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How to Build a Minimum Viable Product In 2022: Essential Benefits and Challenges Explained

Updated 24 May 2022

23 Min

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The modern IT industry constantly grows, providing releases every day. Though, only the strongest will live: due to lack of investments, marketing demand, or public indifference, many startups collapse, and we know only the most successful ones. So, how can you join them?

To understand what the customers need the most from your final product, primarily you should develop a minimum viable product. MVP costs less than a full-fledged solution, helping you investigate the market environment with minimum financial and time losses. Such a method has led to the success of well-known companies like Dropbox and Amazon, and it is worth considering.

A minimum viable product creation is a procedure of building a solution with a set of features enough for path-breakers to use. MVP can also help the developers to improve the product due to the customers' feedback analysis.

This very particular post will shed some more light on the process of minimum viable product software development. We’ll also give some examples of successful MVP, so stay tuned.

How to Build an MVP and What For?

An MVP building is a development process of a new product having a minimum of crucial features. It should help to identify the viability of the entire system and conduct an audience response testing.

So, how to build MVP app or website and why should you do it? First of all, you should create your future solution version with only the most critical features to meet the customers’ pains. Then, the other options can be included after obtaining a client’s review.

There’s a common deception that companies build MVP solutions to speed up time to market. But it’s more common that companies develop MVP to verify the economic viability. So, development speed can be a priority only when it comes to faster market analysis and MVP testing.

According to industry estimates, about 20% of startups get outcompeted and quickly fail. Moreover, 2/3 of startups never bring positive incomes due to various reasons. But if you come to MVP building wisely, you can avoid such failures and increase your profitability, like the globally famous companies that started their businesses by building a minimum viable product. For example, PR Newswire notes that the revenue of Twitter constantly grows, amounting to $1.19 billion in the second quarter of 2021. Likewise, Facebook’s profit was also expected to increase to $34 billion in the 4th quarter of 2021. Thus, the numbers speak for themselves and prove the necessity of MVP build for every business.

MVP Building Basic Goals

In a nutshell, MVP is mainly focused on:

  • Testing a product’s viability. Need to check whether your concept's effective but don't know where to start with? Minimum Viable Product development will be a way to make your ideas real and check their popularity among the customers. To gain this aim, start with making a feature list including there only the basic functionality to integrate.
  • Spending less money on product development. Being focused on working only with the essential product's functionality will lead to lowering operational expenditures and saving your budget funds, as a consequence. So, working upon the question "how to develop Minimum Viable Product" is especially actual in case your budget for solution development is limited.
  • Faster delivery of a product that solves one user’s problem leastwise. Working on MVP creation, your team not only minimizes time and money spendings but also strives to develop a solution to customers' problems (or at least, one of them).
Basic principles of MVP

How to build an MVP app — 3 essential principles

How to create MVP application or website and what else it is aimed for? With the help of MVP you may gather a focus group with the opportunity to use it in the further building process of your product. Minimum Viable Product also allows you to raise funds in different ways (e.g., through investors or crowdfunding platforms). When you build a MVP, it allows you even to get ahead of the competition by earlier understanding of your target audience and capturing them with your solution.

Anyway, when hiring a custom software development services, you should have a clear goal of your project.

Take your advantage from MVP

Apply to Cleveroad, and we'll give you an in-depth consultation as to the MVP building!

Developing an MVP: Benefits for Businesses

MVP development is a shield and sword of any application. It can help you both spark the interest of users, or prevent your business from suffering damage. But, let’s get through each MVP advantage one at a time.

To put it short, then we build an MVP app, we can achieve the following advantages:

  • Initial customer research
  • Testing stage
  • Cost-effectiveness
  • Possibility to attract investors
  • Reducing the development costs of the final product

We'll discuss each of them in detail below.

1. Initial Consumer Research

The sooner the product reaches end-users, the faster you will get to obtain and investigate their opinions. This way, you can study the market environment and create your MVP due to the data obtained. It is quite easy to do that because the MVP codebase is little.

On the other hand, it should be mentioned that if people get involved in your project, you will be certainly sure that the created features satisfy users’ needs, and they strive for more product updates. If something is wrong, you can scrap the project for damage reduction without great losses for your business.

