Denis Grankin Head of Sales Department

How to create a Minimum Viable Product: Stages, Benefits for a Business, Examples [Comprehensive Guide]

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build an MVP

Let's imagine a situation: you have an idea of your future successful product, but you have no idea how to implement it or don't know whether this product will be in demand after implementation or not. However, it's not imagination but reality. Then all you need now is to launch MVP to check the viability of the product. What is an MVP in business language? To be precise, it is all about business benefits, such as saving money and time.

There aren't too many people who preferred to fail after release, right? But bad things happen. According to statistics, 9 out of 10 startups fail because of spending money too quickly. The reasons why it happens can be different: incorrectly calculated development costs, sophisticated design, too many improvements, inconsistent marketing approach. But the most annoying thing is that an unnecessary product was developed. That’s why you need to begin with a minimum viable product (MVP) that will help you to avoid failure.

Let's figure out what is an MVP in software development. But before we start, it is important to know what steps you should take to develop a minimum viable product: detailed MVP project plan developing, idea testing, quick launching to the market. Companies that are aware of the MVP benefits and start up business activities quickly grow 20% faster than the rest.

What is a Minimum Viable Product?

MVP Final Product

MVP is the minimum form of the full-fledged product coming soon. It is all about proving theories about product relevance and functionality. The correct answer to the question “how to get an MVP?” is to quickly adapt to the market requirements and to develop a project that will be in demand even after a while.

Minimum Viable Product in software development means the following:

  • it is the basic model of the final product;
  • it has all the functions necessary for its work;
  • to build an MVP is not the same as to build a prototype;
  • it is a real product that needs to be developed and improved further.

Attention! We should bear in mind that an MVP is still not a product's final version, so you should focus only on the word "minimum" as a goal. The worst thing is that the MVP holders may consider their customers need the same - to build MVP website or an app without further elaboration. What a huge mistake. An MVP takes place only in the first few weeks, after that the product is becoming scalable, more functional, powerful, convenient, affordable, etc.

MVP Product Development: Features Available at the Beginning

The very first version of the product has enough functions to:

  • satisfy user requests;
  • collect reviews;
  • test the demand.

Providing users with an MVP, we sell them the concept. After project mistakes and errors are fixed, you can replace the MVP with the end-product. Below you can find more information about why you should start small and what are the business benefits of quick launch.

Bring focus on the main Business Benefits of MVP Product Development

Costs minimization. The MVP product development implies setting only basic functions in the shortest possible time, taking a minimal risk at each stage. The minimum budget spent on development is the icing on the cake. And lo and behold, within a short period, you can create a viable product, immediately launch it and, at the same time, start modifying it, rather than wait for years until the ideal version of the product is ready.

Understanding why and where demand is headed. The launch of MVP will show what exactly the audience wants. You can change the product by changing MVP features, or, based on received feedback, even to abandon it or focus on another target audience.

Optimization of cooperation with expensive/sought after developers. Hadn’t you better to outline the minimum volume of tasks to achieve the nearest goal instead of attracting high-paid programmers to get an MVP or setting up the task list for years to come?

Build trust with customers. Thanks to MVP, there is no need to impose a finished product on users. But instead, you can demonstrate you are interested in the users’ reviews. Building an MVP you build a product together. In this way, trusting relationships can be developed for years to come, turning primary users into brand advocates.

Users are more gracious to the new to the market, users forgive them mistakes being aware that their participation in product improvement makes sense for newcomers.

Scott Graffius

Timely identify significant shortcomings. Unexpected malfunctions may occur during the product usage. It would be better to detect them earlier before competitors get ahead of you. Think about it, when the product is massive and with a high load, it is more difficult to make modifications online.

Gather a user base in the early development stages. As practice shows:

  • the sooner you make a stand on the market, the faster audience gets to know you;
  • the longer you are in the public eye, the more attention of the loyal audience you attract.

Cooperating with thematic-related media is useful before the product is ready. Think about the interview on behalf of the Founder, write demand-driven articles.

Partnership, investment. You may not be interested in such cooperation at this moment. But what if your MVP catches the eye of profitable partners or investors? It is obvious to experienced entrepreneurs what are the business benefits of MVP product development. Their participation can be vital for you.

How to build an MVP

The MVP Development process consists of two stages, such as the Marketing and the Development Part.

