In 2007, two broke roommates, Brian Chesky and Joe Gebbia, were having a hard time paying their rent in San Francisco.
Instead of just sitting around, they came up with a clever idea. They decided to turn their living room into a temporary place for people to stay. They set up three air mattresses on the floor and advertised it as a cheap option for guests coming to a local design conference. Since all the hotels were booked, they thought they might have a good chance of getting some guests.
And they were right!
The very next day, they bought the domain airbedandbreakfast.com and, within just six days, had three guests sleeping in their living room for $80 a night.
This was the birth of their MVP—Minimum Viable Product.
Instead of spending months perfecting their idea, doing tons of research, or trying to create a flawless website, they just went for it. They launched a basic version, raw and simple. Once they saw their idea worked and customers were happy, they slowly grew the platform, adding new features and improving the experience.
Over the years, airbedandbreakfast.com evolved into Airbnb, now a global platform catering to millions of users worldwide. This is the power of launching with an MVP.
An MVP lets you start small, test your product with real users, and then build it up based on their feedback. Once you see the potential, you can scale and improve.
But don’t be fooled—it’s not as easy as it sounds. That’s where this guide comes in.
We’ll explain everything you need to know about creating a Minimum Viable Product (MVP), how to go about developing it, and the costs involved. Plus, you’ll learn strategies to help your MVP succeed.
What Is An MVP?
Think of building a house. You don’t start with the fancy furniture, smart lighting, or the perfect garden. Instead, you lay the foundation, put up walls, and install the roof. This basic structure makes sure the house is strong enough to stand. Over time, you add the things that make it better—paint, windows, furniture, and more—until it’s a fully finished home.
The same concept applies to an MVP (Minimum Viable Product). Your MVP is like the foundation of your product, the simplest version that works. It’s not flashy or perfect, but it gets the job done and gives you the chance to test your idea with real users.

In Short : An MVP (Minimum Viable Product) is the simplest version of a product that has just enough features to satisfy early users and gather feedback. It allows you to test your idea in the market and grow based on real customer input. The goal is to validate the product idea quickly, learn what works, and make informed decisions for future development.
Why MVP?
You should start with a minimum viable product (MVP) so that you can test your startup idea without spending all your money on the full version. Many successful companies, like Uber, Airbnb, and Spotify, began with an MVP.
Instead of creating their complete product right away, they started small and took small steps to develop their final product. Let’s explore why this approach works.
Test Market Demands:
An MVP lets you check if people really want your product before investing too much. It’s a way to dip your toes in the water. You can see what features customers like and which ones need work. This feedback is essential because it helps you shape your product based on actual needs rather than assumptions.
If the response is positive, you can confidently move forward. If not, you can adjust your idea or even rethink your approach based on what you’ve learned. Starting small helps you make smarter decisions and increases your chances of success in the long run.
Make Early Adopters Happy:
Every new product has some early users who try out its beta version. Your Minimum Viable Product (MVP) could be this beta version.
These users enjoy having something new to check out, even if it’s not completely finished. Your MVP should focus on the main features that solve a specific problem.
When early adopters see that you’ve carefully considered what they really want, they are more likely to embrace your product and share their feedback. Their opinions can help you improve your product and make it appealing to a wider audience.
Plus, happy early adopters often become enthusiastic supporters of your brand. Building a strong relationship with these first users can lay the groundwork for long-term loyalty and success.
Launch Working Product Faster:
Every startup or product company is in a constant race to deliver their products faster than others. By creating a Minimum Viable Product (MVP), you can reach your target audience more quickly.
Building an MVP doesn’t take a lot of time, allowing you to present something to your customers before your competitors do.
This helps them connect with your product sooner. Launching quickly also lets you test your product early and get feedback from users right away.
Reduce Risks:
Product development always comes with risks, especially when you spend money on an idea that hasn’t been tested yet. By starting with a Minimum Viable Product (MVP), you can reduce how much money you risk.