2. Testing Stage

Another essential benefit of a minimum viable product software is that it lets you test the whole concept of your project. If you launch the app having a lot of different features, it will be much harder to tailor it according to the needs of a particular target audience. Moreover, you will have to get rid of the unnecessary product features you have paid for.

Developing an MVP version, you work just at the small range of features. If these features are well-received by your consumers, you can offer them new ones addressing their preferences. In this case, additional functionality will be implemented without spending much funds as it could be for a full-fledged software.

Learn more about testing - we prepared 5 best iOS testing frameworks.

3. Cost-Effectiveness

Cross-functional apps usually need lots of time and money during the development process. Though, if you build an MVP app, it may cost much less due to the incremental development. Moreover, you can reveal the product weak sides, improve it, and after obtaining profit, reinvest money for additional features building.

4. Attracting Investors

Finally, if you look for how to get funding for your startup, you can catch your investors’ interest by MVP. It’s important because the parties concerned don’t have to await the issue for too long.

People often avoid ideas that are perfect on paper but have miserable implementation. Therefore, if you make MVP, it would be the best solution in this case. This will single you out from the idea-only startup companies, and the investors would trust it.

5. Reducing the Development Costs of the Final Product

Building MVP can help you prioritize features and functions, necessary for your future product and plan your finances for the building process. Thanks to that, you can draw in the expenses needed to create the full-fledged product, launching it faster than competitors.

MVP advantages

How to build MVP wisely and what benefits to use

How to Build an MVP: Stages to Pass Through

Despite the fact MVP has a limited set of features, planning actions before development is necessary. The question is: how to create minimum viable product and where to start? So, let’s find out all the details of the MVP development process.

When you’re creating a minimum viable product, you should pass through the following steps:

  • Market Research
  • Get a Clear Idea
  • Define the Feature List
  • Build and Launch
  • Analyze the feedback

And now we’ll talk more about the listed points of the MVP process.

Market Research

Market research is the fundamental point of any prosperous project. If you don’t want to end up broke — analyze. Make sure that you'll build MVP website or app that will be interesting and helpful for users. There are a lot of additional platforms that conduct paid surveys, like SwagBucks, Onepoll, Toluna, etc. They will assist you in making up your customer’s detailed portrait. Moreover, watch out for your competitors and thoroughly investigate how they make a minimum viable product.

Get a Clear Idea

To understand how to build an MVP, every business proprietor should analyze their project, replying to the following questions:

  • What problems can my platform solve?
  • Can it be useful for the end-consumer, and how?
  • Why would they use this solution?

If all the replies are found, you’ll have a clear idea as to the principal product qualities. After defining the problems and the pain points (and their solutions), you can start making it MVP version of your future product.

Define the Feature List

While building up an MVP for a startup you definitely have to provide a software development company that will assist you, with a list of features. So write down all the desired components of your upcoming app for the planning phase.

Then, leave only the features that will be essential for creating a minimum viable product concept. MVP means that you don’t have to implement the complicated frameworks and the fancy design at once. So, take one step at a time.

Discover how to draw up a tech startup business plan that will help you in an upcoming product development in this guide.

Build and Launch

After all the criterias’ arrangement, you can start building your MVP. So, how to create a minimum viable product that will be prosperous and attractive both for users and investors? Remember: you should strike a happy medium to receive a professional and concise product.

Your MVP shouldn’t be functionally overloaded. At the same time, it should be qualitative, with every bug fixed at its proper time to avoid failure from the very beginning. Moreover, it must attract the customers by its ease and solve their fundamental problems.

Analyze the Feedback

How to do MVP in such a way as to obtain positive feedback? It is essential in the process of MVP development. Using it, you can draw your own conclusions about the other features to develop or a bug search. Thus, the early users will serve both as idea creators and testers for your MVP.

How to build MVP

5 steps to build an MVP

Building an MVP, remember the most important rule: you should develop a well-balanced product according to your customers’ desires. Then you can continue the development flow and add more functionality based on received feedback from the first users and collected analytical data.

Moreover, be ready to making constant improvements and upgrades to the launched MVP in order to make it the most relevant for your chosen market.

Order an efficient MVP

Our professionals are eager to create a profitable MVP and turn it into a full-fledged product!

Creating an MVP: How Much Does It Cost?

