In light of the recent 'Ask HN' on churn rate: what's your burn rate: how much money do you need every month to stay afloat? Which techniques do you use to reduce your burn rate?
[Edited to add the burnrate reduction topic]
Ask HN: What's your burn rate? What do you do to reduce it?
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Re: Ask HN: What's your burn rate? What do you do to reduce it?
#2bootstrapped business, basics already up, full product is prelaunch, maintaining other full-time employment, about $45 a month.
Re: Ask HN: What's your burn rate? What do you do to reduce it?
#3I think this is something that is highly variable - based on personal requirements, cost of living in your country and your acceptable minimum standards of comfort. I think techniques to minimise burn would be more interesting than actual rates.
One tip from my startup: I think a lot of people think getting employees and office space should happen at around the same time. I don't think office space is worth the premium you pay for it until you have more than a couple employees. We have one already and will probably only move after we have employed at least three more. Obviously a caveat here is that the house must be sufficiently pleasant for work and living and that your work is not something that requires client facing offices.
Re: Ask HN: What's your burn rate? What do you do to reduce it?
#4$25k per month for outsourced development team (10+ experienced people, Canada/US based), three full-time employees (Canada), office space, phones, and at a pre-launch stage.
Re: Ask HN: What's your burn rate? What do you do to reduce it?
#5I think this is something that is highly variable - based on personal requirements, cost of living in your country and your acceptable minimum standards of comfort. I think techniques to minimise burn would be more interesting than actual rates. One tip from my startup: I think a lot of people think getting employees and office space should happen at around the same time. I don't think office space is worth the premi…
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Re: Ask HN: What's your burn rate? What do you do to reduce it?
#6I think this is something that is highly variable - based on personal requirements, cost of living in your country and your acceptable minimum standards of comfort. I think techniques to minimise burn would be more interesting than actual rates. One tip from my startup: I think a lot of people think getting employees and office space should happen at around the same time. I don't think office space is worth the premi…
We minimize the burn by:
- keeping a highly active role with the outside developers
- ramping down costs in all areas except development and minor ($1,000 per mo) G&A
- minimal salaries - pay the first employees "rent money", with a quick rampup in salaries once cash-flow positive
- pull in less money - and gives you incentive to figure out how to do things with less money
- keep the 'thinking' in-house as much as possible
- don't hire the wrong people - so that you don't waste time/money with the wrong people
- PLAN - plan your launches, align your strategy and spending, etc.
Re: Ask HN: What's your burn rate? What do you do to reduce it?
#7I think this is something that is highly variable - based on personal requirements, cost of living in your country and your acceptable minimum standards of comfort. I think techniques to minimise burn would be more interesting than actual rates. One tip from my startup: I think a lot of people think getting employees and office space should happen at around the same time. I don't think office space is worth the premi…
Agree with office idea!
Don't sign any long-term leases (over 6 months), and keep it month-to-month. If you start to take off, your damn lease will come back to haunt you... this is a burnt-out economy - grind those leasing agents down, get them to throw in free furniture, free rent, renovations, etc. with the promise that you'll expand out in a couple months with a larger space in the same building. When you get office space - you'll likely need insurance, phone setup, internet, etc... so get the landlord or phone company to throw all these things in for free.
REPEAT: no long-term lease, nothing more than 6 months, and better month-to-month. And nothing beats the kitchen table with a few guys around it.
Re: Ask HN: What's your burn rate? What do you do to reduce it?
#8Business stuff: ~$500/month
Life stuff: ~$1500/month
I had that down to ~$1000 total when I was living on the beach in Thailand and hadn't yet built anything big enough to require a fast machine at a collocation facility.
Re: Ask HN: What's your burn rate? What do you do to reduce it?
#9$25k per month for outsourced development team (10+ experienced people, Canada/US based), three full-time employees (Canada), office space, phones, and at a pre-launch stage.
Holy crap. Pre-launch, so no revenue stream? $25k across 13+ people, plus office space? If you split the 25k evenly, that would be $1.9k each, or a yearly salary of roughly $23k.
What kind of developers are you able to hire for that paltry sum?
In SF -- We spend $30k/month on salary/benefits/taxes for 4 people (not including rent and other expenses), and even then we're paying below market rate. Our other expenses, including rent, add up to $4k, and we try to sock away at least another $10-15k every month.
Of course, this also isn't a "burn" rate. We've worked hard to build a business the old-fashioned way -- by making money with which to pay ourselves.
Re: Ask HN: What's your burn rate? What do you do to reduce it?
#10$109/mo
$100 for rent at a co-working space $9 for unfuddle $0 for heroku