SaaS Development Costs: Estimates, Stages, and How to Save Money
September 15, 2025•8 min read
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Author: Alex Vasylenko | Founder of The Frontend Company
Building a SaaS product in 2025 isn't the same game it was five years ago. Competition is tougher, AI has become a baseline, and enterprise buyers hold higher standards than ever before.
The good news is that you don't need all the money in the world to build a nice product if you understand where the real SaaS development costs are hiding and what you can do about them.
In this article, I'll break down exactly what it takes to build a SaaS product stage by stage and show you how much it might cost to make products like Slack, Zoom, or Shopify today. By the end, you'll know what to expect, where to invest, and how to save money during SaaS development.
SaaS Global Market Overview
Let's start by reviewing the SaaS market. Understanding the global numbers of SaaS development is crucial for making informed decisions and planning your product effectively.
From 2023 to 2025, the SaaS market has added over $60 billion in annual revenue. In 2023, global SaaS revenue was around $253 billion, rising to $266.2 billion in 2024 and to $315.7 billion in 2025.
Analysts predict this trajectory will continue, reaching $1.13 trillion by 2032. This growth demonstrates the industry's resilience and high demand across enterprises, even as competition is overwhelming and product expectations from users rise every year.
The reasons behind these rising numbers are:
More companies are buying SaaS. As more businesses move from outdated software or manual processes to modern SaaS tools, they bring new revenue into the market.
Companies spend more per employee. Average SaaS spend per worker continues to rise as teams increasingly rely on more tools and premium plans.
SaaS is expanding into new industries. Sectors like healthcare, logistics, and manufacturing are starting to use SaaS for the first time.
Vendors are selling more add-ons and upgrades. AI features, integrations, and extra modules create new paid options inside existing products.
Global shift to digital work. Remote work, online communication, and connected devices create constant demand for more and better SaaS tools.
Metric | 2024 | 2025 |
|---|---|---|
Global SaaS market revenue | $266.2 B | $315.7 B |
Avg. SaaS spend per employee | $3,960 | $4,830 |
SaaS Development Costs Estimation Based on Product Type
To make an approximate estimation of SaaS app development costs, we need to consider two crucial factors: product complexity and team model.
If you need a more precise and tailored estimation for your unique project, book a FREE 1-hour consultation with Alex, the Founder of The Frontend Company. He will help you choose the best approach for your SaaS development needs and provide impactful recommendations.
SaaS Costs by Product Complexity
The cost to build a SaaS product isn't just about the hourly rate of your team — it heavily relies on how complex the product is.
Complexity means how many features you need, how polished they must be, how many people it takes to build them, and how much testing they require.
A simple MVP with few features can be built by 1-2 developers in 4-8 weeks for a modest budget. However, adding multiple user roles, live dashboards, third-party integrations, or enterprise-level complexity can quickly increase hours and costs.
That's why two SaaS projects built at the same hourly rate can have radically different price tags — complexity changes everything.
The table below shows how SaaS costs scale from a basic MVP to an enterprise-grade platform.
Complexity Level | Typical Scope & Features | Estimated Cost Range (USD) |
|---|---|---|
Micro SaaS | A small product focused on a single use case. Basic login, minimal UI screens, core functionality, and a simple admin panel. | From $15k |
Startup SaaS Costs | Small-mid project with user accounts, subscriptions, main workflows, profile management, basic reporting, and a few simple integrations (e.g., payments, email). | $35k–$80k |
Growing SaaS | Product with expanded feature set: advanced subscriptions, multiple user roles, richer admin panel, several third-party integrations, and polished responsive UI. | $80k–$250k |
Advanced SaaS | Complex platform with different workflows, integrations with enterprise systems (ERP/CRM), AI-driven features, and multiple workspaces. | $250k–$600k+ |
Enterprise Platform | Large-scale product built for thousands of users. Full multi-tenant architecture, deep customization, advanced analytics, high security, and industry-specific compliance. | $600k–$2M+ |
SaaS Costs by Team Model
Choosing who develops your SaaS is just as important as deciding what to build. The partnership model you pick affects SaaS development cost, speed, your time, and workflow. The most common approaches for these projects are in-house teams or an outsourcing development agency.
