What inputs does the Startup Cost Estimator need?

It takes 3 inputs: oneTimeCosts, recurringMonthlyCosts, contingencyPercent (default 15). Outputs returned: oneTimeTotal, annualRecurringTotal, contingencyAmount, firstYearTotal.

Can I verify the Startup Cost Estimator with a worked example?

Yes. With oneTime = $8,000, recurring = $1,200/mo ($14,400/yr), contingency = 15%. the tool returns one_time_total = $8,000, recurring_annual = $14,400, contingency ≈ $3,360, first_year ≈ $25,760.

Where does the Startup Cost Estimator get its benchmark data?

Reference data is sourced from: US Small Business Administration — Costs to Start a Business (as of 2024).

What can the Startup Cost Estimator not tell me?

Known limitations: Category definitions are editorial, not GAAP. Use the output as a budgeting aid, not an accounting document. No tax credit or grant modelling (e.g., R&D tax credit, SBIR). Adjust inputs downward by any credits you expect to claim.

Methodology: Startup Cost Estimator

1. Scope

Totals one-time pre-launch costs and recurring first-year costs across categories (legal, tooling, infrastructure, marketing, contingency). It does not replace a cash-flow model — pair it with the Monthly Burn Rate Calculator for operating state.

2. Inputs and outputs

Inputs

oneTimeCosts array

Each item: label, amount, category.
recurringMonthlyCosts array

Each item: label, monthlyAmount, category.
contingencyPercent percent default: 15

Outputs

oneTimeTotal

Sum of one-time costs.
annualRecurringTotal

Sum of recurring × 12.
contingencyAmount

contingencyPercent × (oneTime + annualRecurring).
firstYearTotal

oneTime + annualRecurring + contingency.

Engine source: src/lib/startup-cost-estimator/engine.ts

3. Formula / scoring logic

one_time_total    = sum(one_time)
recurring_annual  = sum(recurring_monthly) * 12
contingency       = (one_time_total + recurring_annual) * contingency_rate
first_year_total  = one_time_total + recurring_annual + contingency

4. Assumptions

First-year horizon. Beyond year one, re-run with updated recurring costs.
Contingency is a blanket buffer, not a risk-weighted reserve. A detailed risk register is out of scope.
Payroll is bundled into recurring costs by the user — no built-in salary logic.

5. Data sources

US Small Business Administration — Costs to Start a Business as of 2024

6. Known limitations

Category definitions are editorial, not GAAP. Use the output as a budgeting aid, not an accounting document.
No tax credit or grant modelling (e.g., R&D tax credit, SBIR). Adjust inputs downward by any credits you expect to claim.

7. Reproducibility

Input
oneTime = $8,000, recurring = $1,200/mo ($14,400/yr), contingency = 15%.

Expected output
one_time_total = $8,000, recurring_annual = $14,400, contingency ≈ $3,360, first_year ≈ $25,760.

8. Change log

2026-04-24 methodology page first published.

Worked example

Run live against the same engine this site ships (/engines/startup-cost-estimator.js). The inputs and outputs below are recomputed on every build and independently re-verified in CI — they are never hand-authored.

Input

tool: startup_cost_estimator
items[0].name: Legal
items[0].category: legal
items[0].amount: 2000
items[0].is_recurring: false

Output

totalOneTime: 2000
totalRecurringMonthly: 0
totalRecurringAnnual: 0
totalFirstYear: 2000
byCategory.legal.oneTime: 2000
byCategory.legal.recurring: 0
byCategory.legal.total: 2000
itemCount: 1

Frequently asked questions

What does the Startup Cost Estimator calculate?: Totals one-time pre-launch costs and recurring first-year costs across categories (legal, tooling, infrastructure, marketing, contingency). It does not replace a cash-flow model — pair it with the Monthly Burn Rate Calculator for operating state.
What inputs does the Startup Cost Estimator need?: It takes 3 inputs: oneTimeCosts, recurringMonthlyCosts, contingencyPercent (default 15). Outputs returned: oneTimeTotal, annualRecurringTotal, contingencyAmount, firstYearTotal.
What formula does the Startup Cost Estimator use?: The exact computation is: one_time_total = sum(one_time); recurring_annual = sum(recurring_monthly) * 12; contingency = (one_time_total + recurring_annual) * contingency_rate; first_year_total = one_time_total + recurring_annual + contingency
Can I verify the Startup Cost Estimator with a worked example?: Yes. With oneTime = $8,000, recurring = $1,200/mo ($14,400/yr), contingency = 15%. the tool returns one_time_total = $8,000, recurring_annual = $14,400, contingency ≈ $3,360, first_year ≈ $25,760.
Where does the Startup Cost Estimator get its benchmark data?: Reference data is sourced from: US Small Business Administration — Costs to Start a Business (as of 2024).
What can the Startup Cost Estimator not tell me?: Known limitations: Category definitions are editorial, not GAAP. Use the output as a budgeting aid, not an accounting document. No tax credit or grant modelling (e.g., R&D tax credit, SBIR). Adjust inputs downward by any credits you expect to claim.