Let’s Talk Money— MVP

app development

[Note: If you’re here only for a quick answer for MVP app cost without learning about the hows and whys, check out our summary down here. You’re welcome.]

So, you know that viral meme about how new grads can’t get a job because they don’t have the experience, and they can’t get the experience because they don’t have a job? Well, the interaction between an entrepreneur (or business) and an investor is pretty much the same when the former has a software solution in mind. Allow us to illustrate with a relevant meme:

app development

                                             Pictured: Very professional professionals

Alright, jokes (and memes) apart, this is a real-world problem. Individuals or businesses may have excellent product plans, but they can’t find investors unless they have a working solution to prove their idea has merit. And if they do create a product, it’s often so late the market need has changed, or there are new competitors with better solutions.

So, how do we break the chain? Thankfully, unlike the job-experience fiasco, there is an answer to this problem—minimum viable product software development.

What is an MVP?

The term, minimum viable product, was first Shakespeare by Frank Robinson in 2001. However, it gained its ‘viral’ status after Eric Ries used the concept in his bestseller book, ‘The Lean Startup.’

But what does it mean?

A minimum viable product is the simplest version of any software.

While this may make sense to a developer, some customers often misconstrue it to mean a product with no good features. And this misinterpretation has led to much confusion around the term.

Our favorite way to explain this to our worried clients is how Henry Knieberg, a Lean/Agile coach and consultant, often clarifies using this sketch:

app development

                                           The first panel shows what an MVP is not.

If a customer requests a vehicle, the minimum viable product will NOT be a tire. Instead, it will be something that solves their underlining problem. In this case, they want a product to get them from one place to another. And a skateboard is the simplest version of the product that fulfills the need. However, it will not be the end-all solution. There will be multiple iterations based on user feedback to reach a software the audience loves. And this needs to be communicated to a potential client or—if you’re the developer for your business—your users.

And who knows, maybe your audience will be much happier with the third or fourth iteration! You will then have saved the time to develop a five-level product user may have rejected.

We have seen this in many cases—consumers providing feedback that never came up in your extensive audience pain points research. And it’s alright. With an MVP, you can easily figure out these needs and provide a solution the customers want—without spending time and resources on your assumption of the solution.

MVP App Cost—Factors that Influence Overall Price

Now that we understand what a minimum viable product is, we’ll discuss the money aspect.

To answer the price component, this is the range you may have to spend on a minimum viable product: $30,000-$300,000.

Well, that’s a wide range, you might say. It certainly doesn’t give you an idea of what to expect when deciding the budget.

That answer is no good, you may think. And it’s true. But the reason why it’s useless is the question is wrong. No two different MVPs are the same, and neither is their cost because the pricing structure for a minimum viable product is always stacked.

Think of it this way:

You have a stack of different-sized blocks. You ask someone to build a tower of a certain height and shape for you. They do so after using some of those pieces.

Now, asking “what does an MVP app cost” is the same as asking someone, “how many blocks will it take to build a tower for me?”

Nobody knows the answer until you provide details about the kind of blocks you’ll need.

app development

Image Source

So, let’s turn the question around to something that will give you a much more useful answer—what factors influence the pricing for an MVP app development?

Let’s discuss the major factors:

1. Based on Technical Experts

Starting from the top, the first thing you need to consider before starting your project is selecting your technical experts. However, if you’re an all-rounder designer, developer, and QA expert and will work on it yourself, you can skip to the next point).

There are three options: hire freelancers, hire an in-house team, or hire a third-party team. Each has its own pricing tiers.

i. Freelancers (Cheapest Service, Dubious Quality)

Not to poop on the brilliant freelancers out there, but the only reason we’ve said “dubious” is because you can find all types of skill levels on popular freelancing sites, such as Upwork, Fiverr, and Freelancer. And even if you manage to put together a team of highly skilled professionals, you may need to collaborate with them separately. This will become increasingly difficult when project overlaps, like design-developer and developer-QA, lead to bottlenecks due to misunderstandings and reworks, ultimately leading to project delays (more on this later).

That’s said, if you think you can manage a freelance team, this is the cost breakdown:

Job Title (Freelancer) Salary/Hour
Product manager $45-$110
Android app developer $8-$60
IOS app developer $12-$60
Cross-platform app developer $11-$150
UI/UX designer $25-$125
QA specialist $17-$100
.

                                                            Data Source: Upwork

Reach out to us

Need a customized mobile application?
Get in touch for a free consultation!

Alright, time for some quick math.

Assuming a 40-hour week and a 6-month time-to-development, the total cost becomes:

$102,720 to $436,800 for MVP app development for iOS and Android,

And

$94,080 to $465,600 for cross-platform development.

