How much does it cost to start a business?
Startup costs fall into two buckets: one-time expenses to open the doors, and ongoing operating costs you must cover until revenue catches up. Many new businesses fail not because the idea is bad but because they run out of cash before reaching break-even.
Typical one-time costs
- Business registration, licenses and permits
- Equipment, tools, computers and furniture
- Security deposits and renovation
- Opening inventory
- Logo, website and launch marketing
How many months of runway?
Six months is a common minimum. Businesses with long sales cycles or seasonal revenue may want 9–12 months. Use the break-even calculator to estimate when sales will cover costs.
FAQs
Can I deduct startup costs?
In the US you can generally deduct up to $5,000 of startup costs in your first year, with the rest amortized over 15 years, subject to limits. Confirm with a tax professional.
Why add a contingency buffer?
Costs almost always run over. A 10–20% buffer protects against surprises like delays, price increases and slower sales.
Should I include my own salary?
If you need to pay yourself during the runway period, yes. Add it to monthly operating costs.