Startup costs vary enormously by industry — as a rough working range, a home-based service or solo e-commerce brand can open for roughly $2,000–$25,000, most storefront retail and personal-care businesses land around $50,000–$150,000, and capital-heavy operations like a full-service restaurant, a trucking authority, or a franchise build-out commonly run $150,000 to $500,000+. The number that matters isn't the headline figure, though — it's the split between one-time costs to open the doors and the working capital you burn before revenue catches up. This guide gives example ranges by industry, then shows the underwriting logic for which of those costs you should pay in cash and which you can responsibly fund out of future deposits once the business is actually taking money.
Key takeaways
- Startup costs split into two buckets: one-time build-out (equipment, leasehold, licensing) and working capital (the runway you burn before revenue catches up) — budget both.
- Example ranges span from ~$2,000-$25,000 for home-based/e-commerce to $175,000-$550,000+ for a full-service restaurant or $250,000+ for a medical practice.
- The highest-cost industries also have the longest revenue ramps (4-9 months), so they need the largest working-capital cushions.
- Plan to hold 3-6 months of fixed operating expenses on top of your one-time build-out; undercapitalization, not bad product, sinks most new businesses.
- Match funding to the cost: equipment financing for assets, SBA/bank loans for large build-outs, revenue-based financing for post-open cash-flow gaps.
- Revenue-based / MCA funding is underwritten on business bank deposits (FICO 500+, min ~$10,000, funds in 24-48 hours) and only fits a business that already has revenue — never a pre-revenue idea.
- Revenue-based funding needs only 3-6 months of bank statements versus the weeks-long document lift of SBA and bank loans; nothing is ever guaranteed.
The two buckets every industry shares: build-out vs. working capital
Before you look at a single industry number, separate every dollar into two buckets. Underwriters do this instinctively, and it's the single most useful lens for a founder.
- One-time build-out (CapEx): leasehold improvements, equipment, initial inventory, licensing, deposits, signage, branding, the POS or website. You pay these once to open.
- Working capital (OpEx runway): rent, payroll, utilities, insurance, marketing, and restock in the months before revenue reliably covers them. This is the bucket that quietly kills otherwise-viable businesses.
A restaurant with a stunning $220,000 build-out and $8,000 in the bank fails faster than a modest $90,000 build with a six-month cushion. The rule of thumb underwriters like: whatever your one-time cost is, plan to hold roughly three to six months of fixed operating expense on top of it. The industry tables below show the CapEx figure most articles quote — but the working-capital line is the one that determines whether you survive to month seven.
Startup cost ranges by industry (example figures)
The figures below are realistic example ranges for a US small business in 2026, not quotes. Your market, city, lease, and scope will move them. Ranges assume a lean-to-standard launch, not a flagship.
| Industry | Example one-time build-out | Typical heavy cost driver | Months to steady revenue |
|---|---|---|---|
| Home-based service / consulting | $2,000–$15,000 | Software, insurance, marketing | 1–3 |
| E-commerce / DTC brand | $5,000–$40,000 | Initial inventory, ad spend | 2–6 |
| Cleaning / landscaping | $8,000–$35,000 | Equipment, vehicle, crew | 1–3 |
| Food truck | $60,000–$175,000 | Truck build, permits, kitchen | 1–4 |
| Salon / barbershop / spa | $60,000–$200,000 | Build-out, chairs, licensing | 3–6 |
| Boutique / specialty retail | $60,000–$150,000 | Inventory, lease, fixtures | 3–6 |
| Coffee shop / cafe | $90,000–$300,000 | Espresso equipment, build-out | 3–6 |
| Full-service restaurant | $175,000–$550,000+ | Kitchen, hood, seating, liquor | 4–9 |
| Auto repair shop | $50,000–$250,000 | Lifts, diagnostics, bay lease | 3–6 |
| Trucking (single-truck authority) | $15,000–$40,000 (owner-op) | Truck (financed), insurance, ELD | 1–3 |
| Construction / trades contractor | $15,000–$75,000 | Tools, truck, bonding, licensing | 2–5 (net-30/60 lag) |
| Medical / dental practice | $250,000–$700,000+ | Equipment, build-out, staff | 4–9 (insurance A/R) |
Notice the pattern: the highest-CapEx industries also carry the longest lag to steady revenue. That combination — big spend up front, slow ramp — is exactly where working-capital planning matters most.
