In 2017, mobile apps brought in more than $60 billion in global revenue – $40 billion from the App Store and $20 billion from Google Play. That $60 billion is spread across roughly 92 billion global downloads; 28 billion on iOS and 64 billion on Android. That’s a pretty big pie – and many people want a piece.
To get a piece of that pie, you need to create a mobile app that attracts users and supports a sustainable, monetizable business. Developing a great mobile app can be the gateway to building a growing, thriving business – but how much does it cost to make a mobile app? What’s the cost of app development? And what does it cost to continue to maintain, expand, and grow that mobile app?
At Rootstrap, we’ve overseen the launch of more than 250 digital products – so we’ve been around the app development block before. We’ve built big and small mobile apps for everyone from startups to enterprise corporations, so we have an intrinsic understanding of the costs of app development.
So, how much does it cost to make an app? It all depends on what you want to build.
App Development Costs
The problem with asking the question “how much does an app cost” is that, truthfully, no two apps are created equal. Mobile apps vary drastically in function, feature set, platform, and back-end technology, and every variation changes the cost of development.
Asking how much it costs to build a mobile app is like asking how much it costs to build a car. Do you want a Hyundai or a Lamborghini? You can build a quick and dirty mobile app on the cheap, but that limits the functionalities you can build into your app. Conversely, you can build an extensive, feature-rich mobile app – but that drives up the price tag.
On a basic, ballpark level, you should expect to spend anywhere from $50,000 to $250,000 on an “average” mobile app. While it’s possible to build an app with as little as $10,000, most apps – even simple ones with basic functionality and little extra tech – will cost at least $50,000 to $80,000. On the high end, apps with a large feature set or that include a lot of back-end technology can easily run anywhere from $250,000 to more than $1,000,000.
So what determines how much your app costs? One of the primary elements is the size and the nature of the feature set.
The cheapest apps are simple, single-function programs. They do one thing and one thing only, and they generally have no bells and whistles added on top. Think simple calculator apps, unit conversion apps, or very simple games. These mobile apps, if simple enough, could cost as little as $10,000 – but again, they do very little.
Adding more features means adding more cost. With a mobile game, for example, adding the ability to log in, to save your scores, or to share your scores via social media all can drastically increase development costs.
This brings us to another major determinant of app development costs: technology. Part of what makes simple, single-function apps inexpensive is that they don’t require any kind of extra tech on the backend or server side. A calculator app doesn’t require any server support – the app is essentially self-contained in the code of the program.
However, any kind of communication between users, login system, or external data storage requires a system of servers to support the app. This is a much more expensive proposition. Functions that require API integration, like social logins or social media sharing, further drive up costs.
For example, take a seemingly-simple app like Toggl. Toggl is a great little time-tracking app (check out The Freelance Effect’s review), and part of what makes it so powerful is its simplicity. It just records time entries for different categories and adds them up, with a few bells and whistles. Should be a straight-forward, low-budget app, right?
Except here’s the thing: Toggl syncs all data across devices, which means there’s a server-side element to the app. This means that even though the app is relatively simple, it’s a much more costly build. Any server systems will drastically drive up the cost of the app.
Adding in features like this, which require server support for the app, quickly inflate the cost of developing an app. While you may pay only $50,000 for the v1.0 of a self-contained app, adding in server functionality will easily multiply that cost into the $150-250,000 range.
Beyond functionality, server support, and integrations, the platforms you develop your app for matter, as well. Building an app only for iPhone is going to be cheaper than building an app for both Android and iOS on mobile and tablet devices. Generally, you’ll want your app to be accessible from any platform or mobile device – but this increases the cost of development.
Another important factor is who’s actually building the thing. Because full disclosure: in 2018, you can find an app developer at just about any price point you want to name.
The truth is, there are scores of developers, even whole app development companies, on sites like Upwork and Elance that are willing to build you a massive mobile app for less than $10 an hour. At that rate, you could be looking at significantly less than $5,000 in development costs.