Instead of using all your resources at once, you only invest a small amount to create an MVP. This lets you test your idea with real users before fully launching it.
Using an MVP to test your idea helps you get feedback and see if there’s interest in the market without the stress of a big launch. If the feedback is good, you can confidently continue and invest more. If it’s not, you can make changes or even change your plans without losing a lot of money.
This way, you lower the chances of major failures and make better decisions as you continue developing your product.
Testing Business Model:
An MVP, or Minimum Viable Product, is a helpful tool that shows whether your business idea can succeed in the market. By launching a simpler version of your product, you can quickly see how well it connects with customers and if they are willing to buy it.
Getting feedback early on gives you important information about key parts of your business model, like pricing, target customers, and what makes your product valuable.
If customers respond positively, it means your strategy is likely meeting market demands. But if their reaction is not very enthusiastic or negative, it’s a chance to change or improve your model before you invest too many resources.
Understanding Monetization Strategy:
A monetization strategy is a plan for how you will generate revenue and ensure that your investment is worthwhile.
For example, if you’re developing a mobile app, you might first consider using in-app purchases to earn revenue. With your minimum viable product (MVP), you can test if this method works well with your users. If people are willing to pay for extra features or content, it’s a good indication that you’re on the right path.
On the other hand, if your MVP shows that users aren’t interested in spending money this way, you have the opportunity to change your approach. You can look into other options, like subscription plans or earning money through ads, to find out which one works better for your target audience.
MVP Development Roadmap
Before launching your final product, it’s important to create a Minimum Viable Product (MVP). But you might be wondering, where do you begin? There are several steps to follow when planning for MVP development.
Even if you’re working with a company that specializes in developing MVPs, it’s essential to understand each part of the process.
Here, we will break down the steps for planning MVP development in a way that is easy to understand.
Step 1 – Market Research:
Nearly 42% of startups failed because they didn’t do enough market research.
To start making MVP, you first need to do thorough market research. This means you have to understand your target audience and check if there’s any competition out there.
What Problem Will Your Product Solve?
Think about the problem your product is going to solve. Look for a gap in the market that your product can fill. This will give you important information about the issue you want to address with your future product and its MVP.
Who Is Your Ideal User?
No matter what business you’re in, it’s crucial to have a clear idea of who your buyers are. The same goes for developing your MVP. You need to know who your future customers will be to gather better insights.
Is There a Market Need?
Conduct surveys with your target audience to find out if they really need your product idea. Ask them questions about the problem and whether they want a solution, or if they are happy with what they currently have.
What Are Your Competitors Doing?
Research your competitors to see what makes their products successful. Find out if they have specific strategies that help them stand out.
What Makes Your Product Unique?
If there are already products that solve the problems you’re targeting, it’s important to understand what makes your product different. This knowledge will help you prioritize features as you move forward with developing your MVP.
Step 2 – Define User Flow:
The next step in MVP development is to define the user flow or user journey. This means you need to think about how users will use your product and the different steps they will take. Look at your product from the users’ point of view and outline their journey. To define the user flow, start by listing the stages that users will go through.

For example, in a hotel booking app like Airbnb, the stages might include searching for available places to stay, picking a property, checking out the details and features, entering check-in and check-out dates, using any discount codes they have, choosing a payment method, and confirming their booking.
Depending on your product idea or business model, you should think about what steps your users want to take. It’s also important to identify the final action they want to accomplish, which is the main goal of your product.
Step 3 – Prioritizing Product Features
The third step of your MVP development is to make a list of all the features you want and decide which ones are the most important. For each part of the user flow that you outlined in the last step, start writing down the features you think would be useful.
Since we’re focusing on your MVP, it’s time to prioritize your features. You should ask yourself two key questions:
- Which features are absolutely necessary for the main tasks?
- Which features can be considered extras?
Once you have answers to these questions, you can divide your features into two groups: ‘must-have’ and ‘not necessary.’ You should also rank them based on priority: high, medium, or low. You could organize them in a simple chart.
