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How Much Does It Cost to Build an MVP for a Startup?

I’ll start with some bad news – 9 out of 10 startups fail. Fact.

But, hey, that doesn’t mean you should throw your startup dreams out of the window!

Let’s say, it’s just a word of caution before we get going.

Want to know the two most common reasons of startup failure?

One – poor finance management.

Two – failing to scrutinize the target market.

Whether you are bootstrapping, searching to close an investment round or just landed some angel help, being careful with your finances and testing your product concept prior to going all-in is essential to succeed in the long run.

And that’s exactly where minimal viable product rolls in.

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What Goes Into a Minimal Viable Product?

The concept of MVP was popularized by Eric Ries – a Silicon Valley entrepreneur and leader of the lean startup movement.

Reis was the first to point out that you don’t need to launch a full-featured product. Instead, it’s worth adopting a continuous approach to product development and add additional functionality within time backed up by validated learning data.

According to Ries, to minimize the involved risks – build a minimal viable product first.

In a nutshell, an MVP is a product, service or website with some basic set of features to satisfy early adopters and survey the market interest. Complete functionality is added only after the product owners had gathered real user feedback and secured some pre-orders/early funding.

To develop a minimum viable product, you need to identify the right technique of how to present your idea and measure user response to it. As Ries calls it – a “build-measure-learn feedback loop”.

So that’s what an MVP should do for your startup. Now let’s have a close look at the types of MVP you can create depending on your niche and the varying MVP development cost you can bear at the early stage.

Types on MVPs Worth Using To Validate Your Idea

You should create an MVP for two primary reasons:

  • To pitch your idea for funding.
  • To validate your product hypothesis viability with the end customers.

These two reasons come with a Catch-22, however.

You can’t get funding unless you can prove that the market wants your product.

And, at the same time, if there’s a market demand a lot of investors will feel reluctant to throw money into something intangible and incomprehensible.

Hence, to make an MVP for startup you need to get your back covered for both cases.

There are different types of MVPs you can choose to build first:

  • Product wireframe
  • Product Mockup
  • MVP mobile app
  • Explainer Video
  • Landing Page
  • Website
  • MVP mobile app
  • Software Prototype

In this post, we’ll cover the first three MVP types (along with the costs involved).

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Product Wireframe

Wireframe is the skeleton of your mobile app to be. It’s a rough, often black and white layout of the features, navigation and screens you plan to propose in your product. This is the first step you can take to create a minimum viable product for a mobile app or a web service.

Wireframes should outline your sitemap; highlight the core features based on your target audience and hint how the in-app content will be presented.

If you are bootstrapping, you can create those yourself for the initial pitching session or prior to approaching a mobile development company.

If you choose to hire a freelance designer or an agency, get ready to pay around $1000 – $5000 depending on the complexity of your app or website.

Product Mockup

Mockups breathe in more life and depth into your product vision. Basically, those are the replicas of your final product – same colors, design, features and navigation.

A mockup realistically represents how your project will look and feel in real life, yet it’s not powered by the back-end technology, which animates it.

Eric Reis in his book describes how Zappos talentedly played with their mockups to validate the marked demand and depth.

This approach got a witty nickname “Wizard of Oz MVP”.

An ecommerce company now boasting $1 billion per year revenues got started as a simple website with no actual ecommerce backend.

The founder just approached a few local mom and pop shoe sellers, asked to take pictures of the shoes on sale, and prominently placed those on his website. The orders started coming. He went to the shop, asked for the same pair that was ordered, shipped it to the buyer and handled the payments. While this certainly wasn’t a scalable business model, it allowed Zappos to validate their assumption that people do buy shoes online.

Interactive mockups are one-step forward in this case. Thanks to the tools like Framer and InVision you can demonstrate how the app will look like to early-bird adopters and potential investors.

Additionally, our development company when working on an MVP for a startup always suggests running a few tests with actual target users to verify the initial design and features.

So do you really need to create an interactive mockup rather than an MVP mobile app first?