So, we studied how to build your MVP solution. And now it’s time to define the prices for the minimum viable product development as well as its timing. Cleveroad provides app development services in different spheres, and travel and hospitality is one of them. Thus, we’ll discuss minimum viable product costs on the example of a hotel booking app.

Bear in mind: cost and time estimation is rough, depending on the uniqueness of every app, even in the case of features similarity. To get more accurate information, contact us for free.

Firstly, we estimated the development time of MVP essential features for both Android and iOS. The results of such evaluations are presented below.

The Main MVP Characteristics for Both Android and iOS

ModuleEssential MVP featuresFrontend (iOS&Android)Backend

Login screen

Login through Facebook

Login through email (+ password)

Logout

Forgot password?

70h

22h

Register screen

Terms and Policy screen

Registration via email+password

26h

5h

Favorites screen

List of rooms

30h

10h

Search screen

Search and offerings

Date settings

The number of visitors

List of rooms

260h

88h

Profile screen

Settings

Payments

Feedback

Profile editing

136h

49h

Message screen

List of messages received

Message archive

Dialogue details

264h

89h

Trips screen

Future trips list

42h

15h

Order screen

Card payment

76h

27h

Proprietor features

Ads screen building

Query management

322h

85h

GPS location

GPS

40h

Push notifications

Notifications

28h

16h

Total development timing

1294h

406h

Moreover, all the hotel booking apps should have a thoroughly developed admin panel to comfort run the application. So the timing for build it is the following:

Time Estimations for Admin Panel Development

ModuleEssential MVP featuresFrontendBackend

Authorization screen

Sign up/sign out

4h

3h

Rooms management

Managing rooms

38h

35h

Visitors management

Managing visitors

41h

38h

Reports management

Managing reports

15h

20h

Categories management

Managing categories

16h

10h

Total time for development

114h

106h

So, we listed the approximate MVP features timing necessary to develop a minimum viable product for the hotel booking platform. In common, the programmers need about 1920 hours to make an MVP app version both for iOS and Android.

If we divide this time into sprints, we’ll have 9 development iterations. However, keep in mind that the programmers are not the only ones that would participate in your project. Your team should also contain frontend and backend developers, QA engineers, designers, business analysts, project managers, DevOps specialists, and team lead. This way, the questions on how to make minimum viable product and how to design MVP will be fully solved.

Thus, regarding the workflow details and team composition, the rough price will be $159,175 for such a complex product. Rendering development services, we can also guarantee on-time delivery of the built products if all the specialists are necessary for the creation process.

Unsure about a start point?

Obtain a project evaluation and professional consultation from an experienced IT vendor.

MVP Building Passed Successfully: Famous Examples

This section will provide you with prominent MVP examples. These well-known startups founders that turned their companies into famous ones worldwide can teach business proprietors a lot. They definitely know how to make an MVP app and turn it into a successful business.

Airbnb

This history dates back to 2007 when two San-Francisco men wanted to establish their business, being on a tight budget. Once, there was a design conference in their town, so they decided to rent out the top floor of their apartment to visitors with no rooms at the hotels.

How to develop a minimum viable product in this situation? They made up a basic landing page with their housing pictures on it. Three primary clients came first and rented the rooms during the conference.

Brian Chesky

Brian Chesky

Airbnb, Inc. CEO

I'm not saying the whole world will work this way, but with Airbnb, people are sleeping in other people's homes and other people's beds. So there's a level of trust necessary to participate that's different from an eBay or Facebook.

The entrepreneurs defined their target audience and confirmed their concept viability thanks to communication with guests and the MVP marketplace. As a result, the Airbnb platform for short-term housing rent appeared.

Today Airbnb is a commercially successful project that earned $887 million profit in the first quarter of 2021. Visitors reserved 64.4 million nights and experiences, which is 13% more than last year.

Focused on hospitality and travel? A guide on concierge app development will help you stay on top of e-travel trends. Look through it!

Buffer

Wasting time for useless products that the target audience wouldn’t accept? That’s what Joel Gascoigne thought about when he developed Buffer. He decided to build "a super minimal product"; that's why, instead of product development, he prepared a webpage containing a product description, some plans for subscription and shared it in Twitter.

