How Much Does It Cost to Build an MVP? Key Factors to Consider

Launching a minimum viable product (MVP) allows businesses to test the market for their app or software product before investing in a fully-fledged version. Positioned after a proof-of-concept (POC) and prototype but before refining the final product, an MVP offers a lean, iterative approach to product development. 

Despite being a relatively conservative step, an MVP still requires funding. Considering about one-third of startups fail because they run out of cash, businesses must budget accurately for MVP development. 

Estimating costs before an MVP build helps founders avoid hidden expenses and plan for a lean launch. In this article, we’ll break down the costs of building an MVP, identify key cost drivers, and offer tips for managing expenses effectively.

How Much Does It Cost to Build an MVP?

The cost of building an MVP varies widely, ranging anywhere from $10,000 on the low end to $400,000 or more on the high end. The true answer to, “How much does it cost to build an MVP?” is, “It depends.” Here’s a quick breakdown:

• Basic MVPs: $10,000-$50,000. Think lightweight MVP with few features, like a simple calculator app, to-do list app, or timer app. 
• Moderate MVPs: $50,000-$150,000. This MVP is more robust, like a patient portal or video editing software, for example. 
• Complex MVPs: $150,000-$400,000+. Complex MVPs often involve proprietary technology, specialized talent, or complex designs, all of which increase development costs. 

To find out where your project lands on this broad spectrum of development cost, you must understand which app elements act as price levers, pushing costs up or down. In the following sections, we’ll explore these key factors and offer clear examples to help you zero in on a precise budget. 

Key Factors That Impact the Cost of Your MVP

1. Complexity of the MVP

Overview of Complexity’s Role in MVP Cost:

Generally speaking, the cost of MVP development increases with complexity. That means a high-complexity app with lots of features will be more expensive than a simpler one. For example, an MVP for an employee resource planning (ERP) app that requires integration with other systems will almost certainly cost more than a basic fitness tracker app with limited functionality.

Complexity Levels:

To assess how simple or complicated your MVP is, think of complexity in three buckets: basic, moderate, and high. 

• Basic: A basic MVP includes only a few essential features. MVPs in this category may have a very simple interface or a single function.
• Moderate: Features like user authentication, database integration, or basic analytics all indicate that an MVP is moderately complex. 
• High: In this category, an MVP includes advanced features like payment integration, API connections, or AI functionalities.

Remember, by definition, an MVP should include only essential features. Future iterations may add complexity with new features; however, unnecessary functionality at this stage can waste valuable resources and slow the development process.  

Learn More: MVP Development: Formula to Learn What Features to Build into Your MVP

How Complexity Impacts Cost:

Intuitively, it makes sense that higher MVP complexity leads to higher development costs. Including complex features, like proprietary technology and database integration, requires more developer time. These additional hours increase labor costs. Likewise, some complex features might necessitate the help of a specialized expert, which also adds to the price of labor. 

Tips for Managing Complexity to Stay on Budget:

An MVP is an exercise in restraint. When there’s a vision for what an app could be, it’s tempting to build it out right from the start. Instead, start with a minimal version, then add features based on user feedback and business priorities. Restricting the MVP to only the essential features stewards limited funds wisely and reduces risk.  

Pro tip: Work closely with developers to identify features critical for launch and save “nice-to-haves” for future iterations.

Learn More: The MVP Advantage: Launching Your Product with Confidence

What Makes an MVP Complex?

While there’s no set rule for what qualifies as basic vs. complex MVP features, the latter tends to require specialized development expertise. 

An MVP might be considered complex if it includes these features or qualities: 

• Advanced data manipulation (ie. financial modeling, data visualization) 
• Machine learning 
• Artificial intelligence (AI) 
• Advanced security protocols 
• Custom integrations with external resources or APIs
• Real-time data synchronization 
• Unstructured workflows 

Often, a feature might not sound very involved, but because of the development time and talent needed, it adds significant complexity. Consulting a development expert is key to reducing the risk of surprise expenses and planning an MVP budget. 