Here is a detailed breakdown of the costs depending on the team model:
Team Model | Description | Typical Hourly Rate (USD) | Pros | Cons |
|---|---|---|---|---|
In-house team | You hire full-time employees who work only for your company. | $60–$120+ | Full control, deep product knowledge, easy communication. | Need time to hire, high fixed costs, limited flexibility if needs change. |
Freelancers | Independent contractors are hired per project or task. | $25–$100 | Low initial cost, flexible to scale up and down. | Quality and availability vary, risk of low accountability, and harder to coordinate for large builds. |
Outsourcing Agency like TFC | Partner with an agency that provides a full, managed team (devs, QA, designers). | $40–$90 (Eastern Europe) | All roles covered, proven process, predictable delivery. | Less direct control than in-house; requires clear communication and trust. |
Hiring a few freelancers may seem like the cheapest option, but it rarely works well as they often lack the stability, depth, and coordination needed for a complex SaaS project. We recommend hiring freelancers only for small tasks or prototypes.
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What Would It Cost to Build Slack, Zoom, or Shopify in 2025?
In this section, we'll take three well-known SaaS products — Slack, Zoom, and Shopify — and estimate how much it would cost to build MVP and full enterprise versions of them in 2025.
We'll count it as if a client came to TFC with a request to create a similar product. All numbers are based on current market rates, Eastern Europe team costs, and our experience delivering complex SaaS builds.
Slack
Slack is a cloud-based team collaboration tool that combines messaging, file sharing, and app integrations into a single workspace. Known for its intuitive interface and task management, it has become a perfect communication and collaborative platform for startups and enterprises alike.
Slack's core SaaS features include:
Direct and group messaging
Searchable message history
File sharing
Basic integrations like Google Drive, calendar apps
Notifications and mentions
Cost to build:
MVP — If a client came to TFC for building a functional Slack alternative with just the essentials, we'd estimate $100k–$150k using an average Eastern European dedicated company rate (70$/per hour).
Full Enterprise Version — To launch something close to today's Slack, with multi-platform support, advanced features like video calls, custom integrations, enterprise admin controls, compliance, and global-scale infrastructure, the cost would be $1M–$1.5M+.
Zoom
Zoom is a cloud-based video conferencing platform that delivers high-quality online communication through video, audio, and screen sharing. Its simplicity, reliability, and affordability have made it a market leader for remote work, education, and virtual events.
Zoom's core SaaS features include:
Video conferencing (1:1 and group calls)
Screen sharing
Chat functionality during calls
Meeting scheduling and joining via link
Audio controls (mute, unmute, volume adjustment)
Cost to build:
MVP — If a client partners with us for a basic Zoom-like product focused on reliable video calls and screen sharing for a single platform, we'd estimate $200k–$300k with an average Eastern European dedicated company rate.
Full Enterprise Version — Modern Zoom's features — multi-platform support, breakout rooms, whiteboarding, webinar hosting, integrations, and enterprise-grade security — would push the cost to $1M–$1.8M+, depending on scale and compliance needs.
Shopify
Shopify is an e-commerce platform that allows businesses of all sizes to create, customize, and manage online stores without heavy technical overhead. It's known for its ease of use, scalability, and extensive app ecosystem, powering millions of merchants worldwide.
We've had the opportunity to work with Shopify as a client in the past, helping enhance frontend performance and user experience for their high-traffic merchant dashboards. That experience gave us unique insight into the scale, complexity, and attention to detail a platform of this caliber requires.
Shopify's core SaaS features include:
Store creation with customizable themes
Product catalog management
Shopping cart and checkout process
Basic payment gateway integration
Order and customer management dashboard
Cost to build:
MVP — If a client came to TFC wanting a simplified Shopify-like platform for launching online stores with core features, we'd estimate $250k–$400k. This would include a storefront builder, basic payments, and essential store management tools.