Where the money actually goes: a line-item worked example
Averages hide the story. Here's an illustrative line-item build for a modest quick-service food concept — the kind of detail that separates a real budget from a guess. Figures are for example only.
| Line item | Bucket | Example cost |
|---|---|---|
| Leasehold improvements / build-out | One-time | $45,000 |
| Kitchen equipment & hood | One-time | $38,000 |
| POS, signage, branding | One-time | $9,000 |
| Permits, licensing, deposits | One-time | $7,000 |
| Opening inventory | One-time | $6,000 |
| Rent + payroll, months 1–4 | Working capital | $52,000 |
| Insurance, utilities, marketing runway | Working capital | $11,000 |
| Total to reach steady revenue | ~$168,000 |
Roughly $105,000 of that is one-time and about $63,000 is runway. A founder who budgets only the one-time number — the figure most "startup cost" articles quote — walks in undercapitalized by a third. That gap is the number-one reason new businesses stall while doing everything else right.
How founders actually fund these costs
Different buckets suit different money. Matching the funding source to the cost is what keeps a launch solvent.
- Founder cash & savings: best for the riskiest, un-collateralized one-time costs (branding, deposits, soft costs). No repayment pressure while you're pre-revenue.
- Equipment financing: the truck, the lifts, the espresso machine, the kitchen line. The asset secures the loan, so rates are friendlier and it doesn't tie up cash.
- SBA / bank term loans: the cheapest capital for well-documented, collateral-backed build-outs — if you have the time (weeks to months), the credit, and the paperwork. Not a fit for a founder who needs to open in three weeks.
- Business credit cards / line of credit: flexible for smaller, revolving working-capital needs once you have some history.
- Revenue-based financing / MCA marketplace: a working-capital tool for a business already taking deposits. It's approved on your bank-deposit history and revenue rather than credit score, funds in roughly 24–48 hours, and repayment flexes with your daily or weekly sales. It is not a tool for a pre-revenue idea — there's no revenue to underwrite yet.
See our merchant cash advance overview for how deposit-based underwriting works and what it costs relative to bank options.
Decision framework: when to fund costs from future revenue
Revenue-based financing and MCA-style funding solve one specific problem: you have real, provable sales and a near-term cost that can't wait for a bank timeline. Here's the underwriter's read on fit.
Works best when:
- You're already open (or reopening) and have 3+ months of business bank deposits to show.
- Monthly revenue is at least ~$15,000+ and you need at least ~$10,000 in capital.
- The cost has a fast payback — restocking inventory before a busy season, covering a payroll gap, funding equipment repair, or bridging a net-30/60 receivable.
- Speed matters: you need funds in 24–48 hours, and a 6-week bank process would cost you the opportunity.
- Your credit is thin or bruised (FICO 500+) but your deposits are strong — deposit-based underwriting weights revenue over score.
Avoid when:
- You're pre-revenue — there's nothing to underwrite; fund a true startup with savings, equipment financing, SBA microloans, or investors instead.
- The cost is a long-horizon build-out (a full restaurant fit-out) better matched to a term loan or equipment financing.
- Your margins are thin enough that a daily/weekly remittance would choke cash flow rather than smooth it.
- You qualify for bank or SBA pricing and can wait for it — that capital is cheaper.
The honest framing: this is a cash-flow tool for going concerns, not a way to conjure startup capital from nothing. Nothing here is ever guaranteed — approval depends on your actual deposits and business profile.