Joel Gascoigne

Joel Gascoigne

Co-founder and CEO of Buffer

It starts with the company’s purpose and values, which serve to attract and inspire the right team members. This leads to innovation and superior customer service, which then leads to improved market share and higher revenues, profits, and eventually shareholder value.

After efforts to subscribe, the customers obtained an email stating about the product unavailability and offered to monitor the building process. This way, the question of how to create MVP obtained a wise solution. The subscription page assisted Joel in setting up a connection with the target users and making a base of subscribers for the upcoming product. Moreover, he understood the share of traffic that is ready to pay.

buffer first ui/ux

Example of MVP by Buffer

From the MVP version, Buffer changed into a solution for social network management that entered 2021 with over $21 million of revenue thanks to ​​29,632 customers invested in it.

Twitter

After being defeated on the audio/video marketplace due to the concurrency with iTunes, Odeo had to launch a completely new product. It was a microblogging solution, which was named “twttr”.

Jack Dorsey

Jack Dorsey

Twitter Inc. CEO

Make every detail perfect and limit the number of details to perfect.

In the beginning, the platform served as an inside service for Odeo employees. It also enjoyed team acclaim, and they decided to make it open to the public. Though, a future social network didn’t gain popularity at once. New followers joined the project after the SXSW conference in 2007. And nowadays, Twitter is the great example of how to create a social media website. In the second quarter of 2021, the platform generated $1,190 million in revenue.

twitter first landing

The very first design of twitter.com

Pebble

Pebble is known for the launch of smart-watch ancestors — e-paper watches.

Company founder, Eric Migicovksky, established the most efficient Kickstarter campaign of all time. The total investment amount was up to $10,000,000. Eric attracted the audience with a video demonstrating an MVP version of his upcoming project. This way, he asked for funds. In a 2 hours period, $1 million was gathered. By the end of the first week, there was $600,000 on a project’s bank account. At the end of the investment round, the total amount figured up to $10,200,000. Unfortunately, this project was out of business and then changed, joining Fitbit.

top-6 mvp examples

Additional MVP Examples

We gave you some well-known examples of when the founders knew how to create MVP website or other kind of products. Then, realizing the worthiness of their ideas, they could turn it into a full-fledged business project.

MVP Implementation Drawbacks

Building an MVP, you should clearly understand that you cannot rise your minimum viable product without considering the hidden pitfalls. So, let’s answer on how to create an MVP solving the widespread development issues.

Incorrect priorities

Before you stop the car, you should know why you do it, and how. The same thing is with the MVP built. Moreover, the absence of the goals defined, or focus on the wrong problem solution will lead to negative consequences, such as your product wouldn’t attract customers or even pass the concept testing.

To solve this problem, you should firstly formulate your product concept as accurately as possible. This way, you'll have an understanding of what issue you're going to solve creating an MVP, and what solution the defined problem will need.

Defining the details of the future solution, answer the following questions:

  • How relevant your problem is?
  • How does the market solve it?
  • What functionality will make your app unique among the others?

If giving a proper answer is difficult, you can choose an outsourcing software development vendor to collaborate with. The vendor's business analysts will help you prove your upcoming solution's necessity.

Lack of iterations

Creating a MVP, you defined a problem, and it's great. However, you should also find solution alternatives: how to sell something that can be bought in an affordable manner.

This can be understood by research. So, you should find out the buyer persona your product will be targeted to, describe a situation you should assist in with your product, as well as compare the used helpful alternative with a solution you're going to develop. Such kind of a study will help you set the priorities and create an MVP which would be a well-planned and sustainable one.

However, keep in mind that communication with customers, sketching, brainstorming sessions, and so on shouldn't be neglected during the above-described research. Otherwise, the absence of one will harm your product.

Lack of feedback

How to build Minimum Viable Product that would be attractive and in-demand for customers? You can never understand the users’ needs and pain points without asking for their opinion and obtaining replies. What should you remember while collecting customers' feedback?

  • Your solution cannot be a so-called "magic bullet". So, working upon it, you should understand how to create a MVP for a particular market segment.
  • Don't hesitate to ask what you need gathering the early customers' feedback. At the same time, don't overload them with surveys and question blanks for not to irritate them.

