Being one of the most controversial products today, Uber is surrounded by myths about its complex realization and potential expenses.
As many other famous products, Uber started its business with developing an MVP.
That was one of the main reasons, why the app has become so profitable and successful.
What is an MVP and why it matters?
When we talk about developing an app, we should take into account a lot of issues. A product owner need not only to have a clear vision of the product, but to make sure it’s possible to implement his/her idea. Developing an MVP can become your ace in a hole.
What does MVP term stands for? An MVP is a minimum viable product. You can think of it as a shortform version of the product. Imagine that you have a product that in the long term will have a bunch of innovative features. But what is the main problem it solves?
You can develop the product that fills the gap in the market and corresponds to your main idea and customer needs. It still doesn’t have all the features you intended, but functions right. Congratulations, you have an MVP.
Then, you launch it on the market and see if users like it. If they do, that means that your product is viable and the product can be extended to its full version.
You may ask, why do I need an MVP, if I want to have all at once? The answer is simple. It is money- and time-saving. It is rather risky to spend a lot of time and money on a product that users may not like or even need.
How can I predict an MVP price?
Even being a short version of the product, an MVP still includes market research, prototyping, design, coding, marketing and sales. That is why, it is important to include their costs into the budget.
The cost of MVP development also depends on your idea, it’s complexity and technical requirements. Another issue that will affect the budget is a platform type for developing your web application.
Do you want to have both iOS and Android versions? It is a tricky question, since development for both of the platforms is more expensive. However, for an MVP it’s more than just a necessity today. Make a thorough research of your potential customers and decide on this matter beforehand.
Another issue that you should think about is your employees. Usually your must-have MVP-development team should comprise a developer, UI/UX designer, tester and project manager. It’s a minimum set that, of course, can be extended if needed.
So what is an average MVP cost?
The most important budget-influencer here is the way your product is developed. There are four main options that can be considered.
The first one is outsourcing. Since an average price for an outsource specialist in Ukraine is $30 per hour, a four-member team will cost $120 per hour. It is the best option for product owners, who want to build a high-quality product, but have a with tight budget
The second one is developing your product via local agencies. In this case, the price will be about $360 per hour. If the estimated budget makes it possible to spend more money, this option is an effective way you can choose.
The third option is to hire the freelance specialist. A poor coordination and lack of reliability may be its drawbacks. But the price is sweet, about $40 per hour.
The last option here is an in-house development, which comes with a price $80 per hour. While the price seems to be nice, you should remember that you would need to pay the specialists for the full-time job. In-house development also presupposes you would have to pay holiday and hiring costs.
So, if we take an average timing for an MVP development, which is 2 months, the benchmark prices will be:
- Outsourcing — $35 000
- Local agencies — $65 000
- Freelancers — $13 000
- In-house — $25 000
Let’s go to Uber case and see what is the cost of its MVP.
What is a cost to develop Uber like app?
The founders of Uber certainly knew how their final product should look like. Even though they didn’t expected the company to get such a revenue, they still knew it will work. Why? Because their MVP was a total success.
Since the technologies today advance extremely rapidly, there are no obstacles for you to build a new Uber-like app.
However, as a product owner, first of all, you need to focus on idea validation. What does it mean?
You need to define your potential users, their age, sex and location. Make a market research to find out if they really need your product. Have your product any advantages compared to those that already exist? Think of the features your Uber-like app needs to attract users and make your product profitable.
The initial vision of your app and the set of features you wish to implement in your MVP will affect your budget.
Let’s take a look at how Uber operates. Every trip goes through the 6-step process. They are:
- Trip Request
- Trip Confirmation
- Matching
- Ride
- Payment
- Rating
The main functions of Uber are geolocation, cashless payment and push notifications and sms. This is functions are easy to perform with the help of various iOS and Android integrations.
You must also bear in mind that Uber has three roles of a user — rider, driver and admin one. Each of them has its own features.
If we calculate the time on development an Uber-like MVP with a basic features to run the above-mentioned processes, it will be about 1500. It is easy to convert timing in monetary value.
- Outsourcing — about $45 000
- Freelancers — approximately $30 000
- In-house development — about $60 000
- Local agency — roughly $150 000
As can be seen below, the cost of developing an Uber-like MVP is not sky-high. Taking into account the ride-sharing market situation, it is now a perfect time to offer your own solution.
While Uber faces a strong competition, try to find your own spot in the market and embody your idea.
Photos courtesy of gettyimages.com
