It takes a lot of hard work and energy into making a well-polished, finished product.
This realization hits hard when an aspiring entrepreneur decides to transform their idea into a user-centric, wholesome product.
And as they dig deep into the intricacies of product development, it becomes clear that they should not directly develop a full-fledged product.
Instead, the wiser move is to develop an MVP and test the waters first.
The obvious questions then, how would one develop an MVP, and how much would it cost?
Not just the basics; we are here to give a clear understanding about how the cost to build an MVP is determined.
What is an MVP?
Simply put, an MVP or a Minimum Viable Product is the version that is basic but suitable for public release. It has the core functionality and addresses the important needs of the target users.
For the MVP to impress users enough so that they start spending time on it, it would obviously need to have the following:
- A UI that lets the user navigate through the MVP freely
- The core features that solve the problem/facilitate the task
- A solid back-end architecture that can be molded if the idea gets positively validated
These three factors are crucial and intricate enough to demand a lot of developmental resources. As an aspiring entrepreneur, you might doubt the necessity of an MVP.
Why do you need an MVP?
An MVP helps you validate your product idea
As much as you would want to believe in your guts, relying on intuition for serious business matters is a huge risk.
Especially when it is a new product that you are thinking about.
Preliminary market research might tell you that your idea/product fills a gap, addresses a vital missing link.
Before jumping into the prospect of having satisfied users’ needs and built a successful product, you would need to consider a few things.
Firstly, if your idea, your version of the solution for the users is actually the right one.
Secondly, if your target users are really interested in the type of product that you envision.
You might plan for a full-fledged product when all they need is an applet that addresses their needs immediately.
An MVP helps you validate your market research and your product idea concretely.
The MVP goes into the hands of your target users, they perform a few tasks, and in one way or the other, you get your necessary feedback.
It is always better to know if the path that you are choosing really leads to your desired destination.
An MVP can help you reach Product/Market fit faster.
Product/Market fit is the metric that shows you how well your product addresses the needs of the market.
Your product idea might have passed the first round of testing: validation.
But a successful product is much more than that.
Product/Market fit shows you exactly how well the users appreciate your product and which features appeal the most.
And which features don’t.
As a matter of fact, the better the product/market fit is, the faster the user base adopts the product.
Instead of launching a complete product and then slowly figuring out the wrong pieces and fixing them, you could release an MVP.
And get the same insights in a faster, more agile fashion.
Since MVP and their consecutive versions are light-weight and focused, it becomes easier to build multiple iterations, thus improving faster.
An MVP helps you get better funding opportunities
What is better than a half-cooked meal?
A fully cooked one, complete with all the garnishes.
When you go for investor meetings and pitch your product/idea to get funded, what do you think would fare better: a prototype or a functional MVP?
The answer is obvious.
And the advantages are multiple.
It makes convincing the investors and explaining the core features and the unique selling point of the product/idea much easier.
Because the MVP would be right in front of them, available for demonstration and quenching doubt.
Any gaps in understanding what your product does would be minimal, making it easier to sway the investor’s minds to your favor.
Further, you establish that you are highly determined because you already have an MVP in hand.
Factors that affect the cost of building an MVP
Now that the advantages of building an MVP are clear, let’s jump into the crux.
A smooth UI and the core features of your product are the essentials of your MVP. But the other factors that vary from one product idea to another are:
Type of product/service
This is the biggest factor that decides how much your MVP’s development will cost.
Building a CRM is a completely different task than building a billing tool.
Or maybe your product is something that enhances navigation in some way.
Different categories of applications utilize different types of tech stacks.
A technology stack is the set of programming languages/platforms that would enable your product.
Based on your requirement and product vision, you would have to hire or outsource programmers that specialize each of their stacks.
The more ambitious your product is, the more number of tech stacks it would require.
But there is something beyond just the number of tech stacks that your MVP would need.
The degree of implementation.
For simple tools, services, and applets, the technology implementation is limited to just the few features.