How to find a perfect balance between the last two activities while creating MVP and gathering feedback? For example, you can divide customers into smaller focus groups preparing different questions for each of them. Don't forget to reward your users for the given responses concerning your MVP implementation: a month (or more) of your app's free use is one of the proper variants to do so.

Excessive functionality

When you create a MVP, such excess can lead to poor UX or annoy the customers. If the functions are poorly created and have a controversial purpose, the data quality will suffer as well as the client feedback.

Too much functionality is implemented if your case is one of the following:

  • Answering a question on how to write an MVP user story for a new piece of functionality is troublesome for you.
  • You focus on the demands of your secondary target market, forgetting about your main customer flow.
  • Your MVP backlog size has grown by more than 30% from the start.

You can consider one of the possible alternatives to solve your problem as engaging UI/UX design services on your way to find out how to write MVP feature list with enough functionality.

Late start

How to develop an MVP that won't be launched too fast or too late? Try to find a balance. Don't hurry up with a Minimum Viable Product building in order to create a solution with maximum possible features as fast as you can.

The MVP development workflow usually takes from 1 to 5 months, depending on a solution's complexity. So, build your MVP thinking out every feature's implementation to create a well-thought out product.

MVP failures reasons

How not to make a MVP - reasons for failure

How to Create MVP Product and Succeed?

After all the stages on how to create MVP product have been investigated, let’s discuss proper dealing with it. We’ve prepared a set of advice that will help you during the development workflow.

Keep a close eye on your rivals to leave them far away

How to build MVP project and achieve this aim? The IT sphere is quite competitive because the marketplaces are refilled with new apps almost daily.

That’s why you should pursue a market investigation and monitor your competitors. Learn their strategies of the product implementation, compare the information obtained. You need it to create your own exceptional experience and to give it proper embodiment for users’ needs fulfillment.

Create your buyer persona

It means you should take an opinion poll, ask the right people, and obtain information from them to create the portrait of your ideal consumer. It can contain personal information (gender, age, or marital status) as well as professional details (like position title or work issues/ways of their solutions). The buyer persona can help you create messaging and content that will be more precise for your target audience. As a result, the user’s interest in your MVP will grow.

Conduct researches

In dependence on your business size, you can have several buyer personas. So you should do the market segmentation and target audience research to reveal groups unified by common interests to impact them by your MVP.

Make up a story map

It will identify your aims and results, user stories, and tasks. This way, you’ll have a comfortable tool to analyze problems and achievements connected to the upcoming MVP.

Learn and check

The MVP launch is not the end of your workflow. You need to constantly check, learn and measure the internal MVP characteristics, which are key ones because they reflect the degree of your minimum viable product success.

Know more about the efficient actions during product creation with our article!

MVP Building: What is After?

What's the next stage after you create MVP app? If you ask yourself this way, let us tell you what is further.

Minimum Marketing Product (MMP)

You should know not only how to design an MVP, but also how to test and upgrade it properly to make it in-demand and up-to-date. These actions will help you find a way to a Minimum Marketable Product (MMP) - the first practical alternative of your current solution having limited feature set and useful for satisfying the most critical demands of your core audience. It's intended to monitor client feedback from people willing to pay for your products.

Large investment rounds are usually made at this stage in the project's development cycle whereas an MMP allows for your solution's monetization and meaningful user interactions.

However, you should understand that the MMP as well as the MVP has the flaws and drawbacks that should be worked out, as Minimum Marketable Product is also aimed for the early users of the product.

Minimum Lovable Product (MLP)

It's critical for a company to work on and construct features that are not only easy to love but also pleasing to the consumer in order to produce a minimum loveable product. It's one that people will continue to use and tell others about it if product's UX is appealing to them. 

The objective here is to produce a viable product that not only has the required functions for users, but is also enjoyable to use.

To prepare an MLP, you should start with an appealing design, taking into account the user experience, and constantly strive to generate a wow factor.

Minimum Marketable Feature (MMF)

If you need to make your solution more appealing to investors, a Minimum Marketable Feature (MMF) is ready to help you.

An MMF is a bunch of solution's features that provide value to the user. This must be a brand-new feature allowing consumers to solve their problems for less money.

MMFs increase customer loyalty, reduce expenses, and increase income for the company. Users want it to have a feature that solves their problems and alleviates pain points faster, in a more efficient manner, and that functions as a supplement to the primary product's capabilities.

