MVP (Minimum Viability Product) allows companies to do a realistic and real-time test of their idea before they launch the product. Consequently, the user feedback they receive enables them to make the required changes and invest only as much as required and in the right elements. Of course, building an MVP demands a considerable investment. But how significant is it? The cost depends on various factors. But as a company looking to build an MVP this blog can help you understand the cost of building one.
How Much Does It Cost to Develop an MVP and What Factors Drive it?
In its entirety, building an MVP can cost you as much as in the range of USD 20,000 – USD 130,000 – in some cases, even more. Factors like the idea's complexity, design, functionality, and the resources involved contribute to the MVP's cost. Let's review the reach of these factors to know about the cost involved in building an MVP.
Project Scope
Scope essentially involves the functionalities you would want your MVP to have. The MVP's features and functionalities determine how long the design and development process will take and the resources the project will require. These features would add to MVP's core value, make it workable and deliver value to your users.
Differentiating the primary functions will enable you to optimize the MVP's development cost. Consequently, the core functions help you test the product's primary idea and comprehend the target market's demand.
While working on the project scope, you must ensure that you do not include any ancillary features. The purpose of testing your idea with an MVP is to examine its core proposition. Adding non-essential features can add to the MVP cost. They may not necessarily help you garner the feedback you are looking for. Thus, testing an MVP with core features and functionalities proves more prudent and productive.
Development Resources
Another significant factor influencing the MVP's cost is the type of resources you select for the project. The three types of resources include in-house, remote and specialized.
- In-House Team
Hiring in-house resources could involve a significant amount of costs. It involves various costs like hiring, interviewing, training, onboarding, and paying salaries to the resources. The salary component will include factors like employee benefits and other administration costs. Besides, you will have to manage the project independently and every other responsibility you have on your plate.
- Freelancers or Remote Developers
This is a cost-effective approach. Freelancers usually cost much lesser than in-house employees. So, you save a lot of costs working with freelancers. But the potential problem with freelancers is reliability and availability. Most freelancers take up part-time MVP development gigs while handling their full-time jobs. Engaging with such resources can help save costs but increase the project's overall time. Let alone the effort involved in mobilizing a team of freelancers that will work coherently.
- Specialized
This is by far the most effective approach from various perspectives like cost, effort, reliability, maintaining confidentiality, and delivering value. While working with specialized MVP development companies relieves you from the efforts and costs involved in gathering resources, managing the project, and completing it on time. Besides, they follow the best MVP development practices and apply their intellect to deliver MVPs that help you derive your desired value.
Additionally, the developer's number of years of experience, portfolio diversity, past projects, and location also matters. For instance, hiring developers from developed countries can cost considerably more than developing ones like India.
Technology Stack
Technology is useful. But it comes with a cost. Hence, you must choose what is necessary at the MVP stage to control costs. Working with a specialized MVP company can help you select and onboard what's necessary and provide a quote accordingly.
The various areas of technologies include programming languages, data storage, automation framework, backend framework, frontend framework, hosting, load balancer, SQL data storage, and the web application server.
The Type of Contract or Engagement
The contract of engagement type you enter with the developer also plays a pivotal role in determining the MVP development costs. Let's look at a couple of contract types.
- Fixed Contract
As the name suggests, a fixed contract is where the development cost remains fixed. But you can enter such contracts only when you know the MVP's requirements, specifications, etc., will remain the same. One benefit of such contracts is that they help manage the MVP budget. But one must note that these contracts keep a margin of up to 30-40 percent to protect developers from unforeseen situations.
- Time and Material Contract
This is a more flexible type of contract, where you pay the developers based on the hours they have dedicated to development. It allows the scope for changes, requirement adjustments, features, and specifications. Thus, you pay only for the work the developer does. However, with this contract, you wouldn't know the total money you will spend on developing the MVP as you've assumed several changes will occur.
Partner with Trinesis to make an informed entry into your target market with result-driven MVPs. Our consultants will help you with a comprehensive MVP estimate based on your project needs, complexities, and other decisive factors.
Our design discovery approach enables us to develop empathetic digital assets that help companies expedite their journey to digital transformation and reap optimal value.
Email us at +1 707-760-7730 or sales@trinesis.com to pave the way for a valuable exchange of thoughts.