Explore Designli’s mobile app development services → 

2. Design and User Interface (UI) Requirements

Importance of UI/UX for MVP Success

An MVP represents the first functional version of an app. Still, design is no less important for an MVP than for a more established app. An MVP’s user interface (UI) and user experience (UX) design inform the way users respond to it. No matter how complex the features of an MVP, having a user-friendly interface strengthens user adoption and retention. 

Design Factors Influencing Cost:

A budget-friendly MVP doesn't have to mean skimping on UX/UI design. For apps requiring unique design features, however, you should expect to pay more. Consider these ways that MVP design choices can impact your budget. 

• Simple, Functional UI: Opt for a minimal design approach, focusing on ease of use and functionality. Not only is a simple yet functional UI effective, but it also keeps costs down. 
• Custom UI Elements: Note that interactive elements, animations, or interactive brand-specific design can increase costs. Understand the cost-benefit tradeoffs of including such elements before you automatically include them in an MVP. 
• Responsive Design: Responsive design, that is UX/UI design that functions across mobile and desktop, is best practice. However, be aware that creating an app that functions on both mobile and desktop platforms, for example, can contribute to additional costs.  

As with other cost-related MVP decisions, it’s helpful to consider the goal of the product and which essential features will provide value to users. Future iterations can always include additional design features. 

Balancing Design Quality with Budget:

Designing an MVP requires balance. Aim for an application that balances both usability and cost. Your MVP probably won’t win any design awards, and that’s okay. Focus on delivering a clean, intuitive design rather than a highly customized look. Before pursuing a responsive or cross-platform development approach, consider which platforms or devices are the highest priority. In many cases, leveraging cross-platform frameworks can be an asset to your app’s success, However, in others, choosing just one platform is sufficient. 

Learn More: Cross-Platform App Development for Startups: Is It the Right Fit for Your App?

Does Design Impact MVP Cost?

Yes, MVP design choices can affect cost. Aiming for a simple, yet functional UI and choosing launch platforms carefully is the best way to minimize design-related expenses. While custom UI and animations might be essential for some MVPs, most can afford to incorporate design enhancements in future iterations when user feedback validates the need for such upgrades. 

3. Technology Stack

Choosing the Right Technology Stack

A technology stack—that is, the programming languages, frameworks, and tools used in development—has important implications, both on cost and the future of your business. The right tech stack balances both affordability and scalability. Be sure to do thorough research on all your options. 

Learn More: The Ultimate Guide to Choosing the Best Tech Stack for Your Product

Types of Tech Stacks:

When building an MVP tech stack, you’ll encounter several choices. Each type of tech stack offers benefits, but some are more costly than others. 

• Open Source vs. Proprietary Tools: Leaning on open-source tools, like React, Node.js, and Python, is an easy way to reduce costs. Proprietary tools, however, like those created by Google, Microsoft, or Adobe, charge licensing and user-based fees. 
• Cross-Platform vs. Native: Cross-platform tools, like Flutter and React Native, save time and cost by enabling single-code-based development. Unless you plan to deploy your app only on one platform, consider choosing a cross-platform approach to save on long-term costs. 
• Cloud Services and Hosting Costs: Cloud services offer valuable flexibility, allowing businesses to utilize only the server space they need. Don’t forget to factor hosting costs into your MVP development budget. Platforms like AWS, Firebase, and Heroku all offer scalable solutions but come with ongoing costs.

Cost Implications of Different Stacks:

Some tech stacks boast cult-like popularity, but that should not be enough to make your choice. Be sure to weigh the short- and long-term costs of choosing one stack or another. For example, the MEAN tech stack—MongoDB, Express.js, Angular, and Node.js—leverages fully open-sourced technologies, making it a cost-efficient stack. By contrast, the WISA tech stack—Windows Server, Internet Information Services (IIS), SQL Server, and ASP.NET—can become quite expensive over time. 

Tips for Choosing a Cost-Effective Tech Stack:

When it comes to your tech stack, it’s important to take a holistic view of cost. What’s cheapest today might not be the most cost-efficient long-term. This is particularly true if your tech stack limits future growth. Look for a set of solutions that accommodates today’s budget and technical requirements while still leaving the door open for growth down the road. If you anticipate the need to scale up your operations in the future, choose a tech stack that prioritizes scalability and flexibility.