So, on average, it will cost you around $274,800 to develop a minimum viable product using freelancers.

ii.  In-house (Expensive Service, Excellent Quality)

Now to the second option: hiring a team in-house.

This option removes the problems the previous one had. You can get a personally vetted team that understands your brand and can communicate project details quickly. This may seem like a great option with the bottlenecks removed, except for a few caveats.

If you have a one-time project, hiring an in-house team is not the best way to spend (read: waste) your money. However, if you’re setting up a business to provide MVP app development services, and have an unrestricted budget, then this may be the perfect solution for you. Here is the salary breakdown for a basic internal team:

Job Title (In-House) Salary/Year
Product manager $123,312
Android app developer $107,216
IOS app developer $116,220
Cross-platform app developer $98,896
UI designer $96,976
UX designer $91,430
QA specialist $96,976
.

                                                               Data Source: Builtin

Our trusty calculator (and MS Excel—we wanted to be sure) tells us your total cost for native MVP app development for Android and iOS would rack up to be $632,130/year.

However, if you have a cross-platform developer onboard instead of the native app experts, your total MVP app cost could go down to $507,590/year.

Now, assuming you create two MVPs a year to make the most of your hired resources, the price of your MVP app development will be:

  • For native app: $316,065
  • For cross-platform app: $253,795

iii. Third-party team (Affordable Service, Excellent Quality)

And for the final option: outsourcing the project to a third-party team. While this choice may not work for someone looking to set up a local team in-house, it is great for the rest.

By hiring a team, you get the benefits of the first two options—affordability and collaboration.

You will get a dedicated team, and you’ll only have to pay per project!

For pricing, you will need to have a discussion with the company you choose, as they will want to factor in other factors like your timeline and the tech stack that they will use to create your app. In most cases, they will give you a quote after assessing all these options. Every company has a different base price, so you may need to discuss this on-call.

And if you’d like to get on a short, no-obligation discovery call with the AppSocio team, please feel free to reach out to us at +1-302-597-7401, or [email protected], or drop us a quick message here.

2. Based on Timeline

Okay, there are two ways pricing matters based on the timeline:

  • If you choose a third-party team, the cost will rise based on how early you want to release your product
  • If you choose freelancers/in-house team, the cost will vary based on the number of experts you have to complete the product in a given time

The first point is quite straightforward—the more urgent your project, the higher the pricing. Easy-peasy.

For the second point, let us elaborate. If you’re working in an agile environment (which is best for maximum efficiency), a single developer and QA expert will take, say, 8 months to complete your task. If you double the number, your project can now work in iterations, and the project can be completed in 4-6 months instead.

And as we calculated previously, increasing the number of team members will add to the overall cost.

But is that necessarily a bad thing?

Maaaaybe not.

If your concern is to publish your MVP on app stores as quickly as possible, then a higher cost may be worth it.

3. Based on Technology and App Complexity

At AppSocio, we’re big believers that technology is just a tool. However, in some cases, if you use the right one for a project, you can save money.

For example, a tool like React Native or Flutter for a cross-platform MVP may save you more than, say, Bootstrap or Ionic for native MVPs.

Again, if you have a project which can be better built on the latter frameworks, then it’s not a good idea to sacrifice value for money. In short, choose the best price-to-benefit ratio whenever possible.

app development
app development

                                               Pictured: Your balanced cost-to-value ratio

Another factor (this is the last, we promise) to consider is the complexity of your minimum viable product. Your overall cost is directly proportional to the number of features in your app. If the nature of your app is inherently complex, discuss with your UI/UX experts what you can and cannot exclude in the MVP app development.

 

TLDR

Alright, a quick summary:

Average MVP app cost when hiring freelancers (basic team, cost calculated for 40-hour week, 6-month development):

  • For native app: $102,720 to $436,800
  • For cross-platform: $94,080 to $465,600

Average MVP app cost when hiring in-house team (basic team, cost calculated per year per project):

  • For native app: $632,130
  • For cross-platform: $507,590

Factors directly proportional to the cost of MVP app development:

  • The number of experts (developers, QA specialists, etc.)
  • Number of features in the app

Factors indirectly proportional to the cost of MVP app development:

Timeline—urgent apps require bigger budgets.

Factors you need to discuss with an expert to identify costs:

  • Technology stack
  • Full project details if hiring a third-party team

We hope this breakdown offers you a better insight into the pricing structure of minimum viable products. If you need cost estimations for a third-party, please talk to the experts at AppSocio today. Our teams will give you a free quote on a discussion call—no strings attached! Please send us a message here, or call us at +1-302-597-7401. You can also email us at [email protected].

Reach out to us

Need a customized mobile application?
Get in touch for a free consultation!

Author

Write A Comment