Another way to prioritize your features is to think about how much impact they will have on your MVP and how urgently they need to be included.
For example, if you’re building an e-commerce website, having a payment option is essential. This feature is very urgent and must be part of your MVP.
However, some features might seem urgent but won’t significantly impact how your MVP works. You can evaluate those features and decide if they should be included now or saved for a future update.
Using a chart like the one below can help you sort your features in the way we discussed.

Step 4 – MVP Development
The easiest and most cost-effective way to create your MVP is to work with a company that specializes in MVP development. They have the skills and experience to get better results than you might on your own.
While you develop your MVP, remember that it should meet the needs of your early users. It should do what they expect and even surprise them in a good way so they keep coming back.
Let’s look at some different ways you can create your MVP:
- No-Product MVP: This approach means you don’t create a real product yet; instead, you just visualize your idea.
- Product-Mockup: This is the typical way to launch an MVP. You start with a basic version of your product without advanced technologies, and you can add those later, like Machine Learning or blockchain.
- Single-Feature MVP: This type of MVP only has one main feature that you launch.
- MLP (Minimum Lovable Product): This version is designed to really impress your target audience by providing a great user experience.
- EVP (Exceptional Viable Product): This is very close to the final version of your product and aims to gain quick recognition.
- Prototype: This is a simple model of your product that doesn’t include any features. It serves as a starting point for your MVP.
Once you decide which approach you want to take for your MVP, you can either find a reliable MVP development company or gather a team of developers to help build your product prototype.
Step 5 – Track Feedback & Measure
Measuring the performance of your prototype is very important when developing a Minimum Viable Product (MVP). After you’ve created your MVP, you should work on improving it into a minimum marketable product. Once it’s released to your first users, you must pay close attention to their feedback and see how they use the product.
It’s essential to review everything your customers say about your MVP. However, just gathering feedback isn’t enough.
You also need to observe their actions and the success of the MVP to determine if you can move forward with new versions or if you need to adjust your business plan.
Measuring MVP Success
When you want to see how successful your Minimum Viable Product (MVP) is, there are several important factors to consider. Analyzing how well your product is doing can give you insights into its future potential. Here are some effective ways to measure the success of your MVP.
Feedback:
The first thing you should do after launching your MVP is to gather feedback. It’s important to hear from both Alpha testers (like family and friends) and Beta testers (the early users). You can interview customers to understand their experiences, any issues they faced, and what they wish to see in the future.
Engagement:
Another key factor to measure success is how users engage with your product. Check how long they spend on it, how many clicks they make, and what features keep them interested or drive them away.
Net Promoter Score (NPS):
NPS is a useful survey tool to gauge the overall success of your MVP. You can use feedback apps to ask users if they would recommend your product to others or rate their experience. This score ranges from 0 to 10 and helps you understand how much users enjoy your MVP and if they would suggest it to their friends.
Active Users:
You can track the number of daily active users (DAU) and monthly active users (MAU) to see how successful your MVP is. If the number of active users is increasing, it means your MVP is engaging them; if it’s decreasing, it might be turning them away.
Average Revenue Per User (ARPU):
This metric shows how much money your company makes on average from each user. By knowing this number, you can tell if your product is making a profit or losing money.
Sign-Ups:
The number of sign-ups is another important measure of your MVP’s success. More sign-ups indicate that users are finding value in your product and are interested in using it.
Customer Acquisition Cost (CAC):
This is how much you spend to gain a single customer. You can calculate it by dividing the total money spent on attracting customers by the number of new customers.
If the revenue you make from each user is less than what you spend to acquire them, your MVP isn’t profitable and you may need to change your strategy. If it’s the other way around, then you’re on the right track!
Churn Rate:
Finally, you should look at the churn rate, which measures how many customers stop using your product. A high churn rate can tell you a lot about why your MVP might not be succeeding.