What is a Cost-Effective Tech Stack for MVPs?

A cost-effective MVP tech stack typically includes a mix of open-source, cross-platform, and cloud technologies. 

• Open-source technologies, like React Native and Node.js, are free to use and often offer libraries of ready-to-use components, which speeds up development time and reduces labor costs. 
• Cross-platform frameworks, like Flutter and Xamarin, can save time and money, offering a faster alternative to native approaches, thanks to a single codebase. 
• Cloud solutions, such as AWS and Microsoft Azure, also offer a cost-conscious option by keeping expenses proportional to usage while still offering an opportunity to grow. 

Learn More: Navigating the Cross-Platform App Development Landscape: A Comprehensive Guide to Frameworks

4. Development Team Structure

Types of Development Teams and Their Cost Implications:

The team you choose for MVP development directly impacts costs. The best model balances business needs with budget. Whether you choose an in-house, outsourced, or hybrid model, understand the tradeoffs of each first. 

• In-House Team: An internal team requires higher initial costs, due to salaries and benefits. In the long term, however, an in-house team offers support to tackle improvements or any issues. 
• Outsourced Development: Hiring freelance developers or using agencies is often the most affordable MVP development approach, allowing businesses to access a dedicated team for the duration of the project. 
• Hybrid Model: A hybrid approach, with in-house oversight and outsourced developers, can be a way to achieve more control while still benefiting from the flexibility of as-needed developer talent. 

Key Roles Needed for MVP Development:

Even a focused development effort like an MVP requires several key roles. 

• Product Manager: Oversees project goals, timeline, and communication. 
• UI/UX Designer: Focuses on designing the user experience and interface.
• Front-End Developer: Builds the user-facing side of the app, including all the features the user can interact with and see.
• Back-End Developer: Handles server-side logic and database management, including how data is accessed, processed, managed, and stored.

Each team member brings a specific expertise and serves an important function in the development process. 

How Team Choice Impacts Total Cost:

Hiring individual freelancers can be the cheapest option; however, this staffing model requires significant oversight. An agency offers a happy medium between freelancers and an in-house team. The right development partner offers a clear and reliable process plus a solid team of experts at a fraction of the price of an in-house team. Building up an internal team offers the highest degree of control, but it comes at a cost. An in-house approach tends to be the most expensive development team structure.

Cost-Saving Tips:

As with your app itself, a lean approach will save you from unnecessary spending. Try starting with a small team that only has the essential roles. A small but high-quality team will often get you further than a large team of questionable talent. Remember, you can always hire additional team members and development specialists later. 

In-House vs. Outsourced Development for MVPs

In the absence of an existing in-house development team, outsourcing is typically the best approach to manage MVP price. A partnership with a development agency allows you to “turn on” the development team whenever needed, without having to worry about employee costs like training, office space, salaries, or benefits. In addition to upfront cost, also consider your business goals, timelines, scalability needs, and preferences for control when choosing between in-house or outsourced teams. 

Learn More: Outsource vs. In-House Software Development: Making the Right Choice for Your Business

5. Iteration and Testing Expenses

Why Iteration and Testing are Crucial for MVP Success

Testing and iteration are a vital part of MVP development. Releasing a well-tested, functional product increases your chances of achieving early adopter satisfaction and gaining traction. On the other hand, failing to prioritize iteration and testing steps can result in bugs, security incidents, or service interruptions, all of which jeopardize business success. 

Types of Testing for an MVP:

Testing for MVPs includes two critical rounds, alpha and beta testing, each of which informs early product iterations. 

• Alpha Testing: This phase of testing occurs before the MVP is ever in the hands of real users. It involves the internal team only, and it’s designed to catch obvious issues with the app. 
• Beta Testing: In this phase of testing, a few early users test the product for usability, functionality, and bug identification. This round of testing leads to iterations that improve the product before it’s widely adopted. 

Cost Considerations for Testing and Iteration:

Initial testing usually isn’t a significant expense, compared to testing later on in the iterative process. Often, it’s not the testing itself, however, that contributes to development cost as much as the iterations that stem from feedback. If an MVP requires frequent adjustments, expect more development expenses. Relatively small updates, like simple feature additions or color changes, likely won’t pose a huge financial burden, but iterations that add complexity can get costly quickly. 

