Business planning · Office Space

Initial Startup Expenses for New Employees

Richard Propper Founder of a Streaming Channels taking the old and making it new.

March 26th, 2018

I'm elbow deep into budgeting for a startup and need to ballpark initial costs for new employees. Some of this may seem obvious, but I'm staring at a spreadsheet and thinking - Computer, Desk, Chair, Coffee Mug, T-Shirt (ok the last two are in jest)...what else? My previous companies it wasn't an issue, but seeing as we're raising money and assembling a larger staff, I need to be as accurate as I can be. Many thanks for your expertise. (BTW - Health Ins and Equity Incentives have already been composed.)

Steve Owens Startup Expert

March 27th, 2018

As a rule, a startup should not hire any employees until it is ready to scale - that is, it has proven it can sell a product/service and make money. Most products/services/business models do not survive first contact with a customer. This means you will likely pivot many times before scaling. As you pivot, the employees you just hired will no longer be suited for the new work.

Erick McKesson Health IT and Operations Expert

March 27th, 2018

On top of what Ann mentioned - consider per user software costs - Office 365, Google Suite, Dropbox, CRM, etc. Also, any benefits like cell phone reimbursement, transportation support, life insurance, dental, vision, 401k match, etc. If you are in a shared workspace add extra memberships. If allowing work from home, make sure you have a provision for monitors, docking stations, etc....and also conference lines, webex accounts, or other communication approaches that might be needed depending on the employee's role.

ann Founder

March 27th, 2018

Health Insurance, payroll taxes, additional local payroll taxes (SF), workers compensation, bonuses, if you are offering meals factor the increase in headcount, bonuses, if you are aware of any conferences in the industry factor for that

BioPartners Clinical Research and Product Development

March 27th, 2018

Some links you may find useful:

Landon Bennett Co-founder, Ad Reform &

March 27th, 2018

Check this out:

Also, you can get almost all your tools for free when starting out. We wrote extensively about the tools we use at Ad Reform:

Biz Ops tools:

Dev tools: