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Comment by wordofx | Hacker News Reader

> Building and running your own software team is probably around $5M/year

Do people just pull random numbers out of their ass with no actual experience? 99% of developers do not live in Silicon Valley on 1m salaries.

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> Do people just pull random numbers out of their ass with no actual experience?

That’s a weird question to ask someone who stated their relevant experience in the first sentence of their comment. I just looked him up on LinkedIn and it checks out, you can do the same.

If you have substantive objections to what he wrote, perhaps it’s better to state them explicitly? You seem to say that the figure he suggested is based on developers being based in a very expensive location, and therefore not generalizable.

What numbers have you come up with that contradict his?

His prices are so wild that I would be surprised if anyone agrees with him.

~10 FTEs, US, 75% percentile salaries, fully loaded, 1.5-3M. Figure that team salaries is probably about 50% of the total software cost (hosting, support, tooling, on call, management overhead, recruiting, training etc)$3-$5M. Rounded to the nearest 0.5 for convenience. We got about ~4 bits of data from the OP, so I didn’t put too much work into making my estimate precise. I prefer to get the ‘software is fucking expensive and terrible’ experience on the front end and go from there, if people are still into it.

Lol

Avg salary in the U.S. is 105k. Better to go on average as you’re not going to high 10 seniors. That would be dumb. Hell getting 10 for an in house app is just as dumb. Hosting? On an in house app. If they spend more than 100k in the first year that’s dumb too. Support for an in house app? That’s part of the dev team. Tooling? For what? Some IDEs and few dev tools like slack etc. Let’s bundle it with their equipment. 100k for some computers and software.

I don’t understand how HN has to always look at the extreme pessimistic side to everything. The type of people here are the ones who go into a business and spend insane amounts of money building junk software wanting to pull in 5 different databases, 3 caches, elastic search and host their 10 years on 25 “microservices” hosted in docker that falls over multiple times a day when 95% of the software people on HN build could be hosted on a couple of load balancer servers with a single db instance. Spend way too much money trying to solve non existent problems.

Cost is not just salary. To begin with, health insurance and other benefits. And they'll need dev environments, they may need additional cloud resources depending on how the project goes, and there will be additional overhead when the team interacts with other departments.

OP is in Europe - no idea in which country but just as an anecdotal example, building a world-class dev team in Estonia is ~100k per senior engineer (total cost, including health insurance etc). Of course there are auxiliary costs in addition to the team itself but not anywhere close to 4.5 mil/year for a 5 person team.

And to be honest, I'm not convinced a moderately complex in-house crud app would really require 5 senior developers but impossible to have a strong opinion on that based on the details that OP provided. It might be a one man job, it might take a team of 10..

I agree that the cost seems overblown but having worked on several very small teams I'd be hesitant to start anything new with fewer than four people. It is possible to get things done with a one or two person team, it's just a lot harder because the moment someone gets sick or goes on holiday everything grinds to a halt. If what the team is working on is on the critical path for doing business it effectively becomes impossible for anyone to have a real holiday, if something breaks then they're going to get roped in to fix it regardless.

If you have a four person team you drastically reduce the bus factor. It also means you can have people routinely pairing on things which can be hugely impactful when working on new software in a new domain like this.

So you’ve barely added anything to the cost on top of salary. Depending on where you live in the world there is no extra costs on insurance or other benefits. Cloud resources on a brand new app in development? Let’s be generous and say 100k/yr for the first year. (If they were using more than that I would fire them as they clearly have no idea what they are doing)

But let’s say they have a 5 man team for in-house development. 1.5m/yr would be a stretch to spend.

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