Skip to main content

individual employee costs - and then there are software services

We don't talk about our failures very often.

A few years ago I tried to start my own software consulting company. That business was wildly successful for my father 30 years ago... but as they say "it's not your father's Oldsmobile". The market had changed and every potential client wanted everything for free (including my advice) or they had a kid at home that was a programming savant.

This is an exploration into the cost of an individual contributor at a technology startup. Keep in mind that in broad strokes there are many more expense areas than just tech. For example:
  • customer acquisition
  • administration
  • supplies
  • hardware infrastructure for everything from development to production
  • straight employee costs
  • tools and skills acquisition
  • sustainability
  • taxes
  • product R&D
  • conferences and related networking
I want to focus on "tools and skills acquisition".

The easiest is "skills acquisition". The internet is full of information and there are plenty of YouTube videos to prove it. I get a lot of good information from YouTube, however, I curate that information as quickly as I can. There are too many, would be pros, selling snake oil by the internet minute. (I recently learned that an internet charity was begging me to watch a video for 30 seconds because that was the tipping point at which Google paid them for advertising associated with their video) And now I understand why some material is actually produced. Keep in mind you're not billing if you're learning.

So let's look at some of other "tools" expenses:
  • cloud storage ($15/mo)
  • mail relay (20K emails/$5)
  • programmer's IDE ($500/yr)
  • database ($700/yr)
  • photo editor ($240/yr)
  • other programmer tools
  • word processors and spreadsheet ($300/yr)
  • shared calendars ($700/yr)
  • webinar ($79/mo)
  • screen sharing (first $799/yr)
  • internet connectivity, certificates ($200/mo)
  • distributed source control($1/mo)
  • upgrades and other subscriptions(???)
I'm going to estimate the cost here using $500/yr is about $40/mo. In total that's about $450 before upgrades and subscriptions.

Now consider the company servers. The smallest "micro" server from AWS or GCE costs about $5/mo but that's not practical to run your business. It also does not include VPN, HA, LB, CI/CD, or other critical services. In total you can expect to knockout at least 4 to 8 servers. And if you are serious about availability that might be a factor of 2. That's going to be another $500/mo for the services you're going to use; then there's another few hundred for the services not yet started and machines just warning the ozone.

So that first employee is generating about $12k per year in expenses before the first contract is awarded.

"You can fail at what you don't love so you might as well take a chance on what you do"
-Jim Carrey(video)

Comments

Popular posts from this blog

Entry level cost for CoreOS+Tectonic

CoreOS and Tectonic start their pricing at 10 servers. Managed CoreOS starts at $1000 per month for those first 10 servers and Tectonic is $5000 for the same 10 servers. Annualized that is $85K or at least one employee depending on your market. As a single employee company I'd rather hire the employee. Specially since I only have 3 servers.

The pricing is biased toward the largest servers with the largest capacities; my dual core 32GB i5 IntelNuc can never be mistaken for a 96-CPU dual or quad core DELL

If CoreOS does not figure out a different barrier of entry they are going to follow the Borland path to obscurity.

UPDATE 2017-10-30: With gratitude the CoreOS team has provided updated information on their pricing, however, I stand by my conclusion that the effective cost is lower when you deploy monster machines. The cost per node of my 1 CPU Intel NUC is the same as a 96 CPU server when you get beyond 10 nodes. I'll also reiterate that while my pricing notes are not currently…

eGalax touch on default Ubuntu 14.04.2 LTS

I have not had success with the touch drivers as yet.  The touch works and evtest also seems to report events, however, I have noticed that the button click is not working and no matter what I do xinput refuses to configure the buttons correctly.  When I downgraded to ubuntu 10.04 LTS everything sort of worked... there must have been something in the kermel as 10.04 was in the 2.6 kernel and 4.04 is in the 3.x branch.

One thing ... all of the documentation pointed to the wrong website or one in Taiwanese. I was finally able to locate the drivers again: http://www.eeti.com.tw/drivers_Linux.html (it would have been nice if they provided the install instructions in text rather than PDF)
Please open the document "EETI_eGTouch_Programming_Guide" under the Guide directory, and follow the Guidline to install driver.
download the appropriate versionunzip the fileread the programming manual And from that I'm distilling to the following: execute the setup.sh answer all of the questio…

Prometheus vs Bosun

In conclusion... while Bosun(B) is still not the ideal monitoring system neither is Prometheus(P).

TL;DR;

I am running Bosun in a Docker container hosted on CoreOS. Fleet service/unit files keep it running. However in once case I have experienced at least one severe crash as a result of a disk full condition. That it is implemented as part golang, java and python is an annoyance. The MIT license is about the only good thing.

I am trying to integrate Prometheus into my pipeline but losing steam fast. The Prometheus design seems to desire that you integrate your own cache inside your application and then allow the server to scrape the data, however, if the interval between scrapes is shorter than the longest transient session of your application then you need a gateway. A place to shuttle your data that will be a little more persistent.

(1) storing the data in my application might get me started more quickly
(2) getting the server to pull the data might be more secure
(3) using a push g…