Documents and timeline: what funding each bucket takes
Timeline is a cost too. If your equipment breaks in a launch week, a 30-day loan process isn't a solution. Here's what each path typically asks for and how fast it moves.
| Funding path | Typical documents | Typical speed |
|---|---|---|
| SBA / bank term loan | Business plan, tax returns, financials, collateral, personal guarantee | 3–8+ weeks |
| Equipment financing | Equipment quote, bank statements, credit check | 2–10 days |
| Revenue-based / MCA marketplace | 3–6 months of business bank statements; basic application; no tax returns for smaller amounts | 24–48 hours |
For revenue-based funding the document lift is deliberately light — the bank statements are the underwriting. A marketplace shops those statements to multiple funders at once, which improves your odds of an offer that fits your deposit pattern rather than taking the first one you find. That's the core of our working-capital and MCA guide.
Five moves to keep your launch from running out of cash
- Budget both buckets. Add 3–6 months of fixed operating cost to your one-time build number. Undercapitalization, not bad product, sinks most new businesses.
- Match the money to the cost. Finance long-life assets with equipment loans, keep revolving needs on a line, and reserve fast revenue-based capital for post-open cash-flow gaps.
- Open leaner than you want to. Every dollar cut from the flagship build-out is a dollar of runway. You can upgrade from revenue.
- Protect your deposit history. Run revenue through a dedicated business bank account from day one — clean, consistent deposits are the asset that unlocks fast working capital later.
- Line up funding before you're desperate. The cheapest capital goes to founders who plan; the most expensive goes to founders who wait until the register is empty.
Frequently asked questions
What is the average startup cost across all industries?
There's no meaningful single average because the range is so wide — a home-based service can open for a few thousand dollars while a restaurant or medical practice runs into the hundreds of thousands. A more useful benchmark: most storefront small businesses land somewhere between $50,000 and $150,000 to open, plus three to six months of operating runway on top. Always budget the runway separately from the build-out cost.
Which industries have the lowest startup costs?
Home-based services, consulting, freelancing, and lean solo e-commerce are the lowest — often $2,000 to $25,000 — because they skip the two biggest cost drivers: commercial leasehold build-out and heavy equipment. Cleaning, landscaping, and mobile trades sit just above that, since a vehicle and tools are the main expense.
Why do restaurants and medical practices cost so much more?
Two reasons: heavy specialized equipment and long revenue ramps. A commercial kitchen or a dental operatory carries large one-time equipment and build-out costs, and both take four to nine months to reach steady revenue — restaurants because of seasonality and reputation-building, practices because insurance receivables pay slowly. High CapEx plus a slow ramp means these industries need the largest working-capital cushions.
Can I use revenue-based financing or an MCA to start a business?
No — revenue-based and MCA-style funding are underwritten on your existing business bank deposits, so there has to be revenue to underwrite. They're working-capital tools for a business that's already open. To fund a genuine startup, use savings, equipment financing, an SBA microloan, or investors. Once you're taking deposits, revenue-based capital becomes a fast option for restocking, payroll gaps, or bridging receivables.
How fast can I get working capital once I'm open?
With revenue-based financing through a marketplace, funding typically lands in 24 to 48 hours because the underwriting is based on three to six months of business bank statements rather than tax returns and collateral. Bank and SBA loans are cheaper but usually take three to eight-plus weeks. Match the tool to your timeline — a slow process is the wrong answer to an urgent cost.
What credit score do I need for revenue-based funding?
Deposit-based funders generally work with FICO scores of 500 and up, because they weight your revenue and bank-deposit consistency more heavily than your credit score. Minimum funding amounts commonly start around $10,000. Approval and terms depend on your actual deposits and business profile — nothing is ever guaranteed.
How much working capital should I hold on top of my build-out cost?
Plan for three to six months of fixed operating expenses — rent, payroll, insurance, utilities, and marketing — in addition to your one-time build-out. Industries with slow revenue ramps (restaurants, retail, medical) should aim for the higher end. Undercapitalization is the most common cause of early failure, and it's almost always because the founder budgeted only the cost to open, not the cost to survive to steady revenue.
What documents do I need to fund startup costs?
It depends on the path. SBA and bank loans want a business plan, tax returns, financial statements, and collateral. Equipment financing needs an equipment quote and bank statements. Revenue-based funding needs the lightest package — typically three to six months of business bank statements and a short application, with no tax returns required for smaller amounts. The bank statements themselves are the underwriting.
