Startup: Launch Budget

This article was written by our expert who is surveying the industry and constantly updating the business plan for a startup.

Who wrote this content?

The Dojo Business Team

A team of financial experts, consultants, and writers

We're a team of finance experts, consultants, market analysts, and specialized writers dedicated to helping new entrepreneurs launch their businesses. We help you avoid costly mistakes by providing detailed business plans, accurate market studies, and reliable financial forecasts to maximize your chances of success from day one—especially in the startup market.

What one-time costs do I need before launch (registration, licenses, permits)?

Set aside a clear pre-launch budget for company formation and mandatory approvals for a startup.

Plan for registration fees, sector licenses, foreign ownership approvals (if relevant), and initial legal/accounting support; include hidden items like translations, stamp duties, and bank setup. In many markets, this sums to $2,500–$30,000+, with regulated or foreign-majority structures at the higher end.

If you are incorporating where foreign business licenses or sector approvals apply, expand the range materially and add extra weeks for processing. Include a 10–20% buffer to absorb unpredictable administrative changes.

You’ll find jurisdiction-specific checklists and fee models in our startup business plan.

Add these costs to your total capital target before you raise or wire funds.

What is my projected monthly burn in the first year (rent, payroll, utilities)?

Build a line-by-line monthly burn for your startup covering payroll, facilities, software, marketing, and admin.

Most early-stage teams land between $30,000 and $80,000 per month depending on headcount and growth goals; “gross burn” is total spend and “net burn” subtracts revenue. Use the baseline table below and tailor each cell to your market and hiring plan.

How much should I allocate to product development or manufacturing before revenue?

Budget product development for your startup up front, not after launch.

Moderately complex products typically require $30,000–$100,000+ to cover design, prototypes, certifications, and initial tooling; physical products may need an extra $10,000–$100,000+ for molds and a pilot batch. The table below helps you scope the right order of magnitude by product type.

How much working capital covers the first six months without income?

Hold enough cash to operate your startup for at least six months with zero revenue.

Multiply your realistic monthly burn by six, then add a 10–20% buffer; this cushions delays in sales cycles and hiring. Use the scenarios below to size your reserve precisely.

What budget do I need for software, hosting, and security?

Fund core technology for your startup with both upfront and recurring lines.

Expect $50,000–$150,000 for initial hardware/software/security in tech-heavy models, plus $500–$5,000/month for cloud and tools; ring-fence 10–15% of IT spend for security/maintenance. Break it down as follows and tailor by architecture and data sensitivity.

How much should I reserve for launch marketing and customer acquisition?

Set a dedicated, time-boxed launch budget for your startup’s first customers.

Allocate 12–20% of projected revenue or a fixed $15,000–$100,000 for initial campaigns; B2B SaaS often commits 20–40% of early capital to pipeline generation. Use the channel table below to choose a balanced mix and cap CAC early.

You’ll find detailed market insights in our startup business plan, updated every quarter.

What contingency percentage should I add for unexpected costs?

Add a contingency buffer across your startup budget to prevent cash shocks.

Use 10–20% of total spend, leaning closer to 20% for hardware, compliance-heavy, or foreign-owned structures; 10–12% can suffice for straightforward software launches. Apply the percentage after you total all one-time and monthly items.

Keep the buffer in a separate account and release it only with a documented overrun reason and approval. Recompute the buffer after major scope changes or vendor shifts.

This is one of the strategies explained in our startup business plan.

Protecting runway beats scrambling for bridge cash later.

Which professional service fees should I factor in (legal, accounting, consulting)?

Budget specialist support for your startup from day one.

Expect $10,000–$50,000 for initial legal, accounting, and advisory setup, plus annual compliance in the low thousands depending on jurisdiction and complexity. Include scope for shareholder agreements, IP assignments, employment contracts, and tax registrations.

For foreign-majority entities, expect higher structuring costs and more filings; align early with counsel on cap table, option pool, and data-processing addenda. Pre-negotiate fixed-fee packages to avoid hourly surprises.

We cover this exact topic in the startup business plan.

Pick advisors who understand startups, not just general SMEs.

What equipment or physical assets should I buy upfront, and what can I lease?

• Buy laptops and core development machines if you need custom specs or high security controls; total $2,000–$3,500 per engineer including accessories.
• Lease servers, specialized lab gear, or vehicles to preserve cash and upgrade flexibly; compare 24–36 month terms with fair-market-value buyouts.
• Subscribe to printers, networking, and POS hardware where replacement cycles are short and uptime SLAs matter.
• Refurbished options can cut device capex by 20–40% with minimal performance tradeoffs; ensure warranty and data-wipe standards.
• Standardize SKUs to simplify support, spares, and imaging; bulk purchasing reduces per-unit cost and setup time.

