In 2016 I wrote a blog post titled How much does it really cost to build a tech startup?.
Nearly 3.5 years on it feels like the right time to re-visit this and write about what it costs to develop a tech startup in Australia in 2019.
In that post I provide examples from 2 US sources that gave examples of startup development costs. The good news is that in our experience developing Australian startups, the prices haven't changed drastically over that time.
One example of costs given in that 2016 post was:
"2-sided marketplace with ‘medium’ complexity: $52,600 (web app);"
That's still fairly accurate in October 2019. Without taking too deep a dive I'd say that there has been an increase of about 5 - 10% in that time (inflation over this period was roughly 4% to 6%).
The not so good news for startup founders is that the demand for experienced developers / engineers continues to rise. As with any industry, as demand increases for a particular skill so do salaries.
Currently in Sydney salaries for senior developers for the web development services Launch Lab offer are*:
If we assume the average cost to launch a minimum viable product is $50,000 (this figure leverages off the example of the 2-sided marketplace mentioned above, but you can potentially get started for much less) and you're a non-technical founder in Australia you have the following options to get started:
In summary, if you're a non-technical founder and looking to outsource the development of your startup be prepared to spend between $30,000 - $60,000 on your MVP.
Keep in mind that some agencies will charge less than this and some much more. We recently quoted on the development of a fintech startup where one Sydney web development agency quoted $20,000, Launch Lab quoted $60,000 and another agency quoted $250,000. Be sure to do your home work and ensure the agency (or freelancer) has the right experience and you have enough trust in them.
If you are considering launching your first startup and trying to decide what to do next, you might find these startup lessons for first time founders helpful.
Finally, if you're still reading then be sure to read how long it takes to develop a startup application.
Photo by Melissa Walker Horn on Unsplash
We're an experienced team of startup developers in Australia