You have a SaaS idea. You're ready to start. But how much money do you actually need?

After working with 50+ SaaS founders over the past decade, I can tell you: most founders dramatically underestimate total startup costs.

They budget $30K for development, then run out of money before launch because they forgot about hosting, legal, marketing, tools, and a dozen other expenses.

Or they raise $200K, burn it all in 6 months on over-hiring and fancy tools, and have nothing to show for it.

This guide breaks down exactly what it costs to start a SaaS company in 2025, based on real data from founders I've worked with. You'll see complete first-year budgets at three funding levels, what to prioritize, and how to avoid the expensive mistakes I see every week.

Quick Answer: Cost to Start a SaaS Company in 2025

Here's what you'll actually spend to launch and run a SaaS company for 12 months:

By Funding Level:

Bootstrapped (savings): $35,000-$65,000 first year
Funded (seed/pre-seed): $100,000-$200,000 first year
Well-funded (Series A): $250,000-$500,000+ first year

By Phase:

Pre-launch (MVP): $20,000-$60,000 (development, design, legal setup)
Launch (months 1-3): $15,000-$40,000 (marketing, tools, first hires)
Growth (months 4-12): $30,000-$120,000+ (ongoing dev, marketing, team)

Real-world average from founders I've worked with: $88,000 first year for bootstrapped startups, $135,000 for funded startups.

The expensive mistake: Founders spend 80% on development, 20% on everything else. Should be 30-40% development, 30-40% marketing, 20-30% operations.

For detailed MVP development costs specifically, see: MVP Developer Cost: Complete 2025 Pricing Guide

Complete First-Year Budget: Bootstrapped ($35,000-$65,000)

This is for solo founders or small teams using savings, no external funding.

Pre-Launch (Months 1-3): $22,000-$32,000

Development & Design:

MVP development: $15,000-$22,000 (simple to medium complexity)
UI/UX design: $2,000-$4,000 (freelance designer, 5-10 key screens)
Bug fixes post-launch: $2,000-$3,000

Business Setup:

Legal (LLC/incorporation): $500-$1,500
Terms of service + privacy policy: $500-$1,000
Accounting software setup: $200-$400

Domain & Infrastructure:

Domain registration: $20-$50
Initial hosting setup: $100-$300

Total Pre-Launch: $20,200-$32,250

Launch Phase (Months 4-6): $7,500-$15,000

Hosting & Services (3 months):

Hosting (Vercel, Railway): $50-$150/month = $150-$450
Database (Supabase, Planetscale): $0-$50/month = $0-$150
Email service (SendGrid, Postmark): $15-$30/month = $45-$90
Auth service (Clerk, Auth0): $0-$25/month = $0-$75
Monitoring (Sentry, LogRocket): $25-$50/month = $75-$150
Payment processing (Stripe fees): ~2.9% of revenue (variable)

Total services: $270-$915/quarter

Marketing:

Landing page optimization: $500-$1,000 (copywriter or DIY)
Initial content (3-5 blog posts): $1,500-$3,000 (if outsourced, or your time if DIY)
Google/Facebook ads testing: $1,000-$2,000 (small test budgets)
Email marketing tool (ConvertKit, Mailchimp): $30-$60/month = $90-$180

Tools:

Project management (Linear, Notion): $0-$20/month = $0-$60
Customer support (Intercom starter, Plain): $0-$50/month = $0-$150
Analytics (Google Analytics): Free
Design tools (Figma, Canva): $15-$30/month = $45-$90

Ongoing Development:

Feature additions + bug fixes: $2,000-$4,000 (retainer or hourly)

Total Launch Phase: $6,405-$11,445 (3 months)

Growth Phase (Months 7-12): $9,000-$22,000

Hosting & Services (6 months):

Same as above but scaled up: $800-$2,400 (as usage grows)

Marketing:

Content creation (blog, guides): $3,000-$6,000
Paid ads: $2,000-$5,000
SEO tools (Ahrefs, Semrush): $0-$600 (6 months)

Ongoing Development:

Feature development: $6,000-$12,000 (6 months retainer)
Infrastructure improvements: $1,000-$3,000

Tools & Operations:

Increased tool costs as team grows: $300-$900 (6 months)

Contingency:

Emergency bug fixes, unexpected costs: $1,000-$2,000

Total Growth Phase: $13,100-$32,900 (6 months)

TOTAL BOOTSTRAPPED FIRST YEAR: $39,705-$76,595

Average: ~$58,000

Reality check: Most bootstrapped founders spend $40K-$65K to get to first revenue, then reinvest earnings into growth.

