of investing in a full-blown idea that can potentially fail. 

2. Faster time to market

Speed is often the name of the game. When you build an MVP, the development goes faster because you focus on essentials. You can get a basic version of your product to market sooner and gain an early foothold in the marketplace.

3. Cost-efficiency

It can be expensive to build a feature-rich product from scratch. The MVP approach is ideal for startups and small businesses with tight budgets, helping them manage expenses wisely. In fact, CB Insights reports that 44% of businesses fail due to running out of money. 

4. User-centric approach

MVP puts your users first. If you are attentive to their wants and needs, you provide real value with your product. This user-centric approach not only drives success but also fosters stronger customer relationships.

5. Iterative improvement

MVP isn’t a one-time event. It allows you to gather user feedback, identify areas for improvement, and continually refine your product. This iterative process keeps your product in sync with changing market dynamics and user preferences.

In summary, a company can benefit from the MVP concept in a number of ways. 

MVP helps product owners prioritize core features, speed up time-to-market, save money, and focus on continual improvement. 

By taking advantage of these benefits, companies can increase their chances of success and adapt to the changing needs of their users and the market.

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Examples of successful MVPs

Many big players started with simple minimum viable products and honed their concept into popular and habit-forming solutions. Let’s look at 3 examples of good MVPs that turned into market-leading companies.

X (ex-Twitter)

The old and new logo of Twitter/X

New Twitter (X) logo

Twitter began its journey in 2006 as an experiment within Odeo, a podcast company. Developers led by Jack Dorsey created “Twttr,” an internal MVP version of a platform for sending 140-character messages to other employees and viewing them on a group level. After the initial internal testing, Twitter was released to the public on July 15, 2006

Twitter benefited from the MVP approach and used an iterative development process, which allowed it to adapt to user feedback and needs. This minimalist concept later became Twitter, as we know it now, and revolutionized social media.

In 2017, Twitter doubled its character limit to 280 to accommodate evolving communication needs. In 2023, Twitter announced a rebranding and unveiled “X” as the new identity, symbolizing another chapter in the company’s ever-evolving history.

Uber

Easy to recognize Uber logo

Uber logo

The story of Uber is a prime example of how simple MVP software can spark a transformative revolution. The founders of the ride-sharing app, Travis Kalanick, and Garrett Camp, noticed a significant problem with public transport in San Francisco and came up with an idea. In 2010, they initially created UberCab, a simple app that allowed them to hail a black car in the area. 

MVP approach allowed them to test the concept and gather user feedback. Over time, they expanded and refined the service based on this feedback, leading to the global success of Uber as we know it today. 

The MVP approach helped Uber validate the demand for such a service and refine their business model efficiently. The company fundamentally changed the way people navigate cities. With an easy-to-use smartphone app, users could easily hail a ride from point A to point B.

Dropbox

Dropbox as an example of MVP

Dropbox logo

Drew Houston, the founder of Dropbox, came up with the idea when he forgot his USB drive with important files. He created a simple MVP in 2007, a basic file synchronization and sharing service. 

The initial concept was elegantly simple, yet highly effective: allow users to effortlessly store and share files across devices. This concept addressed a major pain point in the digital age — the need for seamless access to files across platforms and locations. 

This MVP allowed him to test the concept with friends and early users. Positive feedback and demand encouraged further development, and Dropbox evolved into the cloud storage giant it is today.

Because of the MVP approach, Houston validated his idea and scaled the service effectively. For its MVP software, Dropbox focused on iterative development. Early adopters quickly saw the value in the service, and their input was actively solicited and incorporated into subsequent updates. This user-centric outlook allowed Dropbox to evolve from a simple file-sharing platform to one of the most widely used and trusted cloud storage services in the world.

How MVP development cost is determined

Average MVP development price is usually around $76,000. Usually, the biggest chunk of it is hours of developers’ work.

But sometimes, it can be unclear what else is added to the MVP app development cost and how you can cut potential expenses to stay within your budget. 

Various factors can impact the final price: from the scope of work to the selection of development teams and the evaluation of developer skills.

To help you navigate MVP development costs, let’s discuss the primary elements that determine the price and understand how the costs are calculated.

5 factors that impact MVP development price

Here is a list of 5 factors that impact the final price and added examples of how you can control it.

Core functionality

⬆️ Increase: Complex features

⬇️ Decrease: Streamlined features

The cornerstone of any MVP lies in its core functionality. MVPs prioritize the primary solution or feature that directly addresses a specific problem or fulfills a particular requirement. By keeping your focus on this core aspect, you not only streamline development but also control costs effectively.

User interface

⬆️ Increase: Elaborate design elements

⬇️ Decrease: Minimalist and simple UI

An intuitive and straightforward user interface is key to MVP success. It places the emphasis on ease of use, with a conscious decision to prioritize essential features over intricate design. This approach ensures that you’re investing resources where it matters most, eliminating unnecessary complexities that might inflate your budget.

Volume of content or data

⬆️ Increase: Extensive data integration

⬇️ Decrease: Reduced data scope

MVPs are all about minimalism. In this context, less is indeed more. When you include only a minimal amount of content or data, you underline the importance of core functionality. This not only saves costs but also speeds up the development process.