KPIs to Control After MVP Launch

After your MVP is ready, there's no spare time to relax. In order to successfully answer a question on how to make MVP, MMP, MLP or add MMF to your product and make it finally a full-fledged product, you should monitor popular key performance indicators (KPIs). They might assist you in determining your app's success upon launch.

Below we'll enlist some of the most prominent KPIs you should pay your attention to answering questions like how to make a MVP and how to help it remain popular.

The retention rate means the percentage of recurring visitors demonstrating the originality of your concept. Simply put, it shows whether your MVP offers something unique that no one else does, causing customers to return to your service again.

Activation rate. Its purpose is to illustrate the customers' impression from your created Minimum Viable Product. You may understand that everything is ok with your product in case your users actively apply to it, read your materials and fill in the contact forms intended.

The churn rate depends on the percent of customers that can quit using your MVP software or delete it entirely. This KPI should be checked to ensure that your MVP is free of obvious defects and is regularly gaining new users.

The net promoter score (NPS) is an approach to assess the performance of an MVP and emphasize users' opinions on it.

The customer acquisition (CAC) allows you to calculate the budget required to obtain enough clients while creating a product.

You can also check a monthly average revenue per customer, lifetime value or other KPIs to make your product successful on its way from creating a concept and make it MVP with only the vital features to a full-fledged and popular product.

All that can be done by your own, but if you pass this way choosing an offshore outsourcing software development vendor who can make your solution beneficial and profitable for your business as well as interesting for customers, it will simplify your job and change your product to better.

Gain perfect KPIs working on MVP

The competent IT vendor is ready to help you upgrade your MVP according to your business needs

How to Create an MVP: Cleveroad Experience

Cleveroad is a qualified outsourcing software development company with headquarters in Estonia. We've been assisting startups and organizations of all kinds in acquiring cutting-edge technology for 10+ years. We specialize in a wide range of IT services and bespoke software solutions. They improve workflow efficiency, address business issues, and aid in the acquisition of competitive advantages.

The benefits from collaboration with us include (but are not limited to):

  • A complimentary consultation with our Business Analysts about your project
  • Services available on demand: MVP creation, software development from scratch, maintenance, and legacy system modernization
  • Supervision and control of product quality at all stages
  • Innovative building approaches and a cutting-edge technology stack
  • Teams of agile-minded, highly trained, and certified IT specialists
  • A comprehensive consultation with one of our Project Managers

We are well-acquainted with the question of how to make a minimum viable product. One of our last projects was Ayoo dance — a social net connecting dancers. We developed an MVP at first and checked users’ favorable feedback. Later this application turned into a full-fledged social network service, also available for iOS.

Ayoo dance is a global community for dancers that allows them to spend time joyfully and profitably. This way, the dancers chat with soulmates and learn new moves or styles. We utilized different technologies like Facebook SDK for integrating logging in via Facebook, Swift for iOS development, and Node.js for the backend. Learn more in our case study.

ayoo social net

The Ayoo application

MVP creation is more about the strategy and analysis rather than complicated product development. Remember, if you wonder how to develop MVP, such stages as concept building, choice of an MVP development company, testing, and prototyping should be taken very seriously.

Build a successful MVP with us

Cleveroad IT experts are ready to assist you in creating your perfect product from scratch

Frequently Asked Questions

To define your MVP development cost, you should be based on your business aims and project requirements.

We build an MVP app according to development stages below:

  • Do the market research
  • Conduct the requirement analysis
  • Get a clear idea of MVP
  • Define the feature list
  • Build and launch an app
  • Analyze the feedback on MVP and full-fledged app

Briefly, MVP is focused on the following:

  • Low-cost viability testing of a product.
  • Low-cost product development.
  • Faster delivery of a product that solves one customer’s problem leastwise.

A minimum viable product includes only the essential features that will solve the customers’ pains and problems. Everything else can be developed after analyzing customers’ reviews.

The vast majority of startups collapse because the market doesn’t need them. To completely understand what the customers need from your final product, you should develop a minimum viable product. MVP costs less than a full-fledged product and helps you investigate the market situation. Minimum viable product creation led such companies as Dropbox or Amazon to success.

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