Complete First-Year Budget: Funded ($100,000-$200,000)

This is for founders who've raised pre-seed or seed funding ($150K-$500K).

Pre-Launch (Months 1-4): $45,000-$75,000

Development & Design:

MVP development: $28,000-$45,000 (medium to complex MVP)
Professional UI/UX: $8,000-$15,000 (full brand + design system)
QA testing: $3,000-$5,000
Bug fixes post-launch: $4,000-$8,000

Business Setup:

Legal (incorporation, contracts, etc.): $2,000-$5,000
IP/trademark: $1,000-$2,500
Accounting/bookkeeping: $500-$1,500

Infrastructure:

Domain + initial setup: $200-$500

Total Pre-Launch: $46,700-$82,500

Launch Phase (Months 5-7): $28,000-$50,000

Hosting & Services (3 months, scaled up):

Hosting: $150-$400/month = $450-$1,200
Database: $50-$200/month = $150-$600
Email + auth + monitoring: $100-$250/month = $300-$750
Payment processing: Variable (2.9% of revenue)

Total services: $900-$2,550/quarter

Marketing:

Landing page + funnel optimization: $3,000-$6,000
Content creation (10-15 posts): $5,000-$10,000
Paid ads: $5,000-$10,000
Email marketing: $50-$150/month = $150-$450

Tools:

Project management: $20-$50/month = $60-$150
Customer support: $100-$300/month = $300-$900
Analytics (Mixpanel, Amplitude): $0-$100/month = $0-$300
CRM (HubSpot, Pipedrive): $50-$150/month = $150-$450

Team:

Part-time marketer or contractor: $3,000-$6,000/month = $9,000-$18,000
Ongoing development: $6,000-$10,000/month = $18,000-$30,000

Total Launch Phase: $41,560-$69,300 (3 months)

Growth Phase (Months 8-12): $40,000-$80,000

Hosting & Services (5 months, scaled up more):

All services combined: $2,000-$5,000 (as you grow)

Marketing:

Content + SEO: $8,000-$15,000
Paid acquisition: $10,000-$20,000
Marketing tools: $500-$1,500

Team:

First full-time hire (developer or marketer): $25,000-$40,000 (5 months salary)
Ongoing contractors: $5,000-$10,000

Ongoing Development:

Feature development: $10,000-$20,000

Total Growth Phase: $60,500-$111,500 (5 months)

TOTAL FUNDED FIRST YEAR: $148,760-$263,300

Average: ~$185,000

Reality check: Funded founders should expect to spend $150K-$200K to reach $10K-$20K MRR in year one.

Complete First-Year Budget: Well-Funded ($250,000-$500,000+)

This is for founders with significant seed or Series A funding ($1M+).

Pre-Launch (Months 1-4): $75,000-$120,000

Development & Design:

MVP development: $50,000-$75,000 (complex, enterprise-ready)
Professional design: $15,000-$25,000 (full brand, design system, animations)
QA + testing: $8,000-$12,000
Bug fixes: $6,000-$10,000

Business Setup:

Legal (comprehensive): $5,000-$10,000
IP/trademark/patents: $3,000-$8,000
Accounting/CFO services: $2,000-$5,000

Total Pre-Launch: $89,000-$145,000

Launch Phase (Months 5-8): $80,000-$150,000

Hosting & Services (4 months, enterprise-grade):

Infrastructure: $500-$1,500/month = $2,000-$6,000
Tools/services combined: $400-$800/month = $1,600-$3,200

Marketing:

Launch campaign: $15,000-$30,000
Content creation: $10,000-$20,000
Paid acquisition: $20,000-$40,000
PR/press outreach: $5,000-$15,000

Team:

2-3 full-time employees: $60,000-$100,000 (4 months combined)

Ongoing Development:

Active feature development: $20,000-$40,000

Total Launch Phase: $133,600-$254,200 (4 months)

Growth Phase (Months 9-12): $100,000-$200,000

Hosting & Services:

Infrastructure at scale: $4,000-$10,000 (4 months)

Marketing:

Aggressive paid acquisition: $30,000-$60,000
Content + SEO: $15,000-$30,000
Events/conferences: $5,000-$15,000

Team:

Growing to 5-7 employees: $80,000-$150,000 (4 months combined salaries)

Ongoing Development:

Feature development + scaling: $25,000-$50,000

Total Growth Phase: $159,000-$315,000 (4 months)

TOTAL WELL-FUNDED FIRST YEAR: $381,600-$714,200

Average: ~$500,000

Reality check: Well-funded startups should target $50K-$100K MRR by end of year one to justify this spend.

What to Spend Money On FIRST (Priority Allocation)

Most founders ask: "Where should I spend my limited budget?"