Budgeting for Post-Launch Updates:

To avoid surprises, it’s a good idea to allocate a portion of your MVP development budget for bug fixes, minor updates, and scalability improvements. This ensures you’ll be able to address user feedback promptly and with adequate iterations. Especially in the beginning, user satisfaction is critical for gaining momentum. 

Cost of MVP Testing and Iteration

The cost of testing and iteration varies based on various factors, including the kind of testing, the complexity of the app, and the type of iterations. Hiring a team to conduct user testing, for example, will be more costly than straightforward alpha testing, which focuses on glaring issues. Likewise, iterations that require advanced development techniques, like unstructured workflows or connecting to APIs, will cost more than simple cosmetic changes. You don’t necessarily need to spend a lot of money to embrace the agile development methodology. Working with an experienced development partner can help you solicit and respond to feedback while managing limited funds. 

6. Hidden Costs

Planning for Hidden Costs 

Without proper planning, hidden costs can quickly derail an MVP budget. Hidden costs are fees and expenses that aren’t apparent in the development process but are still vital for success. App store fees, such as those Apple and Google charge for launching iOS and Android apps, are one common example of a hidden cost. Other examples include legal fees or promotional expenses. Anticipating hidden costs is crucial since they can quickly add up and become a significant expense. 

Types of Hidden Costs 

There are many categories of hidden costs, but not every type applies to every app. Knowing what to look for can help determine which hidden costs could affect your MVP development process. 

• Legal Fees: Some MVPs incur legal fees to draft user agreements, trademark brand logos or names, register a business entity, copyright elements of the app’s code or design, or comply with industry regulations. 

• Licensing Fees: Some technologies, especially cloud services like AWS and Google Cloud Platform, charge licensing fees. These are often based on usage. Some development frameworks also require special licenses for commercial use. 

• Maintenance Costs: Post-launch expenses can include bug fixes, updates, or feature additions based on user testing and feedback.

• App Store Fees: Listing your app on app stores requires a fee. Depending on the provider, these are typically annual or one-time publication fees. 

• Marketing and Promotional Fees: Most apps require some sort of marketing or promotion to get the word out and attract new users. The cost of marketing depends on the method and scope employed. 

• API or Third-Party Integrations: Leveraging APIs or other third-party resources, like premium developer libraries, can require licensing fees. Customizing these resources or overcoming integration hurdles also can add developer time and cost. 

Hidden Costs Management Tips

It’s a good idea to reserve a portion of your MVP development budget specifically for hidden costs. Consider which types of hidden costs apply to your MVP so that you can include an appropriate budget buffer to use if needed. Some experts recommend earmarking about 20 percent of your development budget for hidden and unforeseen expenses. 

How to Budget for the Hidden Costs of MVP Development 

The best way to budget for hidden costs is to understand common types of hidden costs and anticipate them before your project kicks off. Most hidden costs are directly tied to your MVP’s technology stack and intended platforms, which tend to be transparent about their cost structure. For example, many pay-as-you-go cloud platforms publish price calculators to help developers estimate licensing fees based on expected usage. Researching these costs ahead of time can help you build a comfortable budget with enough margin. 

How to Stay on Budget for MVP Development 

A clear and accurate projected MVP cost can help you stay on budget and reduce the risk of insufficient funding. To estimate cost, hone in on the key factors influencing MVP price: complexity, design requirements, technology stack, team structure, as well as iteration and testing. In each category, there are ways you can manage cost and budget effectively. Most importantly, prioritize only the most essential features, choose a cost-effective technology stack, and reserve funds for iteration. The time and effort it takes to nail down a clear MVP cost range pay off. A well-planned MVP offers a foundation for future growth by serving as a tool to collect worthwhile insights. 

Looking for a partner to help you achieve extraordinary value from your limited MVP budget? Designli specializes in supporting businesses through the MVP development process. From assembling the right team to choosing the right frameworks and more, we help our clients navigate all the MVP decisions and take the next step toward their business goals. Schedule a free consultation to discover more.  

Explore Designli's UX/UI Design Services →

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