Difficulties with MVP may occur when the key development stages are not yet clear: what to start with, when to run marketing research, what to analyze, when to stop development process... There are too many questions. Let's look at the main steps to take when creating and launching an MVP successfully.

1. Marketing stage

Sometimes it happens that your brilliant idea does not find any response not only from customers but even from colleagues.

What's more, it may turn out that market niche is already occupied, and you are on the wrong track. The reality is that almost half of the startups’ failures are related to the absence of necessity. Why so? Those solutions did not solve the users' problems.

That is why it is extremely important to carry out a detailed market research and analysis before get started.

What exactly to do:

Market Research

Do market research and figure out whether it needs your idea/product, which of the competitors already provide similar products.

Describe the product idea

Describe the product idea, express it graphically, specify what users’ problems it solves, how it differs from similar products, why people should choose it. By the way, what is the product uniqueness?

What is the MVP goal?

At this point, it would be reasonable to determine the long-term goal of the project/product. For example, you want to increase the demand for the most expensive rate in your online school by 40%. Indicate under what conditions the goal should be achieved. For instance, 50% of traffic growth, cost reduction for paid advertising channels by 30%, all changes should take place within three months.

Identify target audience

Identify your target audience, its values (how do they correlate with yours?). It is necessary to create a customer avatar, or it is much better, to create several customer avatars at once. Imagine the user and his/her needs (to become a certified specialist, having studied at a well-known online school), desires (to get more for the minimum investment of time and money), fears (technical difficulties, a multi-step registration process, need to attach a lot of bank cards, too expensive services).

Detail the product use process

Detail the product use process: what is the reason to use the product, how do you see this process. Run the test from the point of view of an ordinary user to detect and fix defects, strengthen weaknesses, or change the approach to MVP development.

Features and benefits list

The feature list of the final product should be compiled in several stages:

  • A list of all the features. When the product is created, check if all points are taken into account.
  • A list of features for each separate step on working with an app or website. Before listing these features, ask yourself the questions as well “what do users want at this stage?”, “what about this stage?”.
  • Features prioritization. Prioritize the critical features and classify them in the following format: must-have, would be nice to have, optional, not required.

Thorough function analysis and a detailed approach to prototyping the future MVP will protect you from a possible collapse. Thanks to them, you will see how will your future product function, what it can look like, what features/difficulties may arise if something is overlooked at any stage.

Some experts compare MVP with a so-called “matryoshka” doll: in the initial version of the product, there is always a smaller MVP inside, and the developers’ task is to choose the best one before moving to the next “doll.”

*Thing to know:

In pursuit of a product in demand, it may appear a deep desire to save. It makes sense if low-cost developers are far-sighted, experienced, and write code taking into account scaling and improving the product in the future. But what if they are inexpensive and inexperienced yet? It'd better avoid such a situation.

Strategy to promote your MVP

Develop a strategy to promote your MVP app/website: find web-platforms where your target audience is located and where to promote your product. The next step is to develop a marketing plan for bringing the product to the market. You need to list thematic-related, authority, budget-friendly (maybe, free of charge?) media, opinion leaders, bloggers, partners which are worthy to cooperate with.

As you can see, the marketing stage includes not only the preparatory stage before launching. It also covers strategic planning for product promotion after it is finished, a detailed analysis of the functionality, and a step-by-step instruction for use.

Reid Hoffman

2. Development stage

When user needs are clarified, and the key features of the final product are selected, it's time to move on to the development stage. You should get the very first version of your final product, but it must be high-quality and able to effectively solve the users’ queries.

So, what is an MVP in Software Development? The main concept includes the initial product development and its subsequent revision.

Build a team - assign tasks - set deadlines.

Make a decision on which specialists you need and how much you are willing to pay, appoint responsible staff, set deadlines.

Design process

The final product, or rather, its minimum viable version, should be convenient and understandable to use. Look at the product from the user view, but not from the creator.

Don’t forget that the users’ number will increase over time. Your platform should be ready for the load as well as you have to resolve the technical problems of a large number of users at the same time.

Instead of the user, go all the way from finding the right information on your platform to making an order.

Figure out:

  • What are the difficulties?
  • What questions appear?
  • What is incomprehensible?
  • How to resolve these moments?
  • How convenient and user-friendly are these paths of problem-solving?
  • What will be at the end of the user path?
  • How should a confirmed order look like?
  • How a user figures out that he/she has done everything that was required?