But for larger products with multiple features and possibilities, the implementation gets deeper.
And that naturally means more cost that you’d have to spend to build your product or MVP.
Number of features
Increased requirement of implementation increases the cost of your MVP.
But depending on why you decide to build the MVP, you could decide to build just a small set of the core features.
If your plan is to validate your product idea, you can ask for only the most crucial parts to be built.
If your plan is to better achieve product/market fit, then you can get the features that already appeal to the users to be iterated again for testing.
Simply put, the more number of features you decide to build, the more time it would take.
And the more money you’d have to spend.
You could possibly have more features built in less time but that would obviously affect the quality of your MVP.
How polished you want your MVP to be
Features aside, an elegant UI takes its own time to be developed as well.
As simple as it might look, each aspect of a user interface has to be brainstormed upon, researched, tested, and iterated before it can fit well into the overall user journey.
It is no secret that a fine UI and a well-tuned UX would attract the users and keep them engaged on your platform.
If you want more users to stay on your product, to use it to perform tasks and solve problems in their everyday lives, then you would need a squeaky clean UX.
And you’d have to pay for that as well.
However, depending on your reasons for getting an MVP built, you could probably tone the developmental efforts on the UI to save some money.
A well-built MVP always has the potential to scale into a fully-fledged product.
Because, essentially, an MVP is nothing but the product stripped to its core.
Scalability adds up its own share of the developmental cost, however.
Choosing the architecture, planning it well, implementing it so that it can grow and scale as more code and features are added later are not easy tasks.
While you could decide on toning it down on the scalability, if you are really passionate about building a product, you should invest in this aspect.
Compared to building an entire product, this is a smaller risk that can result in a huge payback if your product idea gets validated positively.
Who would build your MVP
This is the second biggest factor that decides how much your MVP would cost. Your paths to building a solid MVP would be:
- Finding the right talent and working with them on your own
- Hiring freelancers
- Outsourcing the development of your MVP to a digital product agency
Cost-wise, it is risky as well as highly time-consuming to hire the right talent, align them to your goals, and then begin to develop your MVP.
On the flip side, you could avoid all of those and instead choose to work with experienced freelancers. You would probably save time as well as a lot of money.
But, building a rapport with freelancers that lets you trust them would be a hassle.
Also, getting them to produce exactly what you want would be difficult.
Which means, you would be left to consider the last option: Taking your product idea to a digital product agency to get it developed.
Digital Product Agencies and MVP
As an aspiring entrepreneur, it might seem like a bit of a risk to hand your product idea over to a collective that you hardly know about.
But a digital product agency combines the best of both worlds: freelancers and in-house developers.
You get to avoid the hassle of finding and making a cohesive whole out of all the talented people.
And you will not need to worry about this collective not producing exactly what you need.
Most digital product agencies have a lot of experience and stellar products under their belt.
Plus, the good ones run like a well-oiled machine. You put in your demands and you get the result.
For budding entrepreneurs, digital product agencies also pose the advantage of accelerated learning.
You get to see your idea transform into a product in real-time, and also get to fill your knowledge gaps through this process.
Additionally, professional digital product agencies that take pride in building products efficiently always implement a product roadmap.
Meaning, your cost of building an MVP gets broken down in terms of milestones.
This milestone pricing gives you a clear picture of what you’d need to spend in order to get your envisioned result.
And since the MVP is broken down as milestones, you can choose to simplify or skip a few to fit your budget.
Having a product idea that possibly addresses a crowd’s problems is just the first step.
With your aspirations raging higher, as an entrepreneur, you would want to move on to the next step.
Making the product idea a reality.
And that is when you stumble on the concept of an MVP and all of its advantages.
To get an MVP done efficiently and under a cost that seems justified, choosing the safer, tested route of hiring a digital product agency is your best bet.
Your product idea would get a home where it would thrive and grow into the ambitious version that you want it to be.