Full Enterprise Version — Developing something close to today's Shopify — with multi-channel selling, advanced inventory management, payment integrations worldwide, robust analytics, and enterprise-grade performance — would require $1.5M–$2.5M+, depending on scope and scale.
Product | Core MVP Scope | Est. MVP Cost | Full Enterprise Scope | Est. Full Cost |
|---|---|---|---|---|
Slack | Direct & group messaging, searchable history, file sharing, basic integrations, notifications | $100k–$150k | Multi-platform, video calls, custom integrations, enterprise admin, compliance, global-scale infra | $1M–$1.5M+ |
Zoom | Video calls (1:1 & group), screen sharing, in-call chat, scheduling, audio controls | $200k–$300k | Multi-platform, breakout rooms, webinars, whiteboarding, integrations, enterprise-grade security | $1M–$1.8M+ |
Shopify | Store creation, product catalog, checkout, basic payments, order dashboard | $250k–$400k | Multi-channel selling, advanced inventory, global payments, analytics, app marketplace, enterprise performance | $1.5M–$2.5M+ |
A Simple Formula for Estimating SaaS Development Cost
You don't need a 40-page proposal to get a rough idea of your SaaS development budget. While exact numbers require proper discovery, there's a quick formula you can use to gauge development costs before talking to an agency.
SaaS Development Costs Formula:
Cost = Total Development Hours × Average Hourly Rate × (1 + Contingency %)
Total Development Hours — Estimate the hours based on product complexity:
Simple MVP: 500–800 hours
Mid-sized SaaS: 1,000–2,000 hours
Enterprise-grade: 3,000+ hours
Average Hourly Rate — For Eastern Europe, quality agency rates average $50–$70/hour (Clutch & GoodFirms reports). We will use 70$/per hour.
Contingency % — Typically 15–30% to cover unexpected scope changes, integration issues, or extra QA cycles.
Example:
A mid-sized SaaS project estimated at 1,500 hours × $70/hour = $105,000 base.
Add 20% contingency → $126,000 total.
Why it works:
Keeps early-stage budgeting transparent and straightforward.
Encourages realistic buffers for the things you can't predict in a scope doc.
Gives you a quick reality check before you commit to design or fundraising.
Just follow these steps, and you'll get 85–90% of the actual SaaS development cost.
💡 Need a precise estimate for your SaaS project?
Book a consultation with TFC, and we'll give you an exact number with stage-by-stage cost clarity.
How We Estimate and Plan SaaS Projects at The Frontend Company
At The Frontend Company, we believe the best SaaS products are built when both the client and the development team work as one. That's why our estimating and planning process is designed to be transparent, collaborative, and fast, so you always know what's happening and why.
Here's how we do it:
1. Discovery
We begin with a call with Alex, where you discuss what problem your SaaS solves, who will use it, and what "success" looks like for you. We also separate the features into essentials for launch and ideas for the future.
What we need from Client: A clear description of your idea, your audience, and any sketches, wireframes, or examples you've seen and liked.
Why it matters: A strong shared understanding early on prevents scope creep and avoids costly changes later.
2. Architecture
Once we know what we're building, we choose the right tech stack that best fits the requirements and the client's scalability needs. We also plan the structure of the system so it can grow with your business.
What we need from Client: Preferences on tools, compliance requirements (e.g., GDPR, SOC2), and any existing systems we should connect to.
Why it matters: Good architecture makes your product faster, more secure, and easier to maintain, saving time and money in the long run.
3. Breakdown
After choosing the architecture and tools, we divide the project into smaller parts of work. Each gets an estimate for hours, cost, and timeline. This gives you a clear picture of where your budget will go.
What we need from Client: Decisions on which features are must-haves for launch versus what can be postponed.
Why it matters: With a good plan and breakdown for prices and timelines, you can control costs and prioritize the most impactful features.
