How to budget for your app's first year

Plan your app's first year as the build cost plus roughly 25% to 50% more for everything that happens after launch. For a focused first version built by a professional US team, that often means a build starting around $25,000 and a first-year total meaningfully higher once you add store fees, hosting, third-party services, fixes and marketing. The build is the biggest line, but it is the post-launch lines that catch most first-time app owners out.

Below is each line of a first-year budget, what drives it, and how to keep it under control.

The first-year budget at a glance

Discovery and design

Discovery is the work of deciding what the first version does, who it is for, and what it will cost to build. It usually ends in a feature list, a clickable prototype of the main screens and a fixed or tightly ranged quote.

It feels like a cost you could skip. In practice it is where most money is saved, because changing a screen in a prototype takes an hour and changing it in a finished app takes days. Our guide to the app discovery phase walks through what you should get from it.

Our App discovery sprint is $2,500 and takes two weeks: workshops on users and goals, a ranked feature list, a clickable prototype, a technical plan and a fixed quote for the build.

The build

The build is the largest line in year one. What moves the number:

• Number of features in the first release. Every screen, role and edge case adds design, development and testing.
• Platforms. Building iOS and Android from one cross-platform codebase usually costs less than two native apps. Native makes sense when the app leans heavily on device hardware.
• Integrations. Payments, booking systems, CRMs, wearables or custom hardware each add work.
• Admin panel. Most business apps need a web dashboard for your staff to manage users and content.
• Compliance. Health and financial data bring extra security and legal requirements.

Market prices vary widely. A focused first version from a professional team often starts in the mid five figures, and complex platforms run well into six figures. Our app development cost guide breaks down the ranges.

For reference, our MVP app package starts from $25,000 for a first release on iOS and Android from one codebase, with user accounts, core features, push notifications, an admin panel and store submission, over 10 to 16 weeks. Native apps, compliance-heavy work and multi-client platforms start from $60,000.

Developer accounts and store commissions

These are small but fixed:

• Apple Developer Program: $99 a year.
• Google Play developer registration: a one-time $25 fee.
• Store commissions: if you sell digital goods or subscriptions inside the app, Apple and Google usually take 15% to 30% of each sale. Physical goods and services, such as a booking for a haircut, are generally paid through your own payment processor instead.

Set up the developer accounts in your company's name, not your developer's, so the app listings belong to you.

Hosting and backend services

Your app talks to a server that stores accounts, data and files. For a small app with modest traffic, cloud hosting and a managed database often cost tens to a few hundred dollars a month. The bill grows with users, stored files (photos and video are the expensive part) and anything that runs constantly in the background.

Ask your developer for an estimate at three sizes: launch, 1,000 active users and 10,000 active users. If they cannot give one, ask why.

Third-party services

Most apps rent features instead of building them:

• Maps and location
• SMS for login codes and alerts
• Transactional email
• Payment processing, which typically charges a percentage plus a fixed fee per transaction
• Crash reporting and analytics
• Video calling or chat, if the app needs them

Many have free tiers that disappear as you grow. List every service in your technical plan, with its pricing page, before the build starts.

Fixes, updates and maintenance

Real users find bugs that testing missed, and Apple and Google release new operating system versions every year that can break older code. Plan for:

• A burst of fixes in the first weeks after launch.
• Updates to keep up with new iOS and Android versions and store policy changes.
• Small improvements based on what users actually do.

A common rule of thumb puts yearly maintenance at roughly 15% to 20% of the original build cost, before new features. On a $25,000 build, that is about $3,750 to $5,000 a year. Our guide to app maintenance costs explains what pushes it up or down.

Check what support is included after launch. Our MVP package includes 60 days of support; after that, ongoing work is quoted separately.

Marketing

An app nobody finds does not earn back its build. Budget for at least one of:

• App store optimization: a clear name, screenshots and description so people searching the store find you. See our guide to app store optimization.
• Paid installs through Apple Ads, Google App campaigns or social ads.
• Telling your existing customers, which is often the cheapest channel for a business app.

Who pays for what

Agree in writing, before the build starts, who holds each account and who pays each bill. The cleanest setup puts everything in your company's name: the developer accounts, the cloud hosting account, the code repository and every third-party service, with your developer added as a user. Then if you change developers, nothing has to be transferred under pressure, and you can see every recurring charge in one place.

Contingency

Hold back 10% to 20% of the build cost. Something will take longer than planned: a store review rejection, an integration partner whose documentation is wrong, or a feature users ask for in week two that you cannot ignore.

A sample first-year budget

For a focused business app built cross-platform:

• Discovery sprint: $2,500
• Build: $25,000
• Developer accounts: $124 ($99 Apple plus $25 Google)
• Hosting and backend: $1,200 (assuming about $100 a month)
• Third-party services: $600 (assuming about $50 a month)
• Fixes and updates after the support period: $3,750
• Marketing: $3,000
• Contingency at 10%: $2,500
• First-year total: about $38,674

Your numbers will differ, but the shape usually holds: the build is around two thirds of year one, and the rest is what keeps the app working and in front of users.

Your next step

Write down the one problem your app solves and the three features it cannot launch without. Bring that list to a discovery call. If you would like us to turn it into a prototype and a fixed quote, our mobile app development page explains how the sprint works, and the packages are on our pricing page.