Budgeting and planning your first digital product

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Whether it’s new product for mobile devices, IoT or web3, I am almost always asked one question: how much will it cost to create?

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I often get this question from entrepreneurs who know their stuff but have no experience building software. Since there is an answer for almost every situation, I have a few key points that are always helpful for business leaders considering a digital product for the first time.

Clearly define your budget

There are five main points that you should consider when designing a digital product. The first and most important is to determine how much you can afford to spend.

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You can then reframe the problem and determine how much of a working, functional digital product can be created with that budget and how long it will take.

If you’re not a tech entrepreneur and don’t know where to start, you can look at some typical sample ranges. Budgets and time frames for new end-user software products tend to fall into one of several categories.

Start by determining how much you can spend on product development.

Budget range Comments Time limit
<25,000 USD Do it yourself; non commercial budget highly variable
$25,000–$50,000 Bootstrap for Prototype, Slider or MVP 8-12 weeks
$50,000–$100,000 Functional minimum viable product 12-26 weeks
$100,000–$250,000 Funded Development < 6 months
$250,000–$1,000,000 Large-scale project for big innovations 6-12 months

Many variables affect these product development costs. Costs can vary greatly depending on the extent to which pre-built components or middleware can be used, how stringent security or compliance requirements are, and the variety of users or use cases the product must support.

While you don’t need to learn how to code, you should strive to understand how design, technology, and development interact.

Establishing your group will facilitate dialogue with your financial and internal stakeholders and will also help you select the right software development partner if you choose to outsource.

Budget with the priority of achieving the required business result

Equally important is the question of what your project should achieve. Check with your development partner about the goals of the project. For example, it could be:

  • Prototype for demonstration to investors who can invest capital.
  • Proof of concept for getting commitments from potential clients.
  • A minimum viable product (MVP) that can be tested by customers for feedback.
  • A production grade product capable of scaling your user base.

We worked with an engineering consulting company that had a software idea for HR. Their owner was not a software specialist, and the initial capital of the company was limited. We formed a project plan that included research, architectural diagrams, sample screenshots, and a realistic budget to build the product.

The result was a professional PowerPoint presentation that helped the company secure funding to build the first full version of the SaaS platform. For less than $50,000, the entrepreneur was able to achieve his goals without looking at a single line of code.

Credit: techcrunch.com /

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