Jason Zimdars, UI designer at Basecamp weighs in on the pros of mockups for mobile projects:

Even for the simplest of changes the difference between refreshing a web browser and building an app to a device (or simulator) is orders of magnitude slower. It’s worse when you consider that making even seemingly minor visual changes to iOS or Android designs in native code can take much more time than you might expect”.

Interactive prototypes were their go-to solution for the next reasons:

  • They are faster to craft (and reduce your budgets)
  • Can show how apps will look and feel on multiple devices
  • Easy-to-share
  • Work great for cross-platform development projects.
The cost to create an interactive mockup can vary from $5.000 to $10.000 and usually it takes between 1-3 months to create one.

Create a Mobile App MVP

Product wireframes and mockups certainly allow you to validate your market assumptions.

But…

They don’t exactly show how users will behave within your product.

Plus, building a mobile MVP will allow you to test your idea with a larger audience segment. After all, users feel more encouraged to try a new app, rather than some wireframe.

If you are building your first MVP, a mobile app may be the right choice if:

  • You have limited development budgets, yet want to start ASAP.
  • You already conducted prior audience survey and got positive response.

All checked?

Good now, you need to settle on the MVP development cycle. Typically, it goes like this:

  • Formulating hypothesis for testing.
  • Create a project requirements list.
  • Write down all the product features you want to have – those should also include a technical scope to give you a better idea of how difficult/costly those are to implement.
  • List each feature in terms of priority – which will create the most value in the short-term perspective?
  • Scale each feature from 1 to 10 based on their complexity, product importance and added value for the users and focus on developing the top 3-5 ones depending on your budgets and the time available.
  • Build an MVP (Development stage)
  • Launch and release your mobile app.
  • Test your assumptions and record user feedback. Focus on discovering the key product strengths and bottlenecks.
  • Process the obtained data.
  • Turn it into a new list of hypothesis and product features.
  • Rinse and repeat all of the above.

Google, Yahoo, Instagram and Foursquare all followed this path.

In a nutshell, that how you create an MVP that stands a chance.

How Much Does It Cost To Build a Mobile App MVP?

For starters: here’s how much some of the most popular mobile apps prototypes cost:

android

ios

Don’t forget – these are the rock-bottom prices for a very basic MVP (closer to a prototype) with 1-2 core features, simplistic design and executed by one freelancer.

The Next Web published the following MVP costs of top products quoted by top US CTOs:

  • Twitter – $50,000 to $250,000
  • Instagram – $100,000 to $300,000 in 3-6 months
  • Facebook – $500,000 in 9 months
  • WhatsApp – $250,000 in 9 months
  • Uber – $1M to $1.5M
  • Pinterest – $120,000 in 4 months
  • Shopify – $250,000 and $300,000 in 4-6 months
  • Vine – $125,000 and $175,000 in 4 to 6 months

The average cost to develop a minimum viable product will highly depend on the kind of solution you plan to implement, types of MVPs you need (outlined above) and whether you hire developers locally or internationally.

You need to have a clear understanding of how “complete” and “workable” your product should be.

What features you are willing to compromise at the early stage to keep the development costs at bay, yet gain the initial user feedback?

So how much does it cost to build an MVP?

  • Simple prototype for pitching – between $5.000-$10.000
  • MVP mobile app – between $15.000 – $50.000 depending on the product complexity.
  • A simple promo website – less than $2.000

How Long Does It Take To Build an MVP?

Again, it all boils down to the type of the MVP.

A simple website or app prototype can be up and running in less than a month.

Building a mobile app MVP (a product including two-three key features) can take under two months if you partner with Alty developers.

Here’s another quick tip.

The next mobile app features will take the more time to develop:

The most time-consuming and pricey elements are:

  • Third-party API integrations.
  • Billing and payment integrations (if necessary).
  • Database encryption.
  • Advanced admin panel with powerful analytics.

In the end of the day, it all breaks down to what you can afford at the moment and which solution will be enough to validate the key product assumptions you have.

And if you need help with the development, Alty team is always here to help!

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