Cost Of Building MVP
Here’s a breakdown of the costs involved in building a Minimum Viable Product (MVP):
Hiring Developers/Teams/Companies
The first expense you’ll face when planning to create an MVP is hiring the builders, which could be developers, a development team, or a development company. You can choose any of these options depending on how much money you can spend and how complicated your MVP will be. Just remember that each choice comes with its own costs.
- If you decide to hire a remote developer, the average cost for their services to build a solid MVP is around $15,000 to $20,000.
- If you choose to outsource your MVP development to a place like India, you might get a great MVP on the first try for around $30,000 to $50,000. This price usually covers everything from brainstorming ideas and doing research to actual building and launching of the product.
- Another option is to assemble a team of developers, designers, testers, and others to work on your MVP. Outsourcing the product development while working with the same company can save you money in the long run.
Design Costs
The next cost to consider when building your MVP is the design. Although the MVP should be a simple version of the final product, it still needs to impress early users. The user interface (UI) and user experience (UX) should be easy to use, yet engaging.
This involves planning, making wireframes, and creating a mockup of the MVP. Overall, this could cost around $500 or more for wireframing and between $500 and $1,000 for the mockup.

If your MVP is more complex, it will need more interactions in the design, which will raise the price. Also, adding extra screens to your MVP will increase costs since each screen needs to be designed individually.
Features and Complexity
The next important factor that affects MVP development costs is complexity. Generally, an MVP is meant to be the simplest version of a product. However, if your product is more complicated, you might need to include more features in the first version.
As mentioned before, you can prioritize which features to include by discussing with the development company or remote developers. Aim to focus on the essential features and maybe one or two extra features in the first version.
Be careful that the features you choose don’t take too long to develop. The longer it takes to build the features, the more expensive the development will be. Also, more screens in your MVP will increase the cost as well.
Technology Used for MVP
One important factor that affects the cost of building your minimum viable product (MVP) is the technology you’ll use. If you work with a company that specializes in MVP development, they can help you choose the right technology.
But if you’re hiring freelance developers or planning to build the MVP yourself, you might need advice from an expert to pick the best tools.
Choosing the right tech stack for your MVP is a key step. You can select from options like MEAN/MERN stack, PHP, Laravel, Meteor, Django, Python, Ruby on Rails, and more, depending on the features and complexity of your product. Developers for each of these technologies can charge different prices.
Time Taken
Time is very important when creating an MVP. One reason people choose to start with an MVP is because it can be built quickly. The faster your MVP is made, the more successful it can be. It’s better to work with a company that has more developers and can finish the project quickly rather than one that takes a long time. Why is this important?
The reason is simple: the quicker you launch your MVP, the sooner you can test it with your first users and see a return on your investment.
You can get feedback from early users quickly and make changes for the next version. Also, launching your MVP faster means your idea is less likely to be copied, and there will be less competition while you get started.
Calculating the Cost
Overall, the cost of building an MVP depends a lot on the factors we talked about. To get a rough estimate of the cost, you can consider how many hours it will take to develop the product and the rates of the developers. If you hire an MVP development company, they can give you a more accurate estimate of the costs.
For example, if you want to create a product like Uber, the vision you have for your app will heavily impact its cost. A rough estimate for developing an Uber-like MVP could range from $45,000 to $115,000 if you hire a company to help you. The platform you choose for your app will also affect costs.
This is because an app like Uber requires many features and sections, even for an MVP. You’ll need things like a passenger page for booking rides, a passenger profile, an admin panel, a driver panel, a payment page, a rating system, geolocation, and more.
If your product is simpler, the cost of developing the MVP can be much lower.
Wrap Up
There are many stories about the benefits of developing a Minimum Viable Product (MVP). Starting with an MVP is definitely a smart choice for entrepreneurs and product companies. The advantages are endless, from giving you a strong start to helping you improve based on user feedback.
Just remember: your MVP doesn’t have to be the best version of your product; it just needs to be the simplest version that can truly please your users.