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How to reduce costs of building MVP for startups?

Oct 19, 2021

9 minutes read

MVP development costs a lot because every software is unique, mostly built from scratch, and it brings a comparative advantage for businesses. The most crucial question for startups is the possibility of reducing MVP development costs. The first step you take in this direction is launching a minimum viable product (MVP) instead of full-fledged product development. When you build an MVP first, it allows you to test your business idea and minimize the risk of startup failure. 

How your Startup can reduce development costs for MVP?

Let’s dive into some helpful tips and tricks that help you develop a custom solution without compromising quality.

Choose the right pricing and business model

What to do first: budgeting or planning? Some projects define the budget first, trying to fix development costs but not knowing that it might be the wrong way to minimize expenses. Experts will advise you to plan everything involved in the product development thoroughly before you budget your project. 

Why seriously plan the cost of developing an MVP?

Creating a plan makes it easier to highlight the goals for the project and develop as many solutions as needed to ensure you converge on the application development that provides the most value. It allows you to focus between the development team and all project stakeholders. 

Be sure your development MVP plan is done carefully, is cost-saving, and depends on your priorities. 

For instance, if your purpose is to see if your idea is the product-market fit, time is more important than all development details. Then you can decide to build an MVP quickly, saving cost and time. In this case, you will need fewer hours for design and development, and your schedule planning will have to be done with the minimum requirements, which helps to reduce MVP development costs.

If your MVP will work and you decide to scale it in the future, be prepared for very high costs for building new features or rebuilding certain parts of the software from scratch.

Communicate properly

The crucial thing is to communicate with all the stakeholders and consider their vision and inputs on the goals. Proper communication always helps to define the exact problem your software is intended to solve. After you have determined the problem, look for the best ways to solve it. Before starting MVP development, make sure you know the exact description of your software and its purpose for customers and the industry. 

In your plan, you have to break down big goals into smaller tasks and estimate the time and reduce MVP development cost. It is the proven way to a realistic timeline and costs for your MVP project.

Launch product with essential features

Another critical step to reduce MVP development costs is prioritizing the by putting essential features first and additional that are just “nice to have” back in the product backlog. Defining properly and early a set of functional software features will help reduce your MVP development costs as well. 

Always try to find the balance between planning and over-planning if you want the project team to remain adaptable and flexible to user responses, scope, and plan for smaller batches of work. Then you can better implement new stakeholder goals or changes in business processes, which helps avoid code that requires refactoring or some redundant features. All this is cost-saving as well. 

Don’t go too deep into all the details and software development requirements for the whole project, since this will take too long and might cost a lot. Too many details can stop the team from being adaptable, putting you in a difficult situation once you need to reduce your costs and change the software development requirements of your product backlog, or provide some other development changes due to user feedback halfway through. 

Launching a product with minimum functionality based on essential software features and usability over visual impact helps reduce MVP development costs by as much as 10% to narrow and focus of the design process. You can determine later if there is a demand in the market for those additional features. Avoiding complex and expensive software components that will not provide value to users can be critical for keeping the development costs in check.

Document the requirements 

Ensure that the software developers understand your requirements, documenting them because words can easily be misinterpreted or forgotten. You need to create a document with all your requirements and insights written down, adding everything new that comes to your mind during the MVP development process. Make it as detailed as you can to avoid any possible conjecturing that may lead to a later necessity for rework and increase your costs.

One of the best possibilities is to reduce MVP development costs by eliminating any chances of misunderstanding how you want your software to be built.

Focus on the problem, not the solution

It is always better to solve the right problem the wrong way than to solve it the right way. It means that you need to find a problem early and address it, then pay for the software development and discover something you have missed weeks earlier.

It is essential to understand your target market, how they work, what they are used to, what they like, and how to deliver this. 

Have your target users test your software frequently and give you feedback during the development. It helps you to discover problems earlier, which is always cost-saving. You can pivot the direction of your MVP earlier. 