For each question "what does the user want?" add clarifying question "what does the user need?". For example, a user wants to quickly sign up. What does this really mean? It means that a user needs to spend 2 minutes maximum on subscribing, without spending time on additional questions, without filling out 10 mandatory forms. Don’t make a user think a lot.

Develop MVP on time or faster

This stage is devoted directly to development and monitoring. All emerging technical flaws must be caught immediately and fixed.

Run and measure product demand, analyze, and consider reviews

What to do after MVP is developed? Test it, analyze reviews, make changes. It will be an ongoing process. The user experience is constantly changing, users are becoming more demanding, they want to spend minimum efforts and time interacting with any application or site.

Any step should be logical and predictable.

The result should be quick and expected.

Give users what they want. What do users want? You got the answer to this question (right?) at the preparatory stage, doing marketing research. Check what users want, test the product, collect feedback. Do not forget that you have created a product to solve end-users' problems, not yours.

Steve Blank

Explore the behavior of active users and pay attention to numbers

  • Customer Acquisition Cost (CAC). Find out the cost of one user attracting. You should not only promote your MVP but also understand how justified your costs and marketing actions are, which channel brings the most targeted users, which channel is the most financially disadvantageous or vice versa - which one attracts the most paying customers. Cost of attracted customer = Amount of money spent on the channel/Number of attracted users.
  • Lifetime Value (LTV). Determine the Lifetime Value of the paying customer: (How long he/she used your product * how much money he/she brought) - the Cost of user attracting.

How to know you build a profitable MVP

In order not to chase rainbows, read the information described below to find out whether an MVP has the potential to succeed:

  • Interview potential customers and highlight the problems that you think your product might solve. Compare your guess-work with real customer opinions.
  • Implement subscription offers for users. Later, it will be possible to monetize it and increase coverage, product, and brand recognition.

What are the famous Minimum Valuable Product Examples?

Perhaps, you heard how these giants started their MVPs. We decided not to miss an opportunity to repeat these cases here to get you inspired. So, here is the list of the most prominent Minimum Viable Product Examples.


This taxi-call service started as an application for text-calling a car only for friends and relatives. Moreover, you can request an exclusive luxury ride, which is usually available only to wealthy people, but UberCab made its rental available to ordinary users.


Only lazy people don’t talk about Airbnb's successful MVP. We will join them. The Founders of AirBed And Breakfast - Joe Gebbia and Brian Chesky - did not start with a large-scale website as this service is known today.

They launched a hit-and-run website to invite someone from another city to spend a week or more with them in shared rental housing. The Airbnb Founders were interested in watching how guests would be open to communicating with strangers and how comfortable it would be for everyone to share a common area. As a result, they revealed that everyone was satisfied with services and rest.

To find out which one of the successful booking projects a DDI Development team built, check this page.


At the very beginning, the Buffer’s Founder posted a small landing page in the network with the email form only and the inscription “Plans and Prices”. The product was not ready, and Joel Gascoigne needed to figure out the demand. Then he updated the landing page adding specific tariff plans Paid and Free. Many users chose a paid tariff, which meant to continue product development.

Virgin Airlines

This, one of the largest airlines company in the UK, began with one plane and one route between British cities. So, where is this company now? That's right, among the best of the best. Just like Facebook.


As you remember, this global social network was created by Mark Zuckerberg as a convenient platform for communication with classmates only.

Cost of MVP

When it’s already clear what an MVP in business and software development is, it’s time to get known how much does it cost to build an MVP. The numbers fluctuate and strongly depend on the project complexity, on the number of experts involved in the development process, on how many improvements have to be done after launch.

If you have a specific or even rough idea of what you would like to start to develop in the next few months, but you have no idea about the budget you need, give us a call or email us for calculating the cost of MVP.

Bottom line

When planning to create a unique MVP and release it as quickly as possible, we recommend to keep this in mind:

  • Modern users are demanding. It's hard to surprise them because they want to use modern, intuitive, comprehensible, stylish, and simple digital solutions that would solve their problems and answer queries fast and effortlessly.
  • Developing any product is not a linear process, but a multi-stage one. It is unreal to start the process from the one stage and meet the final product reaching another one stage. There will be constant improvements, failures, users feedback, there will be many stages. It may even happen, the MVP will be completely changed or equipped with additional functionality.
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