Feedback collection

⬆️ Increase: Advanced feedback analytics

⬇️ Decrease: Basic and accessible forms

Collecting valuable user feedback is crucial to the MVP journey. Tools such as surveys or contact forms are a cost-effective way to gather input from your early adopters. This not only helps with product refinement but also fosters a strong, iterative development approach.

Performance and stability

⬆️ Increase: Extensive optimization

⬇️ Decrease: Basic stability focus

MVPs are designed to provide stable performance, although they are not fully optimized like a finished product. This balancing act between performance and cost efficiency is a critical factor. Focusing on stability ensures that your MVP is functional and reliable, without the additional costs associated with extensive optimization.

How to keep your MVP within the budget

Here are 5 tips on how you can reduce cost of MVP development when you outsource the project without risking the quality of the final result:

Tip 1. Comprehend the scope of work

The scope of your MVP sets the stage for cost estimation. The broader the scope, the higher the development costs are likely to be. For example, do you want a mobile app, a desktop app, or a web app? The key to keeping MVP development costs in check is to prioritize essential features.

Tip 2. Choose between in-house and outsourced development teams

In-house teams often have higher operating costs, including salaries, benefits, and infrastructure. In contrast, outsourcing software development companies can provide cost savings. You pay for the specific services you need, without the burden of ongoing overheads.

Tip 3. Examine hourly rates in MVP development

Hourly rates differ among software developers. Experienced developers may charge more per hour, but they often complete work faster and with greater quality. When choosing a development team, it’s important to find a balance between cost and expertise.

Tip 4. Consider geographical location

The location of your development team can affect how much their work costs. If your team is in an area where the cost of living is lower, you might be able to hire developers for less money. But it’s important to think about potential issues, like language barriers, time zone differences, and remote work challenges.

Tip 5. Analyze contract types

Development teams usually offer 2 types of contracts: T&M and fixed-price.

T&M, or time & materials, is based on the number of hours a developer spends on a project (according to a pre-arranged hourly rate). These contracts offer greater adaptability but may be less predictable in terms of final costs. 

A fixed price contract is when you pay for a given product to be built in a given time for a given amount of money. It provides cost predictability but may limit flexibility for project changes.

Memo for MVP budgeting

To help you remember what factors impact the cost of MVP and how, we put together a short memo with the most important details.

Factor ⬇️Lower cost ⬆️Higher cost
The number of features Prioritizing essential features. Fewer features = Fewer paid hours of developers Broader scope of MVP. Additional features = More development work and more paid hours
Development team

 

Outsourcing development. Opportunity to avoid spending money on training and management In-house development teams. Potentially higher salaries, benefits, bonuses and taxes
Hourly rates Lower hourly rates. More offers from teams worldwide and competitive rates Hiring experienced developers. Higher hourly rates
Geographical location Lower cost of living area. Collaboration with teams from lower-cost locations High-cost geographical location. Inflated cost of labor, office space, and other operational overheads 
Contract type Time and materials contracts. Pay as the work gets done and adjust your budget during the process Fixed-price contracts. Expensive adjustments in case of unforeseen challenges

How long does it take to develop an MVP

On average, it takes 4-5 months to build an MVP. However, each case is unique, and the estimation can change in different situations.

At Purrweb we know how sensitive time is. That is why the average time to deliver an MVP for us is 4 months. Throughout the process, the project manager will inform you of all the project updates.

4 stages of MVP development

Let’s take a look at the 4 most important stages of any MVP and break down costs, timeframe, and scope for all of them.

1. Discovery

Time: 1 to 2 weeks

💰Cost: from $1,800 to $3,600, depends on the depth of research and analysis required.

The discovery phase is the starting point of your MVP journey and sets the stage for everything that follows. Here you define project goals, conduct market research, and outline the scope of the MVP, while we create user stories and help you make tough decisions about which features to prioritize. Also, we assess technical feasibility and estimate the initial budget. 

The discovery phase provides a strategic blueprint that not only reduces the risk of costly missteps but also increases the chance of success: an MVP that meets user needs and business goals. 

At Purrweb, we take the discovery stage as an opportunity to align your expectations with the market standards and technical possibilities. Imagine this: to stay within the desired MVP price, you have to give up some of the features of the product. We’ll help you take a look at competitors, decide what your customer needs the most, and how we can save you money.

2. Design and prototyping

Time: 2 to 4 weeks

💰Cost: from $2,400 to $4,800

This step is similar to a blank canvas, where we sketch the basis of the MVP. Our designers carefully develop wireframes and mockups for the best user experience.

The example of wireframes

That’s how wireframes look

The design and prototyping phase transforms an MVP concept into tangible, development-ready designs. This is not just about aesthetics. It is about creating a user-focused MVP that not only looks good but also appeals to the intended audience emotionally and intellectually.

Besides performance, the MVP design also takes a prominent role. Here is where we create a consistent brand image and carefully design the user interface. We pay attention to every detail, including colors and fonts, to create a professional and memorable look that connects with users.

