Costs and margins
Cost is not a pricing input for this product. The platform costs about £161 a month fixed and 3–14p per worker per month variable, against prices of £1.30–£3.19 per worker. The one cost decision that matters is how often you send an SMS code.
- Fixed platform cost: £160.65 a month (£1,928 a year) with a proper database and monitoring, up to about 3,000 workersS5, S6, S23. About £255 a month above that.
- A UK phone verification costs 7.8pS1, S2. Verified monthly, that is 58–82% of all cost of goods. Verified only on a new device, it is 1.3p per worker per month.
- Everything else is rounding: translating a 300-word post into six languages costs 0.5pS4; Mux captions are free and 100,000 delivery minutes a month are freeS3.
- Gross margin 94–99% at list prices with the recommended login policy; 89–97% even if you verify every month.
- Break-even on the fixed cost is about 75 paid workers: one Site customer.
The one product decision that decides the cost line
| Login policy | Verifications / worker / year | £ / worker / month | COGS at 1,000 workers | Verdict |
|---|---|---|---|---|
| A. Verify every login, monthly (as the app does today with 30-day sessions) | 12 | £0.078 | £133 / month | Do not ship |
| B. Device-bound session, re-verify every 90 days | 4 | £0.026 | £82 / month | Acceptable |
| C. Device-bound session; re-verify only on a new device, cleared storage, or a 180-day gap | ≈2 | £0.013 | £68 / month | Recommended |
| D. As C, own one-time codes over plain SMS (drop Twilio Verify) | ≈2 | £0.007 | £62 / month | Saves 47% of message cost; you lose Verify's SMS-pumping fraud protection. Revisit above ~50,000 verifications a year. |
Do this in the product before the first paying customer: long-lived device-bound sessions with re-verification only on a new device. It is simultaneously the cheapest option and the best experience: a site operative should never be asked for a code to read a safety briefing.
If a customer insists on SMS delivery of posts (some will, on sites with no wifi), that is 4.1p per message per worker: eight posts a month to 500 workers is £165 of pass-through against a £950 subscription, 17% of revenue gone. Price it at 8p a message or exclude it on the order form. Push is free, which is why "does it work without an app?" is the demo's most important 30 seconds.
Fixed platform cost, per month
| Line | Up to ~3,000 workers | ~3,000–15,000 workers | Source |
|---|---|---|---|
| Laravel Forge (Growth) | £13.99 | £13.99 | S6 |
| EC2 t4g.large, web/app, London | £40.42 | £80.84 (×2) | S5 |
| EC2 t4g.medium, queue + Reverb + Redis | £20.21 | £20.21 | S5 |
| EBS gp3 disks | £6.85 (est) | £10.31 (est) | S5 |
| RDS MySQL db.t4g.medium | £38.70 (single-AZ) | £77.93 (multi-AZ) | S23 |
| RDS storage + backups | £8.83 (est) | £8.83 (est) | S23 |
| S3 + CloudFront | £3.68 | £14.72 | S5 |
| Error monitoring | £14.72 | £14.72 | S23 |
| Uptime monitoring | £11.04 | £11.04 | S23 |
| Email (SES), domain, DNS | £2.21 | £2.21 | S23 |
| Total fixed | £160.65 | £254.80 | USD lines at 0.78 (S7) |
Today TeamTalk runs MySQL on the same box as the app, which is about £45 a month cheaper than RDS. The table prices the setup you should be on before a plc customer asks about backups and point-in-time recovery, because they will.
Variable cost per worker per month
AssumptionsS20: 8 posts a month, 3 languages per site, 20% of posts with a 2-minute video, push for everything, verification policy C (about two verifications per worker per year).
| Driver | Unit price | Pence / worker / month | Source |
|---|---|---|---|
| Phone verification (policy C) | $0.05 + one UK SMS segment ≈ 7.8p per verification, ≈ 2 a year | 1.3 | S1, S2 |
| Translation | $0.20 / $1.20 per 1M tokens in / out; 0.5p per post into six languages, shared by the site | 0.02 | S4 |
| Video encoding | $0.025 per minute, once per video | 0.1 | S3 |
| Video storage | $0.0024 per minute per month | 0.1 | S3 |
| Video delivery and captions | Free to 100,000 minutes a month; captions free | 0 | S3 |
| Push notifications, realtime | Free (web push; self-hosted Reverb) | 0 | — |
| Photo storage and egress | S3 + CloudFront free tiers cover it | 0.1 | S5 |
| Total variable, policy C | ≈ 1.5p | ||
| Total variable if you keep verifying monthly (policy A) | ≈ 8p | ||
| Add SMS delivery of 8 posts a month | + 33p | S2 | |
Cost per worker by platform size
Gross margin at list prices
| Workers on platform | COGS / worker (policy C) | at £1.30 (top band, full) | at £1.80 (Site, full) | at £2.20 (≤250 band, full) | at £3.19 (501 band floor) |
|---|---|---|---|---|---|
| 250 | £0.069 | 94.7% | 96.2% | 96.9% | 97.8% |
| 1,000 | £0.069 | 94.7% | 96.2% | 96.9% | 97.9% |
| 5,000 | £0.032 | 97.6% | 98.2% | 98.6% | 99.0% |
Calculator
Unit prices in the calculator: verification 7.8p (S1, S2), SMS 4.1p (S2), Mux encoding and storage (S3), translation and storage as above, USD at 0.78 (S7).
What it costs to run the business for a year (not the product)
| Line | £, 12 months | Note |
|---|---|---|
| Infrastructure (fixed platform) | 1,930 | £160.65 × 12 |
| Twilio verification + fallback SMS | 400 | Depends entirely on the login policy above |
| OpenAI, Mux, S3/CloudFront | 150 | Negligible at this scale |
| Monitoring, uptime, email, domains | 600 | |
| Cyber Essentials + ICO fee + Companies House | 490 | CE £320 + VAT; ICO £52; confirmation statement £50S8, S9 |
| Insurance (PI, PL, cyber) | 1,200 | Estimate; three broker quotesS10 |
| Legal: contract + DPA review | 1,500 | Once, before customer oneS11 |
| Accountant | 1,500 | |
| Sales tooling (LinkedIn Sales Navigator, HubSpot free, email) | 1,300 | Sales Navigator is the big line |
| Travel to sites and offices | 2,500 | This sector does not buy over Zoom alone |
| Two demo handsets and contracts | 700 | The demo needs a real phone |
| Collateral and case-study design | 800 | |
| Pen test (month 8), Cyber Essentials Plus | 5,500 | Estimates; defer both until a named deal is gated on them in writing |
| Non-salary total | 18,570 (13,070 with the last line deferred) | |
| Founder living costs | 30,000–45,000 | The real number |
| Cash needed for 12 months | ≈ 49,000–64,000 | Covered by base-case revenue: about £34k. Plan for £50k–£65k of runwayS25. |
The business is not capital-intensive: infrastructure is under £200 a month and gross margin is above 94%. The entire cash requirement is your time and the length of UK construction procurement. Do not spend on ISO 27001 or Cyber Essentials Plus until a specific deal is gated on it in writing.