Fintech startup cost depends on various factors. The moderate cost of a mid-level startup starts from $10,000. Even you can start from $5000 for a small fintech startup. But there is no linear equation that you could easily calculate the cost of a fintech startup. Rather if you are in the very early stage of a fintech startup or if you are thinking of any new fintech app or services you welcome the dirty math.
Fintech startup cost varies for many reasons. Especially this cost depends on the scale of business. Some startups have huge ideas to continue but some start with simple basic ideas. This is the baseline for the cost of a fintech startup.
Besides this many startup founders are real firefighters who can code for their own idea, have smart marketing minds for clients and hunt for investment on their own. Their cost is much lesser than any other startup.
Some fintech startup loves to collaborate with an outsider for many solutions. If they are stuck in any situation they hire a third-party vendor to solve those areas. In long run, they need to cost higher than the first group.
There is a third type of startup cost exist: That startup looks like a heavy posh business. The founder of that startup is a rich kid. They literally do extra cost for every part. They hire professionals for every part of the business. They maintain a gorgeous office decoration from the very beginning.
I meet those three groups of startup founders. Founders who don’t know firefighting must not be in the fintech startup race nowadays. It’s a mean nasty area.
What is the very common cost of a fintech startup?
There are some common costs for all fintech startups. The main goal of this blog post identifies your core need for fintech startup costs.
- Idea generation cost
- Market Research cost
- Registration cost
- Website development cost
- App development cost
- Branding and promotion cost
- First 100 client hunting cost
- Manpower cost of fintech startup
- Office expense cost
- Consultancy fee
Before going to dive into details about the costing and budgeting of a fintech startup. You might need to calculate your effort as a cost or investment. Ie; if you design or develop a website for your startup you might add this cost when you calculate the cost or budget it. Give value to yourself so that when it’s time to evaluate your startup your effort might not be missed.
Fintech Idea generation cost:
The idea is king for any fintech startup. But this king will not come to your dream every day. Or you will never create any idea at all. You need to read huge about the fintech industry to find new ideas and business scope in this field. Or you can hire someone idea to execute. There is industry expert you can communicate with them from fresh fintech business idea.
You might see many business case competitions around you. Those are the gold mine for ideas. The cost of ideas varies from time to time man to man. In general, you could budget $500 for a fresh fintech business idea.
There is a famous quote about ideas
“If you don’t have any idea. Someone will hire you to execute their idea.”
Market Research Cost:
STOP!!! Yes, I say Stop reading this article. Some of you might very much excited to find an excellent idea. But all the time an excellent idea might not lead you to success in a fintech startup. Do extensive market research and continue it until you know all the pros and cons of this market. The more you spend in this part the more you could succeed.
You must spend tons of hours on competitors’ analysis what is their strengths and weakness. By finding those you can create room for your business.
You can do this at your own cost or take help from experts. Payment of expert market researcher could be on the basis of an hourly rate. On average the cost of market research for a new startup should in between $2000.
Registration Cost for fintech startup:
In this section, you have nothing to worried or decision making. Whether you want to register as a solo fintech startup or a private limited company cost varies from $10 to $100. But this cost varies from country to country.
Besides that registration, you can register your brand in the different local fintech communities. So that you can attend different meetings and seminars.
Fintech startup: Website development cost
In almost all fintech startups there is at least one coder among the founder. So the development of a website cost most of the time can be detected. If not you can easily build up a dynamic website by using WordPress or any other CMS.
But if you want to outsource this part you might not keep a budget of $5000 to invest in this section. And a monthly maintenance fee will be between $300 to $500.
Actually, this budget depends on the UI and UX of the website, the Content of the website, and the Use-case of this website. If you want to build a complex payment gateway you might need to invest more and vice versa.
Cost for fintech app development:
Nowadays a fintech startup means an app-based financial solution to any problem. So an app is a must in a fintech startup. The cost of developing an app varies with many factors. It’s to suggest that any fintech startup could hire a team of app developers combined with UI designers and UX developers, and an App tester so that a moderate level of an app can be maintained for the client base.
The moderate Cost for mid-level app development is between $4000 to $6000.
Branding and Promotion Cost
This is my famous area, I love to talk to this much. If you need any help regarding branding and promotion let me know. Most fintech startup faces problem in setting branding and promotional budget.
Keep it simple use 8-10% of your yearly earnings for marketing expenses. But when you start working on your idea. Try to reach your friend and family and collect some feedback from your services. For a service-based fintech startup, your first batch branding budget should be at least $5000.
First 100 Client Hunting Cost
The basic difference between a successful startup and a failure determines in this-parts. This is the most crucial part of any entrepreneurial journey. With your team, every startup must hunt the first 100 clients together. Strong teamwork and commitment are needed for this success. There are some extra costs that may occur.
Manpower cost of fintech startup
I love to say it’s a cost of human-ware. All of your costs and budget will go to ruin if you don’t have enough smart manpower. Finding efficient manpower and training them is the toughest job for a startup.
Spending too much or spending less both are harmful. It is believed for a perfect startup you can budget 25% of your income. But for the very beginning stage try to spend less work more by own. If you need an urgent teammate, try to hire a freelancer so that you don’t maintain office stuff for him/her.
Office expense cost
Do not budget for fancy office stuff. Try to minimize costs in this section in the very early stage. I know many startups grow from the bedroom they don’t need any office equipment until the first client arrives at their office.
Try to build this type of mentality. Dream of luxury office fittings for the future. Continue with basic needs. Cost of office expenses include
- Computer
- Printer
- Hardware and networking tools
- Furniture
- Other miscellaneous stuff.
What will be a perfect cost for this section depends on various factors. In general, if you are a small startup you could spend up to $5000. The lesser the better.
Consultancy fee
Most fintech startup founders, thought they are all in one. They don’t need an external consultant for their business. If you pay an extra $400 to $500 in this section you could save $4000 to $5000 each month.
Basically, The consultancy fee depends on profit. You can contract you will pay them 1% of your total net income or more or less. In another way, you can hire a consultant on pay per hour basis. The range of pay-per-hour consultancy fees for fintech startups starts from $35 it could be $350 too.
Fintech budget for a mid level startup.
| Title | Expected Cost |
| Idea generation cost | $500 |
| Market Research cost | $2000 |
| Registration cost | $100 |
| Website development cost | $5000 |
| App development cost | $4000-$6000 |
| Branding and promotion cost | 10% of yearly income |
| First 100 client hunting cost | |
| Manpower cost of fintech startup | 25% of yearly income |
| Office expense cost | $5000 |
| Consultancy fee | $1000-$2000 |
Knowing about fintech startup costs before jumping into this fight is uber important. A startup is a firefighting job, You could handle all the aspects of your startup. From coding to marketing, to cost optimization you need to take a smart decision. But at the same time, you have to decentralize many decisions. My suggestion for you try to cost minimize until the first 100 clients hunt.
