MVP Development: Process, Benefits, Types, Setup & Cost

MVP development is crucial for both startups and large companies to ensure product viability before a full-scale launch. Startups, often with limited resources, and R&D departments of big firms, need to test product ideas against real customer needs. CB Insights found that 35% of product failures stemmed from inadequate market and customer research. It's not always about having a perfect idea but aligning it with customer expectations. MVP development provides insights into market traction and potential adjustments to outpace competitors.

Our company has been developing MVPs for startups and enterprises dozens of times. You can see examples of MVP products in our portfolio.

According to CB insights, in 35% of cases, poor market, product, development, and customer research resulted in product failure.

In this article you’ll learn how to develop an MVP, the cost to build an MVP, team composition, and the benefits of MVP development for startups and enterprises from more than seven years of our successful MVP and product development experience.

Why most startups fail with their MVPs

You might think that MVP is not worth the investment if you are planning to launch the full functionality of your product. Or you might be 100% sure that your idea will fit the users’ needs and distinguish it from the competitors. But almost 90% of all new startups fail, according to recent research. So, let’s cover the most widespread reasons on why this happens:

Lack of research

First reason as to why startups fail with MVPs is that they skip the discovery and concepting stages. Discovery phase of the product helps to analyze the market, create the product's concept, build a roadmap, and design a prototype. However, oftentimes businesses decide to omit this important stage of developing an MVP and don’t analyze the market enough struggling to find the promising niche.

Lack of skilled human resources

The second reason for startup failure is the lack of experienced professionals, particularly in the development field. Sometimes, because the budget might be tight, it’s hard to hire experienced developers. Another reason might be that due to the lack of specific knowledge and experience in development details, startups tend to mishire specialists.

Incorrect choice of tech stack

The third reason is tightly connected to the second one – due to the lack of professionals experienced in specific fields, startups might make a wrong choice when deciding on the tech stack they use for their MVP. This may lead to the skyrocketing price of the whole development and make their MVP too expensive to support.

Lack of development steps

Sometimes, due to tight budgets, limited time frame, or lack of product development experience, businesses may skip such important stages of the development process as QA and software architecture. However, it can lead to critical errors, profit loss and even inability to release MVP.

How we set up the MVP development process

Let’s examine the usual MVP development process so that you have some understanding of the basics:

1. We provide an audit of an existing idea or a product

MVP product development is all about introducing those values to people to get their honest reactions. We outline those ideas, and then develop a viable MVP based on them. The question we answer at this stage is what needs the product fulfills or what problem it solves. That’s why our business analysts analyze the TAM (total addressable market), PAM (potential available market), competition, and market size.

2. We provide business requirements documentation

A business requirements document describes the critical activities of MVP development services that must be performed to meet the organizational objectives. It details the business solution for a project including the documentation of customer needs and expectations. The BRD usually contains agreement with stakeholders, provides a basic tech stack and roadmap of the development process, and describes what customer/business needs will be met by the solution. The BRD is important because it is the foundation for all subsequent project deliverables, describing what the system would look like from a business perspective.

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3. We provide software architecture

Software architecture is an essential part of the MVP development process. It plays a significant role in how to design, make, sell, use, and support a new product. Put simply, it’s the strategy of mapping the function to form, making redundancies more apparent and better expressing the relationships between different features.

4. We develop a product roadmap

Once we’ve defined all of the needed elements and features, we determine their scope for the initial version of the product and create a product roadmap. A roadmap aims to communicate a product strategy and put product plans into action. It’s a guiding strategy document mapping out the vision and direction of product offerings over time.

5. We build and handover ready MVP to test out specific set of features

Once we’ve determined the key features, learned about pressing market needs, created a roadmap and business requirements documentation, we can create an MVP prototype with which we’ll start to gather feedback. The prototype should not be of poor quality: it should satisfy the user, even if certain elements are being held back. The product should be easy to use, visually appealing, and it should satisfy the main “pain point” that justifies its existence.

MVP development cost

Are you wondering how much does it cost to build an MVP? Costs of MVP development for startups and enterprises depend on many inputs:

• product complexity,
• features,
• size,
• design,
• and time frame.

The number of members in a development team can also increase or decrease the price. You will typically need the following employees in a team:

• 1 Project Manager
• 1~2 UI/UX Designer(s)
• 1~2 Android/iOS Developer(s)
• 1 Frontend Developer
• 1 Back-end Developer
• 1 Analyst

What about the details of the complete MVP app cost breakdown by stages? You can find information about the time and price for each stage of app development below. And you can understand the required budget and timing of your project.

1. Estimation, Research & UI/UX design

Time: 280 hours
Cost: $8 400

The development process always starts with the discovery phase. That is when a general overview of the product, its steps, and features will be discussed. We study your requirements, needs, and wishes for your project. Then our company creates a list of items for analysis.

We collect all the necessary data and process it to find patterns that are relevant to your expectations. And our company approves with you all details of your future MVP product.

After business analysis, there will be wireframing and prototyping. This stage is devoted to UX design, understanding the target audience, and creating user journeys and flows. The UX deliverables will be hi-fi wireframes and low-fi prototypes. Once the client has agreed to the prototype, that's when UI design starts.

A PMI survey found that 30% of respondents called “poor communication” the primary reason for the scope gap and project failure.

2. Development

Time: 640 hours
Cost: $25 600

Depending on its main purpose, you'll decide what technologies to use to implement your features. We together figure out what database to use and also what program languages and CRM. It's also critical to find out the best solution for your app realization to meet your timeline and budget, like using APIs integrations, SDKs, or building features from scratch as well.

3. Testing & Launch

Time: 240 hours
Cost: $6 480

The development stage happens along with continuous testing run by QA engineers – we do many different tests to check if everything works correctly in your application. Our team corrects errors if they occur. Hence, now you should get a clear understanding of MVP app development.

4. Creating technical documentation

Time: 40 hours
Cost: $1 600

The company's IT specialists create a document that contains all the necessary information about your application.

Assuming that your app is not overly complex and overflowing with features, it is expected that it will cost from $25,000 to $45,000.

However, if you want your app to contain a video conferencing feature, you shouldn’t spend time and money on pricey and time-consuming third-party integrations when working with us. We’ve developed our own video conferencing engine VidRTC. VidRTC is a customizable engine that is used for internal and external business communications. It can support basic features such as video calls, calendars, scheduling, and text messaging. VidRTC is a cost-effective, time-saving, and ready-to-use multipurpose tool which costs only $10 000.

Benefits of building an MVP

Starting the product development, you should keep in mind that most of the major reasons for product failures can be resolved by building an MVP before the release of the entire functional product. Here are the main MVP benefits for business:

Test your product in real market conditions

The MVP is almost all about research. It gives the opportunity to gather the necessary information to start the development process, then to enter the real market and field-test your research data. With the MVP development process you can define your target audience and observe how your potential customers react to your product’s concept in practice.

You can also learn whether the product’s features will truly solve an existing problem that your target user has. In marketing, this is sometimes called a “pain point.”

MVP development also provides the opportunity to expertise from experienced professionals, especially if you decide to hire MVP developers skilled in the industry you aim to operate.

Cost-effectiveness

It is undoubtedly the most significant advantage of a minimum viable product. That is because you’re not sinking a great deal of money into the idea before you have any real knowledge of how the public is going to react to it.

Viable product

The MVP method ensures that the product is going to be viable once it hits the market. It is a way of being sure beyond a reasonable doubt that users are going to find it appealing which makes it almost entirely risk-free.

Minimum time to market release

This is another reason that this method has caught on so much in the modern business world. If you are executing this technique correctly, you can get your product out there in a much shorter time. The development process is streamlined because you’re incorporating feedback each step of the way.

According to Startup Genome, 9 out of 10 startups fail because of skipping the discovery phase and lack of external audits.

Detailed software documentation with product roadmap

If working with the top-notch specialists with hands-on experience in your chosen industry, not only will you get the tested working MVP with market and competitors’ analysis, but also the detailed software documentation with product roadmap and a complete picture of your product.

Case Studies: Successful MVP Examples

While understanding the theory behind MVP development is essential, observing real-life examples can give a clearer picture of its practical application. Let's delve into some of the most iconic MVPs that later transformed into market giants:

Uber

Originally started as 'UberCab,' Uber's MVP was a basic mobile app connecting passengers with San Francisco drivers. With limited functionalities and operating only in a single city, it aimed to gauge interest and feasibility. As we all know, the overwhelming response eventually led to its global expansion.

