SaaS Startup Running Costs: $47k Monthly Burn Rate

SaaS Startup Running Costs

Running a SaaS Startup in 2026 requires a high fixed cost base, averaging around $47,158 per month before accounting for revenue-driven variable expenses Payroll is the largest expense, estimated at $33,125 monthly for the initial 40 FTE team Your annual marketing budget starts at $100,000, or about $8,333 per month, to achieve a Customer Acquisition Cost (CAC) of $150 Given the projected EBITDA loss of $332,000 in Year 1, founders must secure at least 12–18 months of cash buffer to reach the break-even point in July 2027 (19 months) The key financial lever is optimizing the Trial-to-Paid Conversion Rate, which starts at 150% and needs to climb quickly to justify the high upfront burn rate

7 Operational Expenses to Run SaaS Startup

#	Operating Expense	Expense Category	Description	Min Monthly Amount	Max Monthly Amount
1	Payroll	Personnel	The 2026 payroll for 40 FTEs totals $33,125 per month, covering key operational roles.	$33,125	$33,125
2	Cloud Hosting	COGS	Hosting fees are a direct cost of goods sold (COGS), starting at 60% of gross revenue in 2026.	$0	$0
3	Customer Acquisition	Marketing	The annual marketing budget is $100,000 in 2026, targeting a Customer Acquisition Cost (CAC) of $150.	$8,333	$8,333
4	Office Costs	Fixed Overhead	Fixed office costs, including $2,500 rent and $300 utilities, total $2,800 monthly.	$2,800	$2,800
5	Transaction Fees	COGS	Payment processing fees are estimated at 25% of revenue in 2026 as volume increases.	$0	$0
6	Legal & Compliance	Fixed Overhead	Maintaining compliance and handling standard legal/accounting needs costs a fixed $1,700 monthly.	$1,700	$1,700
7	Internal Software	Fixed Overhead	Internal software subscriptions for CRM, project management, and collaberation tools add a fixed $800 to overhead.	$800	$800
	Total	All Operating Expenses		$46,758	$46,758

What is the total minimum monthly running budget required for the first year?

The minimum monthly running budget required for the SaaS Startup in its first year is dictated by a baseline operational burn rate of $47,158, which is the figure you need to understand before asking Is The SaaS Startup Currently Achieving Sustainable Profitability?

Burn Rate Components

Wages represent the largest cost at $33,125 monthly.
Baseline marketing budget is fixed at $8,333.
Fixed overhead costs total $5,700 per month.
The sum of these inputs equals the $47,158 required cash burn.

First Year Capital Needs

This calculation assumes zero initial revenue collection.
A 12-month runway demands $565,896 in starting capital.
If onboarding takes 14+ days, churn risk rises defintely.
Your immediate action is securing funding to cover this $47k monthly gap.

Which recurring cost categories will consume the largest share of initial capital?

For your SaaS Startup, the biggest ongoing drains on capital will be personnel costs and the hosting environment; payroll accounts for 70% of your baseline fixed costs, while cloud infrastructure will eat up about 60% of your revenue. If you're mapping out the initial spend, check out the breakdown in How Much Does It Cost To Open And Launch Your SaaS Startup?

Payroll Dominates Fixed Spend

Salaries are the single largest fixed overhead component.
Expect payroll to consume 70% of your baseline fixed costs.
Hiring too fast before achieving solid MRR risks immediate cash burn.
This figure covers core engineering, product, and initial sales hires.

Cloud Costs Scale With Sales

Infrastructure costs scale directly with customer usage.
This hosting commitment is estimated at 60% of total revenue.
Keep a close eye on data storage and compute usage, defintely.
Controlling this variable cost is essential for improving gross margin.

How many months of cash buffer are needed to reach the projected break-even point?

You need to secure enough runway to cover operations for the 19 months required to reach projected break-even in July 2027, which means having $452,000 minimum cash on hand at that time; securing this runway is critical, so Have You Considered The Best Strategies To Launch Your SaaS Startup Successfully? for planning purposes, defintely.

Runway to Profitability

Projected break-even month is July 2027.
This requires 19 months of operational runway planning.
Buffer must cover cumulative losses until month 19.
If customer acquisition cost (CAC) rises, this timeline extends past 19 months.

Minimum Cash Requirement

The minimum required cash balance at BE is $452,000.
This sets the floor for your total capital raise needs.
If your average monthly burn rate is $23,789, $452k covers exactly 19 months.
You must raise capital to cover this $452k plus a 3-month safety cushion.

What specific cost levers can be pulled if customer acquisition targets are missed?

If customer acquisition targets for the SaaS Startup are missed, immediate cost control must center on the $100,000 annual marketing spend and pausing non-critical hiring, like the planned 0.5 FTE Admin Assistant. This defensive posture preserves runway while you recalibrate go-to-market efforts; Have You Considered The Best Strategies To Launch Your SaaS Startup Successfully?