Sounds too good to be true, right?
Well, we hate to break it to you, but it is. Paying $10/hour for a professional app developer is asking for trouble. There’s just no way to trust the quality of the software. You might be saving money initially, but you’ll be condemning yourself to deal with bugs, crashes, and dissatisfied users for the rest of the life of your business. Trust us – we know, because we’ve seen it before. And once you’ve put yourself in that position, it’s very hard to get out of it again.
When we say that not all apps are created equal, we’re talking about more than just the app idea. No matter what anyone tells you, code quality matters. You are building a business off of this application, and you need it to perform reliably and grow with you as that business scales. If you aren’t working with a reputable app development company, there’s no way to be sure that your mobile app will offer the stability you need from it.
Finally, it’s important to recognize that building an app isn’t just a one-time cost – and the cost of app development alone won’t cut it if you ever want to see a return on your investment. In addition to building your app, you’ll need to maintain it.
How Much Does It Cost to Maintain an App?
App development isn’t purely a one-time cost. Building the v1.0 of your mobile app accounts for a significant share your investment, but you’ll also need to think about long-term maintenance costs. Remember: you’re not just building an app here, you’re building a business.
So what does it cost to maintain an app?
The rule of thumb with software maintenance is that annual maintenance costs are around 20% of the initial development investment. If you spent $100,000 building the initial release of your app, you should expect maintenance costs to be around $20,000 annually thereafter.
These maintenance costs go towards bug fixes, app updates, new features, and general upkeep to make sure your app is compatible with all devices and software updates. Without this kind of maintenance, it’s easy for bugs to creep in, for users to get bored, and for the app engagement rate to plummet.
As always, the 20% figure is a ballpark number: depending on the specifics of the product your building, the actual number may be lower or higher. A simple, single-function app will probably require less maintenance, as you’ll only need to fix bugs and ensure compatibility with updates to mobile operating systems. A more robust app with servers will require more maintenance to keep all the moving parts running smoothly.
Beyond pure technical maintenance, however, there are plenty of costs many people fail to consider.
Building the app itself is only one piece of the cost of launching a mobile app. We always tell clients to remember that they aren’t just building an app: they’re starting a business. To see positive ROI on a mobile app, it’s vital to attract an engaged user base and build a brand around the app. That takes time and money.
At Rootstrap, we offer growth marketing and user acquisition focused on achieving the highest-possible ROI – that is, we’re growth hackers at heart. Our goal is to stay scrappy and see what pulls in the most dedicated users with as little time and energy as possible. But still, growth takes resources. Some apps will go viral of their own accord, but generally even the most “organically viral” apps have a well-funded media campaign behind them.
In addition to growth user acquisition, there are operational and overhead costs to think about. Keeping a team – even a small one – onboard means payroll. There are legal fees to think about. We’re all for running lean, but that doesn’t mean there will be no miscellaneous costs for launching your app.
What’s important is to understand all of this from the beginning. For most startups, it’s reasonable to give yourself about 18 months of runway to hone the product and achieve traction. Realistically, that means at least $120,000 of operational money, around $150,000 for developing the v1.0, and then salaries for you and your team – for reference, most founders in YCombinator pay themselves about $50,000 a year. Add a cofounder and extend that to the 18-month runway and you’re looking at $150,000 for salaries.
So, our total for 18 months?
$120,000 operations + $150,000 development + $150,000 in salaries = $420,000
And again – this will change depending on the specifics of your product and your business. But chances are, this number is a minimum. In fact, we like to tell clients to take whatever number they think they’ll need and multiply it by 1.5. This puts our number at $630,000. The only certainty is that unexpected things will pop up. You don’t want to let them bankrupt you.
If $630,000 sounds like a lot of cash, well, it is – but thankfully, it’s not something you have to cough up immediately. In fact, that’s part of the reason we started offering Roadmapping.