During this phase, usability testing is essential to keep our focus on the user. We have real users test the prototype and provide invaluable feedback that helps us continuously improve. User feedback helps guide the design process to make the MVP more intuitive and usable.

And that’s how the final design may look

3. MVP development

Time: 2 to 3 months

💰Cost: from $24,000 to $96,000

During the product development process, we write code and implement it. This is where the actual building of your MVP takes place.

First, the development team will create a clear roadmap and gather all the necessary requirements for the MVP. Then, they’ll start coding according to the project plan, using the chosen programming language and development tools.

At Purrweb, developers will work in sprints, breaking down tasks into smaller, manageable units. They will collaborate closely to ensure the code integrates smoothly. Regular testing is essential to catch and fix any bugs or issues as they arise.

As the code is implemented, continuous integration and version control are key to maintaining code quality and tracking changes effectively. Once this phase is complete and tested thoroughly, it can be integrated into the MVP, and the product will take shape.

This stage demands a high level of precision and teamwork to ensure the MVP functions as intended. Frequent communication and collaboration among team members are essential to meet development goals efficiently.
READ MORE  Why MVP software development is so important for projects

4. Quality assurance and optimization

Time: 2 to 4 weeks

💰Cost: from $4,800 to $19,200

As your MVP project approaches its final stages, the quality assurance (QA) and optimization phase take center stage. This phase is critical to ensure that the MVP goes smoothly and meets and exceeds user expectations. The cost of QA and optimization can vary significantly, and depend on the scope and complexity of your MVP project.

During the MVP test phase, thorough tests are conducted to uncover and resolve any glitches, bugs, or potential issues that could hinder the user experience. This careful process ensures that your product will function seamlessly upon release and maintain user satisfaction. 

On the other hand, optimization is the fine-tuning of the MVP to improve its performance, responsiveness, and overall user experience. It’s an investment that not only safeguards your MVP against potential hiccups but also guarantees the delivery of a polished product that leaves a lasting, positive impression on users.

Let’s start developing your MVP today!
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MVP post-launch support and costs

The next stage  after the product development is the post-launch phase. Even though the product is launched, it doesn’t mean you get to take it easy from there. If you want your app to succeed, follow these steps after the MVP development process.

Marketing and promotion

Now it’s time to choose a marketing partner to advertise your app on different platforms and attract users. There are a number of ways to do it. Trust in the judgment of your chosen experts, but keep an eye on the money, since marketing can expand and bloat your budget. One of the most effective and economical ways is inbound marketing: active social media presence, blog posts, and email newsletters.

Sales efforts and revenue generation

You need  a strategy to roll out the product and let the audience appreciate your app. The software development company helps the customers test the idea and determine the right sales funnel. This is where you employ data metrics like daily active users, churn rate, and retention rates. Going on a gut feeling is dangerous — sales is the final, income-generating step. Fail here and everything will have been for nothing .

Maintenance and sustaining the MVP

The maintenance of the project takes about 20% of the MVP budget. The final cost depends on the product’s complexity. For investors, it doesn’t matter how intricate your MVP is if it’s bug-ridden. Moreover, it is a necessary step that’ll help you to gain user feedback and evolve your app.

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Our successful MVP project

In our efforts to make a meditation app similar to Headspace, we made a solid meditation app in just 5 months. We concentrated on making a basic product that would quickly become available while also catering to the needs of our users. Detailed planning and execution were essential to this process, and we discovered valuable lessons during our journey.

We did extensive research to learn about what meditation users want and what they find difficult. We used this knowledge to choose the most important features for our product, so it solves common meditation problems. Furthermore, we always included user feedback in our development process to make sure the product meets our target audience’s needs.

The interface of a medication app

The interface of this meditation app

Effective project management and smooth team collaboration were crucial to our success. We aligned team members, set clear objectives, and employed efficient project management practices in order to meet our ambitious 5-month timeline. 

We embraced agile development methods and it allowed us to adapt to changing requirements and refine our product repeatedly. This case study shows how new businesses can effectively compete with established industry leaders by using strategic MVP development, prioritizing user-centered design, and efficient project management techniques.

READ MORE  An app for COVID-19 second wave: how we built a competitor to Headspace in 5 months

Conclusion

Through the MVP strategy, startup owners can present an app idea to investors and potential customers, and gain crucial feedback on how to improve and monetize the solution.

If you need to test your idea effectively and engage with a potential client base, you can consider hiring established MVP development firms. These experts work with startups to help them save time searching for developers, putting teams together from scratch, or dealing with legal issues. At Purrweb, we can take care of the job for you.

Need an estimation for your MVP idea? Contact us to receive a free consultation with our experts.

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FAQ s

  • Why do I need to make an MVP?

    MVP is a great idea if you want to test your idea and collect feedback from real users. It allows you to enter the market with a working product and gradually add necessary features.

  • How much does MVP cost?

    MVP cost depends on the complexity of the app. MVP has only necessary features and needs less cost but it's a fully working product anyway. The average MVP cost is $76,325.