IT Budget Planning for Startups and Small Teams
How much should a startup spend on IT? A practical breakdown of costs for remote teams from 10 to 200 people.
"How much should we be spending on IT?"
I get this question from almost every founder I talk to. The answer depends on your team size, but the framework is the same. Here's how to think about IT spend for a remote startup, with actual numbers.
The categories
IT spend for a remote company breaks into five buckets:
- SaaS tools (the software your team uses every day)
- Security tools (MDM, password manager, endpoint security)
- Devices (laptops, peripherals, replacements)
- IT management (the person or service managing all of the above)
- One-time projects (initial setup, migrations, compliance prep)
Most founders only think about the first bucket. The rest are either invisible or show up as surprises.
SaaS tools: $50-150 per employee per month
This is the core stack. For a typical remote team:
| Tool | Monthly cost per user |
|---|---|
| Google Workspace (Business Standard) | $14 |
| Slack (Pro) | $9 |
| Notion (Plus) | $10 |
| Zoom (Pro, if needed) | $14 |
| 1Password (Business) | $8 |
| Project management (Linear/Asana) | $8-11 |
| Other role-specific tools | $10-50 |
Typical range: $60-120 per employee per month.
For a 50-person team, that's $3,000-6,000/month in SaaS spend. And that's before adding engineering tools (GitHub, AWS), design tools (Figma), sales tools (CRM), or HR tools (Rippling, Gusto).
The biggest risk here isn't the per-tool cost. It's accumulation. Most companies waste 25-30% of their SaaS spend on unused licenses and duplicate tools. Regular audits pay for themselves.
Security tools: $10-25 per employee per month
Security tools are the ones most startups skip until something goes wrong.
| Tool | Monthly cost per device/user |
|---|---|
| MDM (Kandji/Intune) | $6-12 per device |
| Endpoint security (Kolide/CrowdStrike) | $3-8 per device |
| Password manager (included above) | $0 (already counted) |
| SSO (if using Okta vs free Google SSO) | $2-3 per user |
Typical range: $10-25 per employee per month, depending on which tools you deploy.
For a 50-person team: $500-1,250/month. This is the category where startups tend to underinvest. The cost of a security incident dwarfs the cost of prevention. A single compromised email account can cost $10,000-50,000+ to remediate.
Read the complete guide to IT for remote teams for recommendations on which security tools to deploy at each stage of growth.
Devices: $375-750 per employee per year (amortized)
Laptop costs, amortized over a 3-4 year lifecycle:
| Device | Purchase price | Annual cost (4-year cycle) |
|---|---|---|
| MacBook Air M-series | $1,300-1,500 | $325-375 |
| MacBook Pro M-series | $2,000-3,000 | $500-750 |
| ThinkPad T-series | $1,200-1,800 | $300-450 |
Add for peripherals: $200-500 per employee (external display, keyboard, mouse, headset). One-time cost, replaced as needed.
Add for repairs and replacements: Budget 5-10% of your total device value annually for unexpected repairs, screen replacements, and early retirements.
For a 50-person team with mostly MacBook Airs: roughly $1,500-2,000/month amortized, including peripherals and contingency.
Laptop lifecycle management covers procurement, deployment, and disposal in detail.
IT management: varies by model
This is the cost of having someone actually manage all of the above. The three options:
DIY (founder/ops lead handles it). $0 direct cost. But the opportunity cost is real. If you're spending 5 hours/week on IT at a $200/hour opportunity cost, that's $4,000/month in founder time. It's "free" on paper and expensive in practice.
Fractional IT contractor. A flat monthly retainer for a dedicated IT professional. This covers setup, ongoing management, onboarding, offboarding, security, and support. Read more about how fractional IT compares to other options.
Full-time IT hire. $80,000-120,000+ per year in salary and benefits. Makes sense at 100+ employees when there's enough daily work to justify a full headcount.
MSP. $100-200 per user per month, plus project fees. Better suited for office-based teams with physical infrastructure.
Total IT spend by team size
Here's what realistic IT spend looks like at different stages:
10 people
| Category | Monthly |
|---|---|
| SaaS tools | $600-1,200 |
| Security tools | $100-250 |
| Devices (amortized) | $300-500 |
| IT management | DIY or fractional |
| Total (excluding IT management) | $1,000-1,950/month |
At this size, IT spend is roughly $100-195 per employee per month, excluding management.
25 people
| Category | Monthly |
|---|---|
| SaaS tools | $1,500-3,000 |
| Security tools | $250-625 |
| Devices (amortized) | $750-1,250 |
| IT management | Fractional recommended |
| Total (excluding IT management) | $2,500-4,875/month |
This is where fractional IT becomes worth it. The complexity is too much for a founder to handle well, but not enough for a full-time hire.
50 people
| Category | Monthly |
|---|---|
| SaaS tools | $3,000-6,000 |
| Security tools | $500-1,250 |
| Devices (amortized) | $1,500-2,500 |
| IT management | Fractional or first full-time hire |
| Total (excluding IT management) | $5,000-9,750/month |
100 people
| Category | Monthly |
|---|---|
| SaaS tools | $6,000-12,000 |
| Security tools | $1,000-2,500 |
| Devices (amortized) | $3,000-5,000 |
| IT management | Full-time hire or expanded fractional |
| Total (excluding IT management) | $10,000-19,500/month |
One-time projects
Beyond the monthly spend, budget for occasional projects:
- Initial IT setup (for companies starting from scratch): $3,000-10,000 depending on complexity
- SOC 2 compliance: $30,000-75,000 first year
- Major tool migration (e.g., moving from Google to Microsoft or vice versa): $5,000-15,000
- Office setup (if you're adding physical space): varies widely
These don't happen often, but they shouldn't come as a surprise. Plan for one major project per year.
The rule of thumb
For a remote startup running on cloud tools, total IT spend (SaaS + security + devices + management) typically falls between $150-300 per employee per month. Companies at the lower end are underinvesting. Companies at the higher end usually have compliance requirements or premium tool choices driving costs up.
The most important thing isn't hitting a specific number. It's being intentional about the spend. Know what you're paying for, why, and whether you're getting value.
If you want help building an IT budget that makes sense for your team size and growth plans, book a call. I'll walk through your current spend and identify where you're over or under-investing.