How much running a SaaS can cost you in 2024?
Avi Mahajan
Partner - Consult @ AIT Global Inc. | We build great teams that build great products!
Developing a SaaS product is one thing, but maintaining it by covering server and developer costs is another. Let's take a closer look at the costs involved using the example of a tool that validates email addresses by performing multiple checks, including MX, DKIM, DMARC, SPF, and domain authenticity against 150,000+ spam domains.
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Here’s a breakdown of the server costs:
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????????????: Used to monitor service metrics. If on the free plan, which meets the needs.
??????????????: Used for Kafka, managing email processing queues with minimal configuration. This will cost about $20 monthly, but can exceed $50 as queue sizes grow.
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In total, server costs amount to approximately $520-$550 per month. Most SaaS MVPs range from $300-$550 per month depending on features and services used.
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Hiring a developer involves:
?????????????? ????????????: Let's assume $5000 per month for a developer working Monday to Friday. Tasks include deployments, CI/CD pipeline setup, bug fixes, and feature development.
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This is my understanding of the current market and average associated costs:
Assembling an In-House Team (USA / On-site)
Offshore Contractor Pricing Estimates
Conclusion
For more complex SaaS products, costs will vary depending on the complexity and the number of developers needed.
In the above example - Running a validator tool costs around $520-$550 monthly for servers and $5000 monthly for developer costs. While these figures can vary based on the specifics of each SaaS project, they provide a rough estimate of what to expect.
In the current market landscape, the choice between forming an in-house team in the USA and opting for offshore contractors hinges on budget, timeline, and project requirements.
In-House Team (USA / On-site): The investment for an in-house team is substantial, with costs surpassing $450,000 over a six-month period. This option ensures direct oversight and collaboration but comes at a premium.
Offshore Contractors: Conversely, offshore solutions offer a more cost-effective approach, starting at $50,000 with a quicker development timeline of 60-90 days. This path may be ideal for projects with tighter budgets and more flexible management needs.
Ultimately, the decision should align with your strategic goals, weighing the benefits of direct engagement against the advantages of cost savings and expedited delivery.
If you have questions or need help understanding costs for your SaaS, feel free to reach out. I’m here to help
Understanding the ongoing costs of running a SaaS product is crucial for its sustainability. Your insights into the monthly expenses provide valuable perspective for startup founders and entrepreneurs. Thank you for shedding light on this important aspect, Avi Mahajan!
Customer Support Executive at ShriCloud
8 个月Launching a SaaS product is indeed exhilarating, and your insights into the ongoing costs are invaluable for entrepreneurs and startup founders. Understanding these costs is vital for long-term success. Your expertise is truly beneficial for those considering their own SaaS venture. Great work, Avi Mahajan!
B2B SaaS Companies: Drive sustainable growth through personal branding for Founders and Leaders
9 个月Understanding these cost dynamics can guide startups in making informed decisions about resource allocation and development strategies. It highlights the importance of balancing quality and affordability when scaling SaaS solutions. Great insights, Avi Mahajan
Marketing and Branding ∞ Technology ∞ Creativity
9 个月Understanding the long-term costs of running a SaaS product is vital for sustainable growth. Your insights shed light on the monthly expenses and offer valuable tips for effective cost management. This breakdown will undoubtedly benefit startup founders and entrepreneurs in planning and sustaining their ventures.