Roadmapping is comparatively cheap and low-risk, giving you the chance to test your product without devoting hundreds of thousands of dollars and years of your life to it. Plus, if we do think the product is good, we’ll give you the tools to raise capital – and as a Roadmapping alum, you’ll be about 2,600% more likely to secure that capital than the average startup. In fact, Roadmapping alumni have raised more than $500 million in aggregate capital to date. Pretty good numbers, if you ask us.
App Development Cost Calculator
So, now we’ve explored the ballpark cost of app development, the factors that affect the total cost of development, and the costs outside of development you’ll need to consider when launching an app.
But how much does your own app idea cost?
The only way to faithfully answer this question is through a Roadmapping session. But, for the sake of exploration, take a look at this calculator to get a very broad-strokes estimate of the cost of your mobile app idea.
|How Feature-Rich?||Technology?||Non-Dev Costs||Who’s Making It?|
|Offshore, low budget freelancers
|Standard social/API Integrations
|Mid-Sized App Development Company
|Extensive server support
|Large, prestigious agency
To use this table, choose one box from each of the first three columns, then add up the costs. This will give you a ballpark cost for an “average” app developer. Then, choose a box from the “who’s making it” column and multiply the total by that number. But before you opt for a low-budget, offshore freelancer, just remember – you’ll likely eat that savings dealing with bugs down the road.
As an example, let’s say we’re going to build a simple, single-function app like a calculator. If we run an ultra-lean operation and pick a reputable development company, our costs will look like this:
Single-function ($50K) + Standalone ($0) + Low-Budget ($60K) = $110,000 * Mid-Size (1) = $110,000
Alternatively, let’s say we’re building a massive enterprise app with a large development agency:
Extensive ($300K) + Server Support ($25K) + Robust Operations ($200K) = $525K * Prestigious (2) = $1,050,000
Look at that. Tweak a few variables, and suddenly the costs go up 10-fold – and it’s not impossible for costs to rise significantly higher. Building an app like Uber, which requires a massive array of server-side support, can easily run up to $1,500,000 for development alone.
But again, this is the nature of app development. You get what you pay for. Do you want a Hyundai or a Lamborghini?
Average Cost to Develop an App
Ok, now you have a handle on what goes into the cost of app development. But what does it look like on the ground? How much does the “average” app cost to build?
Let’s see what the data say.
Clutch, a company that aggregates and rates app developers, estimates that the average cost to develop an app ranges from $38,000 to $171,000. However, they caution that the number can reach an excess of $500,000.
A survey by Kinvey finds that the average cost of app development is about $270,000, with 19% of CIOs reporting a spend between $200,000 and $500,000 for app development. Further broken down, the Kinvey report finds spending split across the following categories:
- 14% spent less than $50,000
- 21% spent $50,000 to $100,000
- 17% spent $100,000 to $200,000
- 19% spent $200,000 to $500,000
- 18% spent $500,000 to $1,000,000+
- 11% weren’t sure
A survey of enterprise mobile development by Unified Communications Insights corroborates this number, finding that close to 30% of respondents spent $250,000 to $500,000 developing an app. Here’s how the UCI report broke down enterprise mobile development spending:
- 24.7% spent less than $250,000
- 29.1% spent $250,000 to $500,000
- 7% spent $500,000 to $1,000,000
- 5.7% spent $1 million to $1.5 million
- 25.3% spent more than $1.5 million
Keep in mind that the numbers from the UCI report are for enterprise mobile apps, so we should expect them to be inflated compared to the average mobile app.
That said, these studies point to a pretty clear “average” for mobile app development costs. According to this data, the average mobile app costs about $100,000 to $500,000 to build, with most falling in the $100K to $300K range. And remember – that’s in addition to maintenance and operational costs.
How Much Does it Cost to Make an App by Yourself
All that said, these numbers all represent the cost of working with an app development company. But what if you want to go it on your own?
