The $10,000 per month per employee budget rule has been so accurate for us.
— Danielle Morrill (@DanielleMorrill) July 26, 2014
Estimating a business expenses for a startup is hard. I have long used the back of the envelope rule of thumb that our expenses are roughly $10,000 per employee per month. So it was interesting to see the tweet above from Danielle last week.
Of course this is just a rule of thumb. Different businesses have different variations on the number. For example, a fast food business is not the same. But in general for tech software startups, to support 10 people in a self-funded startup, you need to be doing over $1 million in revenue.
What are your thoughts on this rule of thumb?
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