PoC vs. Prototype vs. MVP Development: What is the Difference and What to Choose?

According to McKinsey, only 44% of IT projects bring businesses the intended benefits. Companies often struggle when implementing poorly verified ideas or failing to satisfy user demand, which is especially relevant to startup software development.

One way to avoid such project failures is by applying one of the three iterative approaches for validating the project concept, usability, and market demand – proof of concept (PoC), prototyping, and minimum viable product (MVP), respectively.

In this article, we will explore these three approaches in more detail, explain their benefits, and ideal scenarios for choosing each one.

PoC (proof of concept) is a demonstration or an experiment that checks whether the idea is feasible before full development begins.  It helps companies understand the relevance of a concept or a technology in practice. Typically oriented on technical executives and other internal stakeholders, a PoC may display a particular code, algorithm, or any other technical solution that can be developed within hours or days. It is far from being a complete product and is not tested by regular users. Instead, a PoC is often a result of developers’ experiments with particular technologies.

For example, in one of our projects, the client wanted to create a unique ML-based matching algorithm for a solution that streamlines parking lot management. Our development team created such an algorithm – an ML-based solution that automatically connects users’ smartphones with parking meters at available parking spaces. It helps a user find an available space in a parking lot and start interacting with a corresponding parking meter. Upon validating this algorithm through a proof of concept testing, we used it for developing an innovative parking management automation solution.

In most cases, PoC development is characterized by a very limited scope of work, which allows companies to minimize investment. Meanwhile, it allows the development team to define and understand the probability of the expected results before moving forward with a full-scale implementation.

The work on a proof of concept often starts with a discovery phase focused on:

• Understanding the problem that has to be solved
• Identifying PoC goals
• Outlining the key technologies that should be explored
• Defining the PoC scope
• Identifying risks
• Determining the idea’s application and ensuring stakeholder alignment. 

Proof of concept in software development allows businesses to identify the idea’s technical pitfalls before investing solid funds, time, and effort into it. For example, Gartner’s study reveals that at least 30% of generative AI (GenAI) projects will be dropped after the PoC stage by the end of 2025. Possible reasons are poor data quality, inadequate risk controls, escalating costs, or unclear business value of the idea. The situation could have been much worse if these businesses had started developing full-fledged products without first identifying the pitfalls in their projects.

A prototype is an early, simplified version of a product, system, or concept, allowing a team to visualize, test, and validate ideas before launching full-scale software development. There may be a great diversity of prototypes, ranging from sketches and wireframes to interactive and functional models. Meanwhile, the most common ones are:

• Functional prototypes that imitate one or a couple of product functions
• Display prototypes that focus on the visual aspect of a product. 

Contrary to a PoC, a prototype can be tested and verified by non-technical specialists. It is often presented to the company’s key stakeholders to secure investment for the forthcoming project stages. A prototype can also be shown to the product’s target users to understand whether the upcoming app will provide them with a pleasant user experience. 

An example of a prototype would be a clickable wireframe of a real estate app. The wireframe presents the potential app’s UI/UX design, outlining its basic functionality that could be developed if the project proceeds to further stages. 

There are several major prototyping models:

• Rapid prototyping, that aims to test specific functions and explore ideas quickly. They allow businesses to get instant feedback. If the idea is validated, businesses often start working on a brand-new product based on this idea instead of continuing to develop the given prototype.
• Evolutionary prototyping, where prototypes are developed further up to the point when they grow into an actual scalable product.
• Incremental prototyping – an approach that involves splitting the final product into stages with small, individually developed prototypes. All these prototypes can be later merged into a single product.
• Extreme prototyping aimed at maximized productivity instead of discovering all possible needs and specifications. It prioritizes fast development of a solution’s UI design. The interface is often tested with a simulated app back end that uses mock APIs that process static data, recreating the essential principles of application’s server-side operations. 

Just like a PoC, prototyping often starts with a comprehensive product discovery phase during which corresponding specialists:

• Researching the prototype’s target users
• Gathering the core requirements
• Defining the user journey
• Selecting tools for building a prototype
• Planning the iterations. 

A prototype is essential in planning a product’s UX design. It is especially important, given that companies that invest heavily in design boost their revenues and shareholder returns at nearly twice the rate of their industry counterparts. 

Overall, prototyping is an ideal way to verify both the idea and the approach to its implementation. It helps a business visualize the look of their product and define user scenarios.

An MVP (Minimum Viable Product) is a version of a product with just enough core features to satisfy early users and gather valuable feedback for future development. The primary goal of an MVP is to validate a product idea with minimal investment of time and resources while ensuring it meets basic user needs. 

Just like a proof of concept, a minimum viable product may rely on software engineering experiments. One critical difference between a PoC and an MVP is that the former merely explores a technical concept behind a specific feature while the latter examines such a feature in practice. 

An MVP takes more time and resources than a PoC or a prototype but still helps you save time, cost, and effort compared to developing a full-fledged product. A basic version of an app with its core functionality is released to the market or tested by early adopters to collect user feedback and understand the directions for further product expansion. 

The development of a minimum viable product is usually preceded by a discovery phase. Some of its critical aspects for MVP development include:

• Analyzing market
• Researching on user personas and their needs
• Defining the value proposition
• Prioritizing functionality
• Performing technical planning
• Defining the validation strategy for an MVP.

According to CB Insights, 35% of startups fail since they don’t satisfy a market need. An efficient way to understand the demands of your target users before launching a full-fledged application is to start with a minimum viable product. With such an approach, you can analyze the product’s reception and implement corrections to your software product before committing to full-scale development.

It is important to mention that PoC, prototyping, and MVP are often applied as consecutive stages on a single project. In particular, many development teams start projects with a proof of concept to ensure that the idea or a concept is feasible. If the feasibility of a technical concept is confirmed, the team can proceed with product prototype development, allowing them to visualize software and refine its design, user experience, and functionality. 

Upon approving the prototype with all the stakeholders, the team can proceed with a minimum viable product. By implementing the technology tested during the PoC stage and design concept prepared during the prototyping phase, the developers build the product’s version with its core functionality. An MVP is released to the market to analyze the demand and the reception of early adopters and plan its further development based on the results of the analysis. 

By combining all three approaches during product development, both the customer and the development team gain the opportunity to test their ideas with minimized resource investment. Therefore, the approach involving PoC, prototyping, and MVP practices applied consecutively might be an excellent fit for experimental projects where each stage should be tested and validated.

Let’s now summarize the key differences and similarities between the three approaches discussed in this article. The table below compares PoC, prototyping, and MVP, considering the most important aspects of the three models.

A PoC is typically developed in the following situations:

• Facing uncertainty about feasibility. The solution involves new technologies, complex algorithms, or unique integrations that require verification of their ability to work as intended.
• Planning a high-risk investment. The project has a high potential cost, and stakeholders need assurance that the core concept can be successfully executed.
• Evaluating technical challenges. There are potential issues related to the technical solution’s scalability, performance, compatibility, or security. A PoC allows the development team to address these issues upfront.
• Seeking stakeholder buy-in. A quick demonstration of your idea’s feasibility can help attract stakeholders, investors, or decision-makers and make them support the project.
• Exploring new technologies. When experimenting with new tools, platforms, or frameworks, a PoC helps determine their viability for your project. This aspect is especially relevant to R&D centers. 

A notable proof of concept example is a project in which the Leobit team explored the efficiency of combining .NET MAUI with Blazor for cross-platform development. Our specialists used both frameworks to create a highly efficient codebase for an online media platform and review its performance across different devices. This PoC became the basis for a cross-platform software for searching cinema-related data. Upon successfully validating the technical concept, we proceeded with creating the platform’s wireframes and features that could be tested in practice. 

You need a prototype when you want to explore the user experience, functionality, or visual side of your product idea with minimal resources, time, and investment. These are some specific situations where prototyping would be really beneficial:

• Validating design and user experience (UX). We suggest you try prototyping when you need to test how users will interact with your product or interface. Prototyping allows you to gather feedback on the user journey and the interface’s overall usability before launching full-scale development.
• Testing concepts early. If you’re unsure about how different design elements, such as navigation and layout, will work together, a prototype provides a cost-effective way to test and refine those concepts early in the process.
• Communicating with stakeholders. A prototype helps communicate your vision more clearly to stakeholders, team members, or potential investors. They can test a preview of the product and understand whether the software idea is relevant and worth pursuing.

