Why estimates go wrong
The main reason is requirement uncertainty. The earlier you ask for a price, the wider the cone of uncertainty.
What an estimate consists of
- Discovery and architecture — 10–15%
- Design — 10–20%
- Development — 50–60%
- QA — 10–15%
- Management and DevOps — 10%
Fixed price or T&M?
Fixed price suits small projects with clear requirements. For products that will keep evolving, Time & Materials with a per-sprint budget cap is fairer.
FAQ
How much does an MVP cost?
Typically 15,000 to 40,000 USD depending on roles and integrations.
Can we reduce the budget?
Yes: trim the first release, reuse ready-made components and managed cloud services.