How Much Does It Cost To Build A SaaS Platform?

Web development is a lot like construction. A project plan / map is shared with every stakeholder and then there is a business analyst, project manager, designer, developer, and more. However, the main difference is that you don’t get into material cost but a software cost and cost of human capital/ developers.

When you are building a SaaS platform, you are building a business. Not a random or passive income business. With a SaaS platform, you need support, community, etc. and that takes money. Some of the things you will need are: hosting, CRM software, tracking software, insurance, building software, on-going development work etc.

Most people think that once they are done with the development and platform deployment, they are done with the software and the costing but that’s not true. What happens if your server goes down?

In this blog post, we will explore how much does it cost to build a SaaS platform, and what our experiences are as a SaaS development company.

Table of Contents

SaaS tools vs. platforms

There are two kinds of SaaS systems i.e. tools and platforms. A SaaS tool does a thing or two and a really good example is Buffer or hootsuite which are primarily used for posting on social media.

Whereas a platform is a fully featured sort of system. A good example is of Asana and Facebook. Asana is a project management system but it does a lot of work. It manages teams, projects, calendars, reminders, meetings etc.

Cost of building a SaaS tool typically ranges from $20-150k. Whereas the cost of building a SaaS platform is $50-300k.

General build or validate idea

If you are in fear of losing a good amount of money, you should go for general build for validation of your business idea. One of the common mistakes from the client’s side is that they spend about half of their budget on original build without knowing if the product/platform would actually work in the market or not.

Send that build into different groups for testing purposes. This does involve the development team and the basic SaaS development feature platform may take 10-50 hrs.

Well planned projects are affordable ones

The more planned your project is, the quicker it would launch in the market. Also, it would cost you much less in the long run.

Planning can take as much as 30-100hrs, depending upon the project.

UX design can take 25-75hrs depending upon the complexity of the project.

Freelancers vs. Agency

Let’s discuss rates of SaaS developers per region.

  • Pakistan – $20-35/hr
  • Southeast Asia – $15-40/hr
  • US – $35-250/hr
  • South America – $40-70/hr
  • Eastern Europe – $30-80/hr
  • Western Europe – $40-120/hr

Freelancers are less expensive if compared with an agency. However, work ethics are mostly better working with an agency. They cost more because they have to cover expenses like developers, quality control, project management etc. but on the plus side they take full ownership which is important for your project success.

Also, you don’t have to micromanage each freelancer/developer. Agencies have teams for each step of the development process which is why they promise shippable value delivery.

Phaedra Solutions witness clients facing issues with their freelance workforce every day. If you want a total commitment for your project, hire our SaaS developers.

SaaS development pricing examples

  • A B2B SaaS platform requires 30 weeks approx. (20 hrs/ week) for a solid MVP. Approx. cost – $2500
  • A successful SaaS MVP with the minimum features cost around $1500
  • Advance features SaaS platform for a niche market along with testing around $100k
  • A directory with advance searching and admin panel around $40k
  • Industry specific management systems can take 1year to several and cost surge can go up to $500k
  • A project planning and scoping tool with initial build could cost in between $30-50k.
Total cost of developing a SaaS platform or a tool system depends on the choices you make as an owner.

Final Verdict

If you are building a SaaS platform for the first time, we suggest keeping the scope limited. Also, a common practice we have seen is that the time is underestimated which is required to build a system and the realization of additional expenses often popup later on the road to development.

Let’s grab a cup of coffee and start estimating the actual cost for SaaS system development. To make things clear, your SaaS development costs encircle much more than the coding.

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