The average monthly tech/IT overheads for startups are usually on the lower end, around $100 to $300 per user per month, but as the tech stack grows, the costs quickly increase.
The issue is that it’s a well-known fact that startups struggle with cash flow problems, with 38% of new businesses stating cash flow is the reason they failed (CB Insights).
Finding practical ways to reduce monthly tech expenses, especially as they increase, is one of the easiest ways to reduce the financial pressure. Here are 4 practical ways to do it.
Audit and Consolidate SaaS Subscriptions
If you do the research, this is the number one suggestion. Even though a startup doesn’t have as many SaaS subscriptions, they quickly accumulate and can cost as much as $3,500 per employee annually (Cloud Awards), and 42% of businesses have already reduced SaaS spend due to cost pressure (Hostinger), so it’s a good place to start for tech startups.
The issue for startups is more about the duplication of tools, like multiple CRMs that offer the same features but with different branding and dashboard interfaces slapped on top.
The easiest way to do it is to export your bank transactions to find the recurring transactions for SaaS subscriptions and look at which ones you need. To make it easier, you can tell ChatGPT which subscriptions you have and ask it to tell you where subscriptions overlap and which one you should cancel.
You can also ask ChatGPT to tell you how to replace the tools you’re using with all-in-one platforms to make it even cheaper. For example, Notion replaces docs, wikis, and task tools. Or you can consolidate domain management under cost-effective providers like Namecheap with a Namecheap promo code.
There are so many ways to bundle expenses and save.
Optimize Cloud Infrastructure (FinOps and Right-Sizing)
Approximately 27% of cloud spend is wasted, translating to over $180 billion in annual losses (ZopDev). Startups also spend an average of 8 to 15% of revenue on cloud infrastructure (SpendArk). It’s potentially a lot of money to waste, especially now that AI workloads (GPUs in particular) are driving cost spikes.
There’s a big issue with overprovisioned servers, but FinOps practices, used by 83% of organizations in 2025, work well to resolve the issue. FinOps practices are essentially an operational and cultural framework that fosters financial accountability, enabling teams to balance cloud speed, cost, and quality.
You can use cost tools such as the following:
- AWS Cost Explorer
- Azure Cost Management
- Google Cloud Platform Billing
- CloudZero
- Finout
- Kubecost (GitHub)
Replace Custom Builds with No-Code or Low-Code Tools
Software spending is exploding, predicted to reach $1.4 trillion globally by 2026, and IT spending is expected to reach $6.15 trillion in 2026 (Gartner).
AI-enabled software is massively driving costs and complexity and is quickly becoming one of the highest startup costs. Startups feel like they need to be building their own internal tools, especially in this Claude craze era we seem to be going through, designing everything from dashboards to CRMs to automations. It can work so well, but it can also be so expensive.
In our opinion, startups shouldn’t focus so much on custom builds and instead should go for solutions such as:
- Airtable or Baserow for internal databases
- Bubble or Webflow for MVP product builds
- Metabase or Looker Studio for a reporting dashboard
- HubSpot free tier or Pipedrive for CRM
You’re reducing everything from infrastructure costs to maintenance overheads by doing this.
Implement Automation to Reduce Manual and Operational Costs
Automation is something where you can spend money to save money.
Almost 90% of IT professionals say automation is key to managing SaaS (Vena Solutions), and 64% report automation significantly reduces manual work (Forbes).
Manual processes are probably one of the most hidden tech costs that startups don’t consider. And when errors and reworks are involved, it’s even more expensive.
Startups often scale headcount instead of systems, and you can do that by looking at your most repetitive processes, like customer onboarding or monthly invoices, and find an automated system to do it for you.
Some examples include:
- Zapier or Make for workflows across tools
- Stripe Billing for automated invoicing and subscriptions
- Intercom or Zendesk AI bots to reduce support staff load
- GitHub Actions to automate the CI/CD pipeline
With a smaller profit margin, your startup really needs to focus on cost savings where it can. Tech overheads will quickly become a massive monthly expense unless you can follow advice that helps you keep costs even.
