How To Calculate The Real Cost Of MVP For Your Startup?


This blog contains information, which will help you through the procedure of MVP development prices. You’ll discover different kinds of MVP development, team hiring, and technology stack, as well as decisions you need to make for every step.


Calculating the actual cost of any Minimum Viable Product or MVP is very important for any development team, for which you hired a business analyst that dedicates time in getting things right.

Calculating MVP can be a challenge for anybody. It becomes an even more difficult problem when you start a development agency. What you may have wondered if the next steps after you write down everything, which you want to build as well as create the product spec?

The contemporary agile software development model discourages working with the specs as in the customary waterfall approach, the spec may take even months for writing. Then, once the development starts, the spec starts changing. However, while agile is wonderful in theory, practically, every business needs to work within the budget. Although you have sufficient cash to use, you just can’t risk the clients’ expectations. In case, you always guess that the projects will get completed within six months while they end up passing a year, after some time, no clients will desire to work with you.

Thankfully, with the time, you and your team might get a dependable process. Let’s go through the procedure of calculating the real cost of MVP development for your start-up:

Approximately Estimate Every Feature, Which is Listed in Your Product Spec

‘Approximately’ is the main keyword here. It doesn’t matter how professional and experienced software development agency you are, any estimations, which you take in this regard will be incorrect. The reason behind that is, in the project planning stages, there are so many irregular details, which you won’t get the anticipation to think about. Admit that the product’s spec is an alive draft: so as the time passes as well as you discover more about the products, your draft would change.

Besides being irregular, your estimations need to be related to each other. For instance, if you guess that a sign-up would take 5 days, then the complex crawler would take a minimum of two weeks.

If you don’t have any coding experience or don’t understand how to take estimation of the features, you need to hire a professional you can rely on to make estimates for you. You can hire a developer friend and if you don’t have any personal resources, you can hire a professional research consultant.

Remember to Feature Time Sinks in Your Calculation

While doing time estimation it needs to complete the features or project, you should not only calculate the timing it takes to complete the job. The factor of time sinks is unproductive but predictable tasks.

Based on the experience, in case, your developers are working in the office, they’ll usually spend a minimum of 25% of the time chatting, going to the bathroom, as well as sitting in the meetings. Any developer’s productivity heavily relies on the team and management processes. Without any QA engineers, the developers need 25% extra time for testing the code that they have created. In case, you are not having DevOps in the team, then developers will have to spend around 10% extra time in setting up the servers as well as deploying the codes.

Arrange Features from the Most to Least importance

Which of the features are required? You need to put the most important ones on the top of the list that will inspire you to finish the most significant features initially. You may also split all the features into parts, which are also arranged so that whenever you create a roadmap, you’re creating only the most significant parts of the most significant features.

For instance, the login screen is a requirement because the users won’t be capable of login without that. However, resetting a password is optional. You may substitute that with the ‘mail to link’ for resetting the passwords manually. This won’t be impeccable, but you don’t require perfection for the MVP development.

Double the Implementation Estimation

Whenever you start your development agency, you attach an estimate for every task, which a developer was dealing with, then record how much time that took for complete execution. After many years of working, you will learn the average difference between the estimated and the actual time required for doing something.

It means that every task as well as every project taken around two times a longer time than expected. Requirements change constantly, marketing positions change, at times, founders get a response from the early users and they choose to re-prioritize. The best way of staying stable in these situations is to understand how “off” the estimates are. After that, do your best for mitigating the risks of estimates turning even more off the path.

Therefore, when you get the list of prioritized, estimated, features, multiply the estimate by two as it’s your rough estimate for a project.

When you work your way using the procedure, take initial estimation for the number of days or hours it will take for building something, then proliferate that by hourly rates of the developers. Getting that, you’ll identify the actual cost of the MVP development.

If you are an ambitious digital businessperson or are still dreaming about making your startup, the costing of MVP development and startup consulting is the question, which has perhaps come in your mind.

How to Calculate the Real Cost of MVP for Your Startup?

Whenever you hire an in-house team or a freelancer, you need to follow the following the formula:

Number of people required X number of hourly rate X hours required

However, you need to consider all the pros as well as cons of this. In case, you make a partnership with a professional software development agency, request them to assess the cost as per your requirements and get a quote. Then, you will get genuine purposes and time estimation.

Wrapping Up

If you want to know more about it, contact us and we will evaluate the cost as well as the time needed to build your MVP.