On the surface, you might expect that developing an app by yourself is cheaper. And, strictly speaking, it is – you can afford to pay yourself much less than an app development agency will charge. Similarly, if you find a technical cofounder to build the app, you can offer them equity for their services instead of just cash payments.
This brings down the price tag for building an app significantly, but it’s not without trade offs.
If you have the technical chops to code your app and do it on your own, you’re technically not “paying” for app development – but you also have to consider opportunity cost. While developing an app by yourself can make a lot of sense if you’re cash is tight, you’re talking about hundreds of hours sitting in front of a computer coding.
That’s time you could be using to secure investors, test the product with customers, or even making money to pay an app development company. It’s not necessarily a bad idea, but it’s important to realize that there are costs hidden under the savings.
If you find a technical cofounder willing to build your app, this can also bring down upfront costs – but again, there are tradeoffs. You may not be paying this cofounder with cash, but you will be paying them with something potentially far more valuable: equity.
For example, let’s say your app would cost $150,000 to develop with an app development agency. Instead, you get a technical cofounder to build it for a 50% equity stake.
That saves you $150,000, which is pretty sweet. But what happens if your company really takes off?
If your app grows so much that your company gets valued at $1,000,000, you’ve effectively paid your technical cofounder $500,000 for $150,000 of work. Again, there’s nothing wrong with this – if that was the only option for getting the thing finished, it’s a smart move. But if you could have raised the cash to pay an agency for the app, you’d be sitting on an extra $350,000 from your increased equity stake.
What if your company grows to be worth $2,000,000? That means you’ve sacrificed $750,000 in equity to save $150,000 on dev costs, at a net loss of $600,000. If you’re valued at $5,000,000? That means you’ve effectively said goodbye to an extra $2,350,000 to save money on dev costs at the beginning.
And hey – when you’re first launching a company, these kinds of decisions often make sense. But what’s important is to realize you’re making them and not give away 50% of your equity to the first coder that comes along.
iPhone App Development Cost
Now, let’s explore one last concept for the cost of app development: platform. iOS and Android are the two dominant smartphone platforms for app development today, and each one has its own benefits and drawbacks. But how does the cost of app development change on iPhone and Android?
Most developers will tell you that Android takes longer than iOS – generally by about 30%. In terms of pure human-hours, this means that Android apps are generally more expensive to develop than iPhone apps.
It’s worth noting here that on average, iOS apps are more profitable than Android apps. In 2017, the App Store generated $40 billion in revenue from 28 billion downloads, compared to $20 billion in revenue from 64 billion downloads on Google Play. Effectively, that means iOS apps made twice as much revenue with less than half the number of downloads. This makes iPhone apps sound pretty attractive.
But the picture is a little more complicated than that.
What’s critical to consider here is that Android is a significantly more flexible platform than iOS. The App Store requires a review period for publishing new apps and updates, which can last anywhere from a few days to two weeks. This means that updating the an app based on user feedback is a slower process for iPhone apps.
But here’s the kicker – user acquisition costs are much lower on Android. This means that with the same amount of money, you can build a bigger user base on Android than you can on iOS. And, thanks to the flexibility of the Android platform, you can use that user base for testing and iterating your product early on.
Android app development can be more expensive than iPhone app development, but it depends on the project. And the fact that Android is so much more flexible means that we’ve seen many companies succeed by developing Android first, iterating the product to gain traction, then moving to iOS after honing the product.
Start Building an App Today
In closing, we’ll say again what we said at first: there is no “average” mobile app. Each one is different, and the cost of mobile app development will vary drastically based on the specifics of your app idea.
But at Rootstrap, we have a unique process and approach to understanding those costs and validating the app before investing in development.
It’s called Roadmapping. It takes 2-4 weeks, costs a fraction of the price of development, and puts you in a position to raise capital when you do head into development.
If you’re interested, we’re currently accepting new applicants to the workshop. And even if all you have is an idea, we’d love to talk.
This could be the first step to building your mobile app – and launching a growing, thriving business behind it.