We're not in London, and we pay more than that. We keep costs down by dint of the fact that our costs are, in descending order:
- People
- Hardware
- Offices
We even manage to have fun, too.
I just can't wrap my head around where this "other" expense that folks are supposed to have goes.
Sure, you can throw more fuel on and grow faster, maybe, but to burn for the sake of burning, because you have to hit a number... I just do not understand. Bullshit metrics destroy so much. You just have to look at where the NHS has ended up, to understand how this rot pervades (GPs must see N patients per day. Surgeons must "solve" N cases per month. Death rates must be below X.).
Your numbers must be off - 80k/month for 30 people means paying <32k; that's an average and assuming hardware and offices are both zero. Good devs cost more than that in Cambridge (and at least twice that in London), and elsewhere you'd struggle to find them at all. Are you relying on hiring fresh grads or something?
Some of our folks earn >50k, others <25k (boils down to skill and experience), and we do hire grads, but also very experienced folks.
Oh - and I am off, but not hugely - has crept up to about £95k with our current headcount of 30, but it's still a gulf apart from the numbers in the article.
I don't think it's fair to make a comparison across geography. There are too many variables, such as cost of living and the employment market that may affect overhead. You can definitely make a case for whether or not starting a company in the Valley is a good idea given high costs, but that's a different argument that's also been done quite a few times over.
For example, it would be similar to me claiming your burn rate of £95k is extremely high because I'm based in India and pay my developers £7 per hour.
I think people are just confused by your use of the word "burn". What is your fully loaded average cost per employee (total spend divided by headcount of 30 people)?
About £2.8k - £3.2k/month - it has admittedly increased over the last six months, as we've had a few expensive hires, and have taken on more space in preparation for more growth.
As per elsewhere, we admittedly have abnormally low rent costs, and virtually no other costs outside of rent, people, power, and hardware.
Welcome to the real world. Most small software businesses who offer some small service (say, an ERP software package no one has ever heard of + support) to a small number of companies hire the cheapest devs they can find.