Instagram

Before becoming the popular photo-sharing app, Instagram began as 'Burbn.' This MVP was primarily a location-based check-in app resembling Foursquare. However, noticing that users were more inclined towards photo-sharing, the platform pivoted and became the Instagram we know today.

Amazon

The e-commerce titan started its journey as a minimalistic online bookstore. Jeff Bezos had a list of 20 products to sell online and decided to start with books due to the vast global demand and low prices. The MVP's success paved the way for Amazon's expansion into diverse product categories, making it a one-stop shop for almost everything.

These successful MVP examples highlight the importance of starting small, testing the waters, and then iterating based on customer feedback. Each of these companies began with a basic version of their product, gauged user interest, learned from their audience, and refined their offerings. This iterative approach, rooted in MVP philosophy, has been a foundation stone for some of the world's most successful enterprises.

MVT Types That We Build

Based on our more than seven years of successful experience in developing products of various complexity in multiple industries, we always suggest our clients start their development journey with an MVP. Here are several examples of MVPs we’ve created:

Parta

Parta app is an audio and video-conferencing solution that have a set of key features, such as:

• Broadcasting;
• Streaming;
• Private calls;
• Video rooms;
• Following;
• Room moderation;
• AI-generated news feed;
• Gifts and donates.

We put much effort into creating a social media network app during the development process. Our team managed to deliver MVP in three months using new technologies to cope with the complexity of the app development and provide the client with a working, competitive application. However, using our pre-developed video conferencing engine VidRTC made our job much easier.

As a result, the list of technologies we used to develop a video conferencing solution for Parta Social consists of VidRTC, MediaSoup, React Native, Redux, Node.JS, AWS, and GraphQL.

Locum App

The Locum App is a staffing platform for pharmacies and pharmacists. Widely used in the pharma industry, this app streamlines and automates the recruiting process in the UK pharmaceutical market.

Our development team was faced with the challenge of building an online MVV application that should solve the needs of both parties – applicants and employers.

Development of the application works effectively for both parties with two separate user flows. The application has a different admin panel depending on the flow, in-app messaging, custom notifications sent when the job is posted, and job sharing features — out of the app.

Dollar Shave Club

Softermii development team has created an MVP for Android version of the eCommerce app Dollar Shave Club. It provides men with personalized packages and delivery of razor blades, handles, aftershaves, and other male shaving products. However, the MVP version was a mono product e-shop with such features as:

• Buying shaving products in 1 click
• Scanning of a credit card for payment
• Sending a gift to the user's male friends using the mobile app

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We A/B tested an MVP version to secure great performance results across all devices and social user groups. And our dedicated team helped boost the Dollar Shave Club's conversion rates which was followed by further product development.

Real Estate Association

The French Real Estate Association approached us to develop a mobile app used by realtors that can provide real-time information about the properties available for purchase or rental.

We started with market research and business analysis to define the key features and tools that a platform should comprise. Later, we moved to UI/UX design and coding. We developed a mobile iOS application that allows interaction between agents and clients. It helps to improve customer satisfaction and increase the number of successful transactions.

We introduced the following features to the MVP:

• real-time visibility of the market section with the option to geolocate and filter searches to identify properties that meet customer requirements
• detailed descriptions of property added to the platform
• collaborations between agents and agencies
• notifications

How to Start Developing an MVP

MVP development usually starts with an idea. In the early going, you should have a clear idea in your mind concerning the primary values you want your product to have. MVP product development is all about introducing those values to people to get their honest reactions. You must outline them, and then develop a viable MVP based on them.

And if you want to save money and work with top-notch professionals at the same time, we suggest you contact us so that we could move through to the next stages of MVP development.

Our development team at Softermii has provided full-cycle mobile and web development services to clients from various industries. We can create the MVP of any complexity and for various industries from scratch to fit your business needs and market expectations.

We have a dedicated team consisting of Project Managers, Business Analysts, UI/UX Designers, Mobile App Developers (iOS & Android), and Quality Assurance Engineers ready to move into action with your project and make your product thrive. Drop us a line to start your MVP development journey!

Ensuring a product’s viability is probably the most vital aspect of the MVP development process. And we know how to develop a product that will pull the market and won’t fail.