What Does It Cost to Run a $2k/week App Business?

If you’re thinking about starting an app business, you should be considering the costs of running such a business.

Here’s a complete outline of my business costs, it’s a great snapshot of what it takes to make Teleprompter Premium and Video Teleprompter run smoothly.

Developer fees

Firstly, every iOS developer is required to enroll in the Apple Developer Program before you can publish apps to the App Store. This costs $99 for an individual account and $299 for a company account.

I pay the individual $99/year fee. It’s actually £79/year in the UK.

Macs

I do all of the development and programming work myself, which means I need to be using a Mac which is capable of some ‘heavy’ processing (so no Macbook Airs here). I currently have a 2012 27″ iMac, 2011 21.5″ iMac, an Apple 24″ Cinema Display as well as a 15″ Retina MacBook Pro. Here’s the total price if I were to refresh my entire setup new today:

  • 27″ Retina 5k iMac: £1,849
  • 15″ Retina MacBook Pro: £1,599
  • Apple Thunderbolt Display: £899
  • (I wouldn’t refresh the 21.5″ iMac as I no longer need it)

Total cost: £4,347
I’ll Consider this a bi-yearly cost… So let’s say £2,175.50 / year

Marketing

My largest recurring cost is my Mailchimp account. I have a 56,000 subscriber account which costs £198.82/month. Mailchimp and email marketing in general is the backbone of my business.

In the last 90 days, I’ve tracked $3,322 of revenue directly generated from email campaigns (over $1,100/month). I also know that my marketing automation campaigns are driving a lot of attention and helping convert Teleprompter Lite users to Teleprompter Premium customers.

Total yearly cost: £2,385.84

Infrastructure & backend

For Teleprompter Premium and Video Teleprompter, I just use my standard VPS web hosting for features such as the user registration which means I can keep my costs low.

Total yearly cost: £156

If you want to publish an app like Instagram for example, you will need to have an infrastructure in place to host user account securely, thousands of user’s posts (image files), securely and regularly backup the data etc. These costs can be high even if you have very few users (if any) and can quickly become monumental when you start seeing thousands of daily users.