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It's more expensive now to start a company, not cheaper

3 points by epicureanideal ↗ HN
Although the cost of computing hardware is lower, the cost of living is so much higher that I don't think it has become cheaper to start a company.

Unless of course you still live with your parents, or are somehow saving on rent expense by living 4 people to an apartment.

Especially for people with families, the cost of living I think more than outweighs the reduction in cost of computer hardware and software.

Do you agree or disagree?

5 comments

[ 8.4 ms ] story [ 34.9 ms ] thread
PaulHoule
Don’t you earn inflated dollars to make up for the inflated expenses?
epicureanideal
I think the statistics show that housing costs have increased much faster than inflation, and I think it is housing cost now that's the most expensive factor in person with a family trying to start a startup. If you can sleep on someone's couch then it's less of an issue.
muzani
A lot of the biggest companies in the world were started in garages. So you need either VC funds or a garage to start a company. If you're in an apartment, you're probably living in a city where the cost of living is too high.
mattbgates
It really depends on the state you start in... where I live, it costs $50 to start an LLC. That price hasn't changed in over 10 years.

As far as cost of living.. rents and food have gone up. Going out to a restaurant has changed. Renting a bigger apartment or even a house has gone up. But if you're a smart shopper, saver, and spender, you can save money in the long run.

For example:

1. Drive throughout your entire town and take note of the cheapest gas prices. You'd be better off paying $65 for a Costco/Sam's Club card and going there for gas, saving you an average of at least $0.50 or more per gallon of gas.

2. Renting. You'll want to rent with year leases because that'll give you the most savings as leases lock you into fixed prices.

3. Food. Again, a Costco or Sam's Club card and buying in bulk is likely to save you more money in the long run. Going to the supermarket several times a month and noting the sales is going to also save you money. If you see that eggs are $4 or $8, this is not the time to buy them. Find another place. I've gone to off brand supermarkets and paid $2 for a dozen eggs. Look for sales and discounts. If you are a meat eater, note the expiration dates and try to head to the supermarket a few days before you know those are going to expire.

In fact, visit the supermarket daily without any intention to spend. Go in and look for meat on sale. I've gotten packages of ribs, pork, and steak for less than $5. Also, in the long run, it's a good investment to buy a 5-gallon jug and get one of those water coolers. Walmart and other stores charge about $1.50 to refill those. With a family of 3 or 4, who you should be teaching to drink water more often, that should last about a week.

Software costs... lots of free software nowadays. Find it. And as for hardware costs...yeah, that's certainly gone up a bit, though if you're talking about computer hardware renting costs, those haven't changed at all except there is better technology offered. For example, Vultr, DigitalOcean, and Linode still offer a $5/month server. I am still on Vultr's $6 server which is their high CPU server and good enough for my websites. If you use another program like RunCloud, you can put a dozen or two web applications on those without issues and the pricing ain't bad.. comes to about $80 on the year plan for unlimited web apps.

There are a lot of ways to beat the cost of living and inflation to an extent though it all depends on what your spouse and family is also willing to accept. As a single person, it's a lot easier to go without.

throwawayadvsec
You don't have to live in San Francisco to start a company?

A company can be started from a 200$ shack in Asia.

Your apartment rent is not part of the cost of starting a company.