Marketing Spend Reduction

Cut the $100,000 annual marketing spend immediately if CAC targets fail.
Stop spending on channels showing poor return on investment (ROI).
Focus remaining dollars on high-intent, low-cost acquisition paths.
Reallocate funds toward customer success to boost retention rates.

Personnel Cost Deferral

Delay hiring any non-essential full-time equivalent (FTE) staff.
Specifically postpone the 0.5 FTE Admin Assistant role indefinitely.
This preserves cash flow until revenue stabilizes or improves.
Review all planned hires against immediate revenue impact.

Key Takeaways

The baseline operational cost for running a new SaaS startup in 2026 averages a significant $47,158 per month before revenue-driven variable expenses are factored in.
Payroll is the largest expense driver, consuming $33,125 monthly to support the initial team of 40 full-time equivalents (FTEs).
Founders must secure at least a 12–18 month cash buffer to sustain operations until the projected break-even point in July 2027 (19 months).
The initial marketing strategy targets a Customer Acquisition Cost (CAC) of $150, supported by a baseline annual budget of $100,000.

Running Cost 1 : Payroll & Salaries

Payroll Baseline

Your 2026 personnel budget requires $33,125 monthly to cover 40 full-time equivalents (FTEs), including leadership, development, sales, and support staff. This figure sets your baseline operational expense before variable hiring needs. That's the number you need to fund first.

Staffing Basis

This $33,125 monthly payroll estimate covers 40 roles, which includes partial staff allocations across the organization. Inputs combine the CEO, Lead Developer, Marketing, Sales, Support, and Admin functions necessary for scaling the SaaS platform. You defintely need to map these roles to specific salary bands now.

Roles: CEO, Lead Dev, Sales, Support.
Total Headcount: 40 FTEs (blended).
Yearly Cost: $397,500 total payroll.

Salary Control

Managing this large fixed cost means controlling hiring pace and role definition closely. Avoid hiring for roles that aren't immediately revenue-generating or critical path until MRR stabilizes. Early stage, focus on high-leverage generalists over specialized hires.

Prioritize Sales and Dev hiring first.
Stagger hiring beyond the initial 40 roles.
Use contractors for non-core tasks initially.

Budget Reality

Personnel is your largest fixed drain; if you hit $33,125 in month one, operational runway shortens significantly. Ensure your initial funding covers at least 12 months of this burn rate plus overhead before launching paid acquisition.

Running Cost 2 : Cloud Infrastructure

Hosting Cost Hit

Hosting fees are a massive initial drag, starting as 60% of gross revenue in 2026. This means your Cost of Goods Sold (COGS, direct costs tied to service delivery) is extremely high initially. Expect this percentage to fall to 40% by 2030 as infrastructure use becomes more efficient at scale.

Modeling Hosting as COGS

Hosting is a direct COGS, covering server time and data processing for your platform. You must model this as a percentage of revenue, not a fixed dollar amount, because it scales directly with every customer you onboard. To estimate the 60% figure, you need quotes based on anticipated per-user compute load for 2026.

Input: Projected user count.
Input: Estimated data storage needs.
Input: Per-unit compute cost.

Cutting Initial Hosting Fees

Reducing that initial 60% COGS requires aggressive architectural planning right now. Avoid over-provisioning capacity for anticipated growth; stick to just-in-time resource allocation. If onboarding takes too long, churn risk rises, but rapid provisioning without optimization burns cash fast.

Audit resource utilization weekly.
Use smaller, cheaper instances first.
Shift analytics processing off-peak.

Margin Pressure Check

A 60% hosting cost leaves you with only a 40% gross margin, which is very tight for a SaaS startup. This thin margin must absorb the $800 in operational software plus the 25% transaction fees before you even touch the $33,125 payroll. You defintely need high initial ARPU to survive this phase.

Running Cost 3 : Customer Acquisition

Acquisition Target

Your 2026 marketing plan dedicates $100,000 to acquire new users, aiming for a $150 Customer Acquisition Cost (CAC). This budget should generate about 667 trial sign-ups for the year, which is the immediate goal of this spending.

Budget Breakdown

This $100,000 marketing spend is set for 2026 to fuel initial trial growth for the platform. The target CAC of $150 means you must spend $150 for every user who starts a trial. Here’s the quick math: $100,000 divided by $150 yields roughly 667 new trials annually. That’s your volume target.

Annual Spend: $100,000
Target CAC: $150
Expected Trials: 667

Managing CAC

To make this budget stretch further, focus intensely on trial-to-paid conversion, not just sign-ups. If you convert even 10% more trials, you effectively lower your blended CAC. Avoid spending heavily on channels that don't deliver qualified leads ready to buy the subscription; defintely track trial quality.

Optimize trial onboarding flow.
Track paid conversion rates closely.
Test small ad spends first.

The Real Risk

If onboarding takes longer than expected, or if the initial product experience is weak, that $150 CAC will quickly become worthless. Churn risk rises fast if trials don't see immediate value within the first week of use.

Running Cost 4 : Office Rent & Utilities

Fixed Space Cost

Your initial physical overhead for the office space is set at $2,800 per month. This covers the rent and necessary utilities for the small footprint you start with. This is a critical fixed cost that must be covered regardless of subscription sales volume.

Calculating Space Overhead

Estimate this fixed overhead by summing the base lease payment and estimated monthly utility consumption. For Momentum OS, this means taking the $2,500 rent quote and adding the $300 utilities estimate. This total of $2,800 is locked in monthly until you scale past this initial physical setup.

Rent input: $2,500
Utilities input: $300
Total fixed cost: $2,800

Managing Office Spend

For a SaaS startup, physical space is often the most flexible fixed cost you control early on. Avoid signing long-term leases based on aggressive hiring projections. Keep this cost low until MRR growth justifies expansion. Many software teams can operate defintely well with minimal or shared space initially.

Delay signing leases past 12 months.
Use co-working spaces initially.
Factor in scalability risk.

Fixed Cost Impact

At $2,800 monthly, office costs are small compared to the $33,125 payroll burden projected for 2026. However, this $2,800 must be covered before any revenue hits the bank. If you delay hiring, this fixed cost becomes a larger percentage of your remaining operational burn rate.

Running Cost 5 : Transaction Fees

Fee Projections

Payment processing hits hard early on for this subscription business. Expect transaction fees to consume 25% of revenue in 2026. This cost scales down to 20% by 2030 as your cumulative payment volume improves your negotiated rates.

Fee Basis

This cost covers fees charged by banks and payment gateways to process customer subscriptions for Momentum OS. You calculate this by taking total recognized revenue and multiplying it by the effective rate. For 2026, the key input is the 25% rate applied against your projected MRR.

Total Monthly Recurring Revenue (MRR)
Effective processing rate (25% in 2026)
Setup fees collected (if applicable)

Managing Costs

You can defintely lower this percentage by shifting customers away from monthly card payments. Annual upfront payments often qualify for lower per-transaction fees. Also, push customers toward ACH transfers if your platform supports it, as those rates are usually lower than standard card interchange fees.

Incentivize annual prepayments now.
Negotiate rates based on volume tiers.
Favor ACH payments over credit cards.

Volume Leverage

The expected drop from 25% to 20% relies entirely on scaling volume fast enough to unlock better tier pricing from your processor. If growth stalls, you remain stuck paying the higher 25% rate indefinitely, severely impacting gross margin projections.

Running Cost 6 : Legal & Compliance

Fixed Compliance Cost

Your fixed overhead for legal, accounting, and basic cybersecurity protection is exactly $1,700 every month. This cost is non-negotiable for maintaining compliance as Momentum OS scales its US operations. You need to budget for this before you see your first dollar of revenue.

Cost Breakdown

This $1,700 is essential fixed overhead, separate from variable costs like hosting. The breakdown includes $1,000 for standard legal counsel and accounting needs, plus $700 dedicated to cybersecurity maintenance. If your initial setup requires specialized compliance advice, this monthly estimate will defintely rise.

Legal/Accounting: $1,000 fixed monthly.
Cybersecurity: $700 fixed monthly.
Total fixed compliance cost: $1,700.

Cost Management

Don't overpay for generalist legal advice early on. Bundle your initial incorporation, IP filing, and standard contract reviews into one fixed-fee package with a specialist firm. You can save money by delaying non-essential compliance audits until you hit $1 million in Annual Recurring Revenue (ARR).

Bundle initial legal scoping.
Negotiate fixed monthly retainer caps.
Defer non-essential compliance until scale.

Cyber Risk Visibility

That $700 cybersecurity spend isn't just insurance; it's foundational for a SaaS platform handling client data. Underinvesting here exposes you to breach costs far exceeding this monthly fee, especially given your target market of SMBs who expect high security standards.

Running Cost 7 : Operational Software

Fixed Software Overhead

Operational software subscriptions for CRM, project management, and collaboration tools create a fixed $800 monthly overhead for this SaaS startup. This cost is non-negotiable for internal function, regardless of initial revenue volume.

Cost Inputs

This $800 covers licenses for the required internal stack: CRM, project management, and team chat software. It’s a fixed commitment layered on top of $2,800 monthly rent. You need quotes for seat counts to verify this baseline expense before launch.

Covers essential internal tools.
Fixed monthly commitment.
Budgeted before revenue starts.

Managing Subscriptions

Negotiate annual contracts to capture savings, often 15% or more off the monthly rate. A key risk is seat creep; defintely audit user access quarterly. If you need 20 seats now, don't budget for 50 until hiring demands it.

Seek yearly prepayment discounts.
Audit licenses every 90 days.
Avoid premium features initially.

Runway Impact

Because this is fixed, the $800 sets a hard floor on your operating burn rate before payroll even starts. It must be covered by initial capital, as it won't scale down if initial sales are slow.