How much funding is required to hire and onboard the first team members?

Plan hiring cash needs for your startup beyond salaries alone.

For 4–6 initial hires, budget $100,000–$200,000 for Year 1 including salaries, benefits, recruiting fees (or tooling), equipment, and onboarding time; preload 1–2 months of payroll before product-market fit. Stagger hires against milestones to keep burn aligned with validated learning.

Add a 10–15% benefits and taxes uplift to base salaries; include signing bonuses only where time-to-hire is critical. Track time-to-productivity so you know whether onboarding is working.

This is one of the many elements we break down in the startup business plan.

Hire just-in-time, not just-in-case.

What are the estimated insurance costs (liability and employee policies)?

• General liability: $400–$2,000/year for small teams; higher with premises and events.
• Professional liability (E&O): $800–$5,000/year depending on contract sizes and data exposure.
• Cyber liability: $1,200–$7,000/year; underwriters will expect MFA, backups, and logging.
• D&O (for funded startups): $2,000–$10,000+/year based on round size and board composition.
• Workers’ comp / employee health: highly jurisdictional; model 2–12% of payroll plus local health premiums.

How much should I set aside as a contingency fund?

Ring-fence a contingency for your startup equal to at least one-tenth of total spend.

Use 10–20% depending on complexity, supply chain risk, and regulatory exposure; track draws with variance reports so patterns surface early. Refill the fund after material scope changes or new vendors.

Keep it liquid and separate from operating cash to avoid accidental spend. Pair this policy with monthly reforecasting to spot slippage.

It’s a key part of what we outline in the startup business plan.

Small buffers prevent large delays.

What is the minimum capital needed to reach break-even under conservative assumptions?

Add up all startup costs for 12–18 months under cautious revenue assumptions.

Combine one-time setup, six to twelve months of burn, product build, early marketing, and contingency; then check that your cash covers this sum plus a small working capital cushion. Use the reference model below to compute your minimum target.

What exact budget should I plan for technology security and maintenance?

Dedicate part of your startup’s tech budget to security and upkeep.

Allocate 10–15% of total IT to patching, endpoint protection, backups, and audits; schedule quarterly reviews to align with customer security questionnaires. Add breach response playbooks and log retention so you pass enterprise diligence.

Encrypt at rest and in transit, enforce MFA, and use least-privilege IAM as default. Document controls to shorten sales cycles with security-sensitive customers.

Get expert guidance and actionable steps inside our startup business plan.

Security spend protects revenue, not just data.

How should I structure my initial marketing split across channels?

Use a simple, test-heavy split for your startup’s first quarter of acquisition.

Start 40% paid (fast signal), 30% content/SEO (compounding), 20% outbound/partners (targeted), 10% PR/events (credibility); rebalance weekly based on CAC and conversion. Cap CAC at ≤ 1/3 of LTV until retention is proven.

Implement cohort tracking on day one and hold a weekly growth review with clear kill/scale rules. Keep creative and landing pages on a two-week refresh cadence.

This is one of the strategies explained in our startup business plan.

Velocity beats perfection in early growth.

How do I track and update this launch budget once the startup is live?

Operate your startup budget with a monthly rolling forecast.

Every month, compare actuals to budget by line, investigate variances ≥10%, and reforecast the next six months; this keeps your runway real. Freeze hiring until CAC-to-LTV and retention hit minimum thresholds.

Build a simple dashboard for cash, burn, CAC, payback, and MRR; insist on weekly data hygiene. Share a one-page update with stakeholders highlighting burn, runway, and key risks.

We cover this exact operating rhythm in the startup business plan.

Discipline extends runway without slowing learning.

Conclusion

This article is for informational purposes only and should not be considered financial advice. Readers are encouraged to consult with a qualified professional before making any investment decisions. We accept no liability for any actions taken based on the information provided.

Sources

1. Themis Partner — Company Formation Costs
2. Cadcrowd — New Product Development Costs
3. Stripe — Cost to Start a Business
4. Stripe — Burn Rate Guide
5. InnovateThrive — Startup Financials
6. BusinessPlan-Templates — IT Infrastructure Budgeting
7. Xander Marketing — 2025 SaaS Marketing Budget
8. Stripe — Startup Budgeting Guide
9. BBCIncorp — Startup Cost Benchmarks
10. Stripe (Thailand) — Startup Costs 101