Find the right people and the proper methodology

People are always the most expensive part of a project. Start with hiring a dedicated development team, which means finding people who cover various skill sets. 

Before the product development begins, you should ensure the development team properly understands all the requirements to avoid financial risks.

Most development teams use some Agile methodology to coordinate teamwork and establish robust programming processes. Take into consideration that it is not enough to follow every process you read online. Every development team works differently, even with Agile. Remember that you will have to constantly experiment and improve your process, not remaining rigid and falling into the same traps repeatedly.

Related: Project discovery phase: to skip or not to skip?

Make processes more efficient

If you want to reduce the software development cost, it is crucial to automate processes. Make timeframes for development as small as possible. It will reduce costs for expensive hours.

Remember that automation is not about replacing humans with computers but about creating efficiencies in your processes.

According to statistics, software testing utilizes 40%-50% of total resources and 50%-60% of the total cost of a software development project. Start with automation of testing to ensure quality and reduce MVP development cost. 

Both manual and automated testing are essential and help simplify the development, perform quality assurance testing, assist in completing tasks, prevent human error, and aid in building scripts. Try to utilize testing from the beginning of the engineering process.  

It is now possible to automate software programming with bots that code using low code and no-code platforms that utilize standard application functionality to automate coding. 

This automation allows the development team to work on the unique business offering and saves time coding common business problems.

Fixed price or good quality code?

Rewarding accurate time predictions are usually not a good idea, particularly if people behave strategically and stretch the work (lower work quality) to fit the prediction. So, if you try to get a low fixed price, it may bring you a low code quality. 

A fixed-price MVP development project may seem cheaper initially, but if a development team has to deliver software in a shorter time to meet the cost, the first thing to go will be the quality. Don’t compromise on quality! Low-quality code leads to more technical debt, and in the long term, will increase the product development effort required to bug fix, maintain and extend the project, rising costs.

Choose the right technology stack

Choosing the right tech stack for both the front and backend is significant for reducing MVP development costs.

At first, think about open-source software development tools that are mainly free to use and can be helpful by building certain parts of your software.

Look for other technologies. Remember that they have to be built or supported by trusted vendors to ensure that the tools you have chosen don’t suddenly disappear.

A third critical thought about technologies you use is the community around you. For instance, if you take JavaScript as the programming language, it won’t be a problem to find software developers to work with.

On the other hand, finding software developers won’t be more difficult and cost more if you decide on a not-so-popular programming language like Rust.

Last but not least, try to use the technologies with an ecosystem of tools with easy-to-integrate packages. If you want to build your software in the least possible time, you will have to use third-party tools so that you don’t have to create every element of your software from scratch.

Related: In-house vs outsourcing: benefits and differences

Outsource your project

If you need to reduce costs for custom software development, outsourcing is an excellent step to undertake. For example, the countries of Eastern Europe can deliver high-quality software for reasonably low prices. 

Hiring outstaff is a proven way to expand your team or complete tasks on a small project without recruiting. In this case, the success of your project and the timely delivery of the software product remains entirely your responsibility.

Outsourcing allows you to delegate the responsibility for product development and mitigation of all associated risks and set project goals for the team. This option might be more expensive than outstaffing, but it’s optimal for startups without enough product development experience. Outsourcing helps you prevent multiple mistakes, solve challenges effectively, and reduce the time to market. 

Looking for an outsourcing software development company, try to find a reliable partner capable of fulfilling the required job. Don’t forget that the lowest price might turn into poor-quality product delivery.


As companies drive the business forward with exciting software development, adapting technologies and methodologies to reduce expenses. Embracing best practices and lean product development cost-saving practices also helps in evaluating the time and budget. Communication and trust will make further development of your released software solution much smoother and more accessible, ensuring the continuous extension of functionality without hurting the quality or making your budget bloat.

Looking for a partner who can help you to reduce MVP development cost? Contact our experts, they are always here to help!

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