How much do you spend on SaaS a year?

How much does a startup spend on common SaaS each year? Building our 2022 budget, I reviewed all the bills services we use and have used here at Alpe Audio. Here’s the breakdown of how much we spend and on what.

Two notes:

• Prices are for one user.
• Stop reading and GO THROUGH YOUR SAAS BILLS. I just saved $1000+ by reviewing our bills meticulously and cancelling services that I no longer use.

We have five main categories of expenses, overall paying $9460.

1. Infrastructure + Productivity: 7%
2. Data: 48%
3. User communications: 33%
4. Website: 1%
5. Additional services: 11%
6. Other common SaaS we’ve used in the past

Data and User communications is the lion’s share of our annual expenses and we’ll see below which services cost the most. These services’ cost scale with user growth and are most important for understanding and communicating with our users – the lifeblood of our business. They also have lock in which makes it harder to switch and gives them pricing power.

Infrastructure and Productivity SaaS costs

The three key choices for this category are which:

• Office suite do you use? Google or Microsoft?
• Cloud provider? AWS/GCP/Azure are the go to here.
• Productivity SW? Monday.com, Asana, ClickUp, Notion, Jira, whichever you choose – there are lots of options and the lock in they have on your business is also real, and scales up by user count.

Cloud providers bills also scale with usage, but luckily they offer lots of credits for early day development. Get them!

Data Saas Costs

Mixpanel, Segment and Appsflyer costs all scale with usage, so they get high pretty quickly. Mixpanel and Segment both offer good startup packages, so this has been a long delayed expense, but have to pay the piper at some point! These are critical data tools for us, probably for you as well.

User communications SaaS costs

Intercom says it all here. Beast of a use case, but beware of starting to use it because that cost scales FAST. We use Intercom for our in app help desk, notification and onboarding flow & occasional monthly emails.

Website

Nothing fancy to see hear! DNS service, Elementor pro for editing on WP and shoutout.so to share some Twitter love.

Additional services

Soundstripe, Otter.ai, Descript and OpenAI are all key tools for our audio course creation process at Alpe Audio. Typefully is my primary tool for publishing on Twitter. Every business will have a different stack here.

Other common SaaS we’ve used in the past

There are so so many SaaS services used in small startups. We use these on and off on a ‘as needed’ basis. Individually, per month, per user, the pricing works. But the cost rises very quickly if you add users or forget to cancel your subscription, something that many of these companies hope for.

So how much do we spend on SaaS? All in, we’ve been spending at least $10,000 a year on SaaS, and that’s just for one user. These costs scale quickly with additional users and are easy to lose track of. Keep a tight rein on this!