The cost to run a SaaS (with a few million $ ARR)

Inspired by a great post on reddit i took some time to go through the costs of running Prezly. Initially, I figured it would be a great read but at the same time, it's a useful exercise for me to see if there are any services we can get rid of or downgrade.

Just to give you an idea of scale Prezly is a 18 person SaaS product. Fully bootstrapped (no outside capital) and serving about 500 customers globally.

Note: if you have questions/comments about this overview. Feel free to drop a comment in this reddit thread.

The summary:

If you break that down by the number of staff we're looking at a cost of 1250€/month but this includes the server cost. Excluding server costs the tooling per staff member (excluding hardware) is around 712 €/month

🔗

Server Stuff - 9625€/month

We're a software company so obviously, this is the main cost (outside of salaries). These are the minimal infrastructure we need to run the app.

  • Amazon Web Services - Infrastructure - 4000 €
  • Sendgrid - Sending all email campaign - 1300 €
  • Uploadcare - Upload/CDN for all assets (docs, images, files) - 1300 €
  • Algolia - Search (in-app and on newsrooms) - 900 €
  • Sqreen - Application Security - 650 €
  • Nylas - Mail synchronisation for a mailbox feature - 800 €
  • Section.io - Global CDN (for newsrooms) - 450 €
  • Restpack.io - Screenshots - 90 €
  • Iframely - Embed social posts/videos in newsrooms - 90 €
  • Zero SSL - Certificates for customer newsrooms - 45 €

Without any of those tools customers would start complaining. Only AWS, Sendgrid, Uploadcare and Algolia are mission-critical. We have workarounds/failovers for all other services.

🔗

Development/Product/Devops - 1370€/month

All the tools we use to do or work, collaborate and deploy. Canceling all those services would likely not break Prezly but make our work a lot more painful :-)

  • Github - Version Control - 360 €
  • Sentry.io - Report on bugs throughout all apps - 240 €
  • Opsgenie - On-call alerts in case there is a problem - 130 €
  • Glock Apps - Monitoring Email Reputation and Deliverability - 170 €
  • Product Board - Customer Feedback Management + Roadmapping - 120 €
  • Figma - Collaborative Design - 120 €
  • Stoplight.io - Document our API - 95 €
  • Namecheap - Domain Names - 45 €
  • Pritunl - VPN linked to our Google accounts - 45 €
  • Pingdom - Performance and Availability Monitoring - 45 €

🔗

Marketing - 4890€/month

We don't have a sales team so adding up marketing/sales costs in one item

  • Paid - Directories + SEM + paid Social - 1900 €
  • Contentful - Headless CMS to power the website - 500 €
  • Segment - Event Tracking - 850 €
  • Vercel - Hosting of website + various small projects/functions - 250 €
  • Ahrefs - SEO tool, Site audit and Keyword Analysis - 200 €
  • Wistia - Video hosting + Soapbox - 200 €
  • Ahrefs API - API to access data through API for experiments mostly - 600 €
  • Linkedin - Sales Navigator - 90 €
  • Adobe - Premiere + Aftereffects License - 90 €
  • CalibreApp - Continuous Lighthouse Checks (performance and accessibility) - 135 €
  • Grammarly - Spell Checking - 40 €
  • Restream.io - Video Conference Streaming 35 €

To be fair the paid cost is something that is unpredictable and much depending on how confident and aggressive we want to be on customer acquisition. There have been months where we are spending north of 50k in a single month.

🔗

Customer Success - 2881€/month

We don't have a sales team so adding up marketing/sales costs in one item

  • Intercom - Customer Support Chat - 770 €
  • Vitally.io - Support Team Operations - 550 €
  • Fullstory - Usage/Screen recording - 420 €
  • Streak - Customer Relationship Management (CRM) - 300 €
  • Customer.io - Newsletters, Transactional Emails and Various automation - 250 €
  • Aircall.io - Phone numbers + Calling - 170 €
  • BrowserStack - Cross Browser Testing - 120 €
  • Litmus - Testing Email Rendering - 90 €
  • Calendly - Appointment Software - 80 €
  • Hubspot - Previous Customer Relationship Management (CRM) - 46 €
  • Chatlio - Chat with website visitors - 45 €
  • Typeform - Surveying Software - 40 €

Intercom is expensive because we have a 'client day' system where everyone in the company (all 17 of us) take on customer support for one day per week.

I've been complaining about this before and have managed to bring down the cost by disabling some options and keeping intercom for chat support only.

🔗

All Company Tools - 2382€/month

We don't have a sales team so adding up marketing/sales costs in one item

  • Zoom - Video Conferencing - 550 €
  • Mixpanel - Product/Marketing Analytics - 550 €
  • Google Workspace - Google Mail/Calendar - 300 €
  • Notion.so - Internal Knowledge Base - 300 €
  • Linear.app - Project Management Tool - 170 €
  • Slack - Internal Chat - 140 €
  • 1Password - Password Management - 90 €
  • Discourse - Long-form content and discussion board - 180 €
  • Airtable - Better kind of spreadsheet. Used as a database for some internal apps - 62 €
  • Open Collective - Sponsoring some open-source projects - 40 €

🔗

Admin/Finance/Team - 1303€/month

We don't have a sales team so adding up marketing/sales costs in one item

  • Stripe - Customer Billing & Subscription Management - 1100 €
  • Recruitee - Job Site, Application Flow and Candidate Management - 80 €
  • Xero - Invoicing - 80 €
  • ReceiptBank - Now Dext. Manage missing Receipts + OCR - 25 €
  • Timetastic - Team Availability & Holidays - 18 €

--

I posted this post on Reddit and it took off 🚀. I answered a lot of questions in the reddit thread such as:

  • Best/Worst ROI tools? (very opinionated)
  • Why not run Sendgrid ourselves on our own mail server?
  • Should you not be spending more on marketing?
  • Which tools do you use for product measurement/reporting?
  • Detailed breakdown of AWS bill
  • Breakdown of our Stripe subscription