Here's the priority order based on what actually moves the needle:

Phase 1: Get to MVP (Months 1-3)

Priority Allocation:

Development (70%): MVP that solves core problem
Design (15%): Clean, professional UI (not award-winning)
Legal (10%): Basic incorporation, contracts
Infrastructure (5%): Domain, hosting, basic tools

Budget: $18,000-$50,000 depending on funding level

Goal: Launch something real customers can use in 6-12 weeks.

Phase 2: Get to First 10 Customers (Months 4-6)

Priority Allocation:

Marketing (40%): Landing page, content, ads testing
Development (30%): Bug fixes, critical feature additions
Sales/outreach (20%): Your time doing customer development
Tools (10%): Essential services only

Budget: $6,000-$40,000

Goal: 10 paying customers (even if discounted or beta pricing). Validate product-market fit signals.

Phase 3: Get to $10K MRR (Months 7-12)

Priority Allocation:

Marketing (40-50%): Double down on what's working
Development (30%): Features that paying customers request
Team (10-15%): First hire (developer or marketer)
Tools/ops (5-10%): Scale infrastructure as needed

Budget: $15,000-$150,000

Goal: $10K MRR = $120K ARR. You've validated a real business.

Monthly Burn Rate: What's Normal?

Burn rate = How much cash you spend per month.

Bootstrapped Burn Rates

Months 1-3 (pre-launch): $6,000-$10,000/month

Mostly development costs
Minimal recurring costs

Months 4-6 (post-launch): $3,000-$6,000/month

Development slows down
Marketing increases
Starting to get revenue

Months 7-12 (growth): $2,000-$5,000/month net burn

Revenue growing
Reinvesting profits

Goal: Reach profitability (revenue > costs) by month 8-12.

Funded Burn Rates

Months 1-4 (pre-launch): $12,000-$20,000/month

Faster development (senior developers)
Professional design
Initial team hires

Months 5-8 (launch): $15,000-$30,000/month

Marketing spend increases
Team grows to 2-3 people
Tools and services scale up

Months 9-12 (growth): $20,000-$50,000/month

Aggressive customer acquisition
Team of 5-7 people
Infrastructure scales

Goal: Reach $10K-$20K MRR by month 12. Burn rate justified by growth.

Well-Funded Burn Rates

Months 1-4: $20,000-$35,000/month Months 5-8: $30,000-$60,000/month Months 9-12: $40,000-$80,000/month

Goal: Hit $50K-$100K MRR by month 12 to justify continued funding.

The Biggest Mistakes Founders Make with Budget

Mistake #1: Spending 80% on Development

What founders do:

MVP: $40,000
Marketing: $5,000
Everything else: $5,000

What happens: They build a beautiful product no one knows about. Can't afford marketing. No customers.

What you should do:

MVP: $25,000 (60%)
Marketing: $10,000 (24%)
Everything else: $7,000 (16%)

Build a good-enough MVP fast, spend real money on customer acquisition.

Mistake #2: Hiring Too Early

What founders do: Raise $200K, immediately hire 3 full-time employees. Burn $30K/month. Run out of money in 6 months with no revenue.

What you should do: Stay lean until $10K MRR. Use contractors and part-time help. First full-time hire at $5-10K MRR, second at $15-20K MRR.

Mistake #3: Buying Every Tool on Day 1

What founders do:

Notion: $10/month
HubSpot: $800/month
Intercom: $200/month
Salesforce: $300/month
Slack: $8/user/month
Figma: $15/month
10 other tools: $500/month

Total: $1,833/month = $22,000/year on tools before first customer.

What you should do: Start with free tiers. Upgrade only when you hit limits. Essential tools only: email (free), analytics (free), hosting ($50), payment processing (variable).

Total: $50-$150/month year one.

Mistake #4: Building for Scale on Day 1

What founders do: Spend $60K on enterprise-grade infrastructure, load balancers, auto-scaling, CI/CD pipelines... for 0 users.

What you should do: Start with simple hosting (Vercel, Railway). Costs $50-$200/month and handles 10,000+ users easily. Upgrade infrastructure when you have real scale problems (1,000+ active users).

Mistake #5: Not Budgeting for Marketing

What founders do: "We'll do organic marketing" (translation: we'll post on Twitter and hope for the best).

What happens: 6 months after launch, still 0 customers. Beautiful product, no distribution.

What you should do: Budget $500-$2,000/month minimum for marketing from day one. Even bootstrapped founders need paid acquisition testing, content creation, or ads.

For complete SaaS development cost breakdown, see: How Much Does It Cost to Build a SaaS in 2025?