4. Validation
We review the plan together, checking that it matches your goals and budget. This is your moment to suggest any adjustments before we start coding.
What we need from Client: Feedback, approval, and alignment with your stakeholders.
Why it matters: Ensures we're all on the same page.
5. Delivery
This is where our team starts its job. Every week, we prepare a clear report and schedule a call to walk you through what's been done, what's next, and gather your input.
What we need from Client: Quick answers to our questions and feedback on what you see during reviews.
Why it matters: Weekly updates and direct discussions keep everyone aligned, avoid surprises, and make sure the project stays on track for launch.
6. Post-launch
Once your product goes live, our job doesn't stop. We stay with you to fix bugs, roll out improvements, and support scaling as your user base grows. You'll continue receiving regular check-ins, quick fixes when needed, and advice on the next steps to keep your SaaS strong and competitive.
What we need from Client: Share feedback from your users and tell us what's working (and what's not).
Why it matters: Early fixes and improvements after launch save money, protect your reputation, and ensure your product continues to perform as expected.
5 Ways to Reduce SaaS Product Development Costs
Building a SaaS product doesn't have to drain your budget. I see many founders overspend not because the project is complex, but because of poor planning, wrong team setup, or unnecessary features. Here are five ways to keep your costs under control while still getting a quality product.
1. Start With a Lean MVP
Don't try to build the "final" version on day one. Focus on the core features that solve your users' main problem. Adding advanced dashboards, complex integrations, or AI before validating your idea only burns cash.
Pitfall: Cutting too much. If your MVP is too bare, users won't see its value. Strike a balance — enough functionality to test the market, but no "nice-to-have" extras.
2. Define Requirements Upfront
Changing scope mid-project is one of the fastest ways to double your costs. Spend time in discovery to document user flows, feature priorities, and technical requirements. This gives your team clarity and prevents endless revisions.
Pitfall: Overplanning. Avoid writing a 100-page documentation. Keep it simple but structured so your team can execute without constant changes.
3. Choose the Right Team Model
Your choice of who builds the product directly impacts costs.
In-house hires mean salaries, benefits, and long-term commitments.
Freelancers may look cheap, but reliability and accountability are risky.
Agencies (like TFC) give you a full-stack team and proven processes without overhead.
Pitfall: Chasing the lowest hourly rate. A weak team working slow is more expensive than a skilled one working efficiently.
4. Reuse Instead of Reinventing
Don't build everything from scratch. Use existing tools and frameworks where possible: payment gateways, authentication modules, analytics dashboards, or cloud services. They're cheaper and more secure than rolling your own.
Pitfall: Overdependence on third parties. If you rely too heavily on external tools, scaling or customizing later can become expensive. Pick reusable components wisely.
5. Test Early
Bugs discovered late in the process are much more expensive to fix. Regular QA and early testing (even clickable prototypes) catch issues before they snowball.
Pitfall: Skipping QA to "save money." It always backfires with higher maintenance costs, poor user experience, and lost customers.
Final Word
SaaS development costs are never a single number — they depend on countless factors: from the complexity of your product to the team model you choose, to how well you plan and manage the process.
The truth is, without the right approach, it's easy to burn money on the wrong features, poor planning, or inefficient execution.
The good news is that these risks can be managed. By focusing on clear priorities, choosing the right development model, and sticking to proven practices, you can significantly reduce costs while still building a high-quality product.
Of course, doing this alone is tough.
That's why we invite you to book a free consultation with our CEO, Alex. In just one session, you'll get a realistic, close-to-market estimate of what your SaaS project may cost — and a clear understanding of where you can save without cutting quality.
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FAQ
Alex Vasylenko is the founder of The Frontend Company, DBC and several other successful startups. A dynamic tech entrepreneur, he began his career as a frontend developer at Deloitte and Scandinavia's largest banking company. In 2023, Alex was honored as one of 'Top 10 Emerging Entrepreneurs' by USA Today.
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