Question
How much should a small start up realistically set