How to Develop an MVP: Steps, Costs, and Success Factors

Let’s be honest — in business it’s not enough to simply come up with an idea. You need to quickly understand whether it actually makes sense. That’s where MVP, a Minimum Viable Product, comes into play. It’s not just a trendy buzzword but a practical tool that helps save time, money, and energy. Put simply, an MVP is a basic version of a product that already works but includes only the most essential features. It’s launched to test assumptions and find out if what you’re building is something people really need.

There’s no shortage of successful MVP examples. Take a look at global cases — Airbnb started as a simple website with just a few apartment photos in San Francisco, while Dropbox began with nothing more than a video demo that showcased the concept. And that was enough to spark user interest.

What Does the MVP Concept Mean?

The term Minimum Viable Product (MVP) became popular thanks to Eric Ries and his book The Lean Startup. The idea is simple yet powerful — build the smallest possible version of a product that still works and delivers real value to users.

In other words, an MVP is not the same as a traditional prototype. A prototype might not function at all and only demonstrate the concept. An MVP, however, is a working product that provides actual value to customers, even if in a limited way. This makes it a crucial step in product validation and one of the smartest strategies for startups and businesses aiming to reduce risks, save resources, and test their ideas in the market.

The key components of a minimum viable product.

The main goal of an MVP is to test a hypothesis. For example, let’s say you believe people need an app for quickly choosing healthy meals. Instead of immediately investing in a complex system with thousands of recipes, you build a simple app with just 10 dishes and an option to order delivery. If users actively engage with it, you move forward. If not, you adjust your approach or shut down the idea — while still saving your budget and valuable resources.

Types of MVP

Let’s start with classic MVPs. First is the Concierge MVP — an approach where everything appears automated on the surface, but behind the scenes, processes are handled manually by people. The idea is simple – instead of building an expensive backend, you manually process requests from your first users. Why do this? Early on, the focus is not on engineering scale but on testing user demand and behavior. Imagine a startup promising personalized clothing recommendations. Instead of a complex algorithm, you personally consult clients and manually deliver the selections. It’s cheap, fast, and provides valuable insights.

🟢 Pros: fast launch, low initial costs, and the ability to learn from real user scenarios.
🔴 Cons: harder to scale, risk of false conclusions if manual work differs significantly from automated processes.
This type of MVP is used when the goal is to validate the value of the service rather than the technical implementation.

Next is the Wizard of Oz MVP — a similar idea, but more hidden. The client thinks the service is automated, while behind the scenes, a human is actually handling it. This approach is useful when you want to test market reactions to an interface or concept without revealing that everything is done manually. For example, a chatbot that responds instantly, but in the beginning, a human operator prepares the answers. This method allows you to quickly test user scenarios and communication tone.

🟢 Pros: realistic user experience, ability to adjust processes on the fly.
🔴 Cons: ethical considerations, need for transparency at later stages, labor-intensive.

Next, the Landing Page MVP is a classic tool to test demand before product development. A simple page is created featuring the product description, key benefits, and a call-to-action (signup, waiting list, pre-order). Analytics, A/B testing of offers, and basic contact forms are often added. If the page generates traffic and conversions, it’s a strong signal to move forward.

🟢 Pros: minimal costs, speed, ease of measurement.
🔴 Cons: can be misleading, as clicks do not always indicate readiness to pay.

Finally, Prototypes / Interactive Mockups are visual or interactive models of the product that show users how it will work. Prototypes can be low-fidelity (sketches) or high-fidelity (interactive mockups in Figma or other tools). They provide a quick way to test UX and enable smooth communication between designers and clients.

Cons: they don’t always reveal true technical limitations or system performance. There’s often a false impression that the product is ready for scaling, even though it’s not.

Key MVP types explained.

Product MVPs

These include:

Single-Feature Apps – a real application that does one key thing very well. Examples include a table booking app or a tool that sends one type of notification. This approach allows you to quickly enter the market, gather usage metrics, and understand whether users value the core feature.

Pros: focus on one outcome, fast deployment, simplified support
Cons: limited value for users, risk that the single feature alone won’t retain customers

Simplified SaaS Solutions – a minimal version of a service with a basic set of features that solve the main customer problem. For example, instead of a full CRM, you create only a lead tracking module. This approach allows you to test subscription models, pricing, and user willingness to pay.

Pros: immediate monetization potential, testing the business model
Cons: if the product is too stripped-down, customers may not see its value

Hardware Pilot Versions – for hardware solutions, an MVP can be a prototype device with a limited set of sensors or functions. Instead of mass production, a few prototypes are built for field testing. It’s expensive but allows you to identify hardware issues before making major investments.

Pros: real-world testing, quick identification of system flaws
Cons: high prototyping cost, logistical challenges in testing