The Invisible Price Tag of Tech in Startups
As a startup founder, you already know some obvious costs you’ll have when building your tech stack: software licenses, cloud services for your architecture, or tech team salaries.
But there are a lot of hidden costs that can significantly impact your budget and long-term success.
1. Software Development and Maintenance
You can easily set an initial dev budget, with the license costs of the tools you choose. But did you think about:
Bug fixes and updates: Every piece of code, even the most effective and well-crafted, will need regular refactoring and maintenance. Developers spend approximately 17.3 hours per week debugging, refactoring, and modifying bad code. This means nearly $300 billion in lost productivity annually worldwide.
Scaling challenges: As a business owner, your goal is to grow. As you get more users, you will need to refactor your codebase and scale your architecture for better performance. Back in 2016, Instagram had to deal with around 4.2 Billion Likes every single day. To handle this Instagram scaled tens of thousands of Django Servers across the world, activated fault tolerance, and much more.
Security patches: In 2023, attacks against small businesses rose by 42%. During the same year, startups fell victim to a ransomware attack every 11 seconds, and that number will increase to one every 2 seconds by 2031. Cybersecurity threats are everywhere, necessitating regular updates. The average cost of a data breach in 2021 was $4.24 million, according to IBM's Cost of a Data Breach Report 2021. You can read more about security essentials here:
Documentation and knowledge sharing: Your team is a living entity. It will grow, some members will leave, and some will come. A comprehensive documentation is crucial. Ineffective collaboration, exacerbated by poor documentation, results in a loss of 25 billion work hours annually among Fortune 500 companies.
2. Are"Free" Tools and Services free?
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