Ask IH: What's the cost of running your product?
I was analyzing my costs today, and felt like it could be optimized a bit. Shared my thoughts here (https://hellonext.co/blog/the-cost-of-running-a-bootstrapped-saas-in-2020-my-learnings/) as well.
How are you managing your running costs before you reach breakeven? Any tips you've got?
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We use our own servers. Therefore the costs are very low. For a big service you can count on $100 a month. The small Services share a server.
However, this is naive miscal-culation. Maintenance naturally costs us time. You pay for this time at your cloud service usage. But of course you have this time to bring forward your product.
How did we start?
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Yo, we started small. Very small. Veeeeeery small. We started back then with managed server. 20 Bugs a month 😅 and worked our way up. That's what I'd recommend. Start small. Especially as an Indiehacker.
When you are alone you do not need much to finance your living. You don't need a huge company, no huge server farm, 20 domains, big Webspace or smth else.
Start small and see if your idea works out.
But this advice can also be dangerous. The thing is, starting small does not mean thinking small and some things unfortunately have to start big to work. But for a SaaS you don't need $500 / monthly cloud stuff to get started.
With your $2,378 per year, I'm okay with that.
Btw, you might be interested in this too: https://www.startupcosts.co/ :-)
Yep. I echo that. Running cost for Bullish is $15/mo but could go even lower if I switch from MailerLite to Amazon SES, but that would be a lot more work on my end so my takeaway is to try to be frugal as much as you can but don't compromise in extra work in something that's outside of your core app.
Hey @dehenne,
Thanks for penning this down. I completely agree with you. Small could be dangerous. That’s where the balance of sales, marketing and generating revenue come together.
Startupcosts looks really interesting. Thanks for sharing mate.
So for Bullish, my Stock Market email newsletter, my goal from day one was to be as frugal as possible abusing free tiers from different services and only paying for what's is essential or outside of the free tier.
Bullish runs on Netlify (free tier), MailerLite ($15), Sentry (Free tier), Cronhub.io (Free tier) and a Raspberry Pi at home which is also "free."
Whoa. This is the most optimized setup I have ever seen. Especially the RPi part. Brilliant. :)
Your costs are pretty high imo, I think it's the tech stack you chose. Did you build things yourself or did you contract them out to a design & SW engineering firm?
My costs for Packetriot (https://packetriot.com) are $65/mo and include:
My service currently supports 200 active users a month. Packetriot is an application (HTTP/HTTPS/TCP) tunneling service and operates 24/7 moving bits around constantly. I can easily support 4x more users and traffic at this same cost.
I'm an engineer so I wrote everything on my own. My time is the most expensive part of my business but fortunately I don't have to account ($) for that.
Thanks for sharing and good luck on your path to profitability!
I host my website on Digital Ocean but thanks to referrals I've got a lot of credit so my actual cost is $0. But without credit, it would be $25/mo.
Here’s a cost breakdown for SongRender:
DigitalOcean: ~$110/mo
Papertrail: $7/mo
Postmark: $10/mo (although they have a $75 credit for bootstrapped startups!)
Wow. The stack looks incredibly exiting to me. Especially the render servers. Creating the servers dynamically was your call or is it something that is normal in this industry?
Thank you! It was my call (although after opening support tickets with DigitalOcean, apparently it's a somewhat normal use–case as well), but the stack didn't start like that.
I originally had a $40/mo server that was just acting as a worker, waiting for renders to come in on the queue. It was over–provisioned in a couple ways: one, it was sitting idle most of the time, and two I hadn't tested to see if smaller servers would be sufficient.
Eventually, to save money (with the ancillary effect of less time queuing renders) I switched to dynamically creating the servers in response to user demand. That happened to coincide with a huge spike in traffic, so I ended up spending more money. After that, I experimented rendering on smaller and smaller servers and landed on the $15/mo one.
Cost of running divjoy.com is currently under $50/m. Basically just hosting and Mailchimp.
That’;s really cool. All the best @Gabe
If you don't need all the features from MailChimp you can go to MailerLite which will cost you about $15/mo that's what I did on Bullish
It costs me $1,799.70 / YEAR to run a newsletter and a few databases for readers (Mailchimp, Domain, Hosting, Ghost, and a referral program: Sparkloop )
Nice. Have you considered using any Mailchimp alternative that is open source like https://listmonk.app ? Patch it up with AWS SES and you should have a pretty low cost I believe.
I have not considered low cost alternatives. Mailchimp has so many features that I'm happy and glad to pay them.
Makes sense. 😊
This isn't mine, but I've always found the running costs of the app 'KanbanMail' to be interesting: https://kanbanmail.app/open
Yeah. He has been good at keeping the costs low. I vaguely remember his post where he spoke about using Stripe’s DB for storing user data. Smart.
As a developer, it sounds like my biggest nightmare. I think it's going to cause more trouble than the 5$ dollars per month he saved for spinning up a cheap virtual instance in the cloud and putting a database on it to store the users.
Yep. Any hack that works, is still a hack. Maybe there’s something more to it, but one small change from Stripe’s side, and things could come crashing down.