Leobit had experience of developing a successful prototype of a legal case management platform. We started this phase by creating low-fidelity wireframes, helping our client explore different design concepts. The wireframes helped us visualize the most important user scenarios and outline the app’s crucial functionality. Based on the wireframes, the Leobit team created a more detailed UI/UX layout. 

Upon building a comprehensive and consistent design system, we engaged target users to test the system and validate the outline. After the prototyping phase, our specialists proceeded to the development of a fully functional product that provides various tools aiding prosecutors, defenders, and their clients in managing legal cases. 

We suggest choosing the MVP approach when you’re ready to test your product in the real world. It helps you understand the reception from actual users while minimizing the time and resources required to develop a full-featured solution. This approach is very popular in startup software development. It allows you to understand particular user needs better, helping you identify the most promising directions for the product’s continuous development. 

Here are some specific scenarios where MVP benefits are especially relevant: 

• Testing product-market fit. The primary reason for creating an MVP is to validate whether there is a real demand for your product in the market. For instance, this approach is beneficial when you want to determine if your target audience is willing to pay for or use your app, even if it doesn’t offer complete functionality. An MVP helps you understand the product-market fit by launching with the core features that users need, without committing to the full version.
• Getting early user feedback. Once you’ve developed a basic, functional version of your product, it allows you to collect feedback from actual users. Based on the feedback, you can understand what works well, what features are essential, and what can be improved about your solution. This feedback enables you to adjust the product according to users’ needs before investing further resources.
• Attracting investors.  An MVP is a great way to show investors, potential partners, or stakeholders that your product has traction and that you have a viable, working product. It demonstrates an early version of your solution, which might help you secure the necessary funding to further develop the product.
• Delivering your product to the market as fast as possible. If you need to get your product to market quickly to take advantage of a market opportunity, an MVP is an excellent option. It helps you release a working version out fast and iterate based on real user data.
• Building community engagement. By releasing an MVP, you can begin to build a community of early adopters and brand ambassadors who are invested in the development of your product. Such an approach can set the basis for your forthcoming marketing efforts. 

A solid example of a successful project that began as a minimum viable product is an AI-powered car warranty insurance platform developed by Leobit. While working on this solution, the Leobit team released an early product version with core functionality, such as AI/ML algorithms for risk calculation, a tool for managing insurance claims, and payment system integration. Upon collecting user feedback, which was utterly positive, the client decided to move on with this project. In particular, the Leobit team expanded the app with a scalable website and new features facilitating insurance management. 

To confirm the idea’s feasibility or implement a unique concept in practice, startups may need narrow technical expertise. It may be challenging to find and hire corresponding specialists, especially for short-term projects. That’s why outsourcing PoC, prototype, and MVP development can be an excellent option. 

The key benefits of such an approach are:

• Gaining access to niche expertise without incurring high software development cost
• Eliminating the need to hire an in-house team and supply them with workplace infrastructure
• Hiring a dedicated team that can be easily scaled up or down on demand
• Cooperating with specialists experienced in handling PoC, prototype, and MVP development projects
• Focusing on business tasks while the technical side is covered by the vendor. 

Overall, you gain fresh perspective from specialists possessing experience from multiple PoC, prototype, and MVP app development projects. By leveraging external teams, you can tap into specialized expertise, optimize resource allocation, scale projects more efficiently, and focus more intently on your core business priorities.

Choosing the right approach, such as PoC, prototyping, or MVP, can significantly impact the success of your product development journey. Each method serves a unique purpose, from validating technical feasibility with a PoC to refining user experience through prototyping, and finally, testing market viability with an MVP. By applying these approaches strategically and, when possible, consecutively, businesses can reduce risks, optimize resources, and ensure their ideas are well-aligned with user needs and market demands. 

Whether you’re exploring a concept, fine-tuning functionality, or preparing to launch, Leobit, a company with solid expertise in software development for startups is ready to help you. Over the past 10 years, Leobit has been cooperating with companies ranging from Fortune 500 giants to Silicon Valley startups, resulting in 9 successful exits and 3 growing into unicorns. We know the main startup development challenges and have vast experience in PoCs, prototypes, and minimum viable product development services.

Contact us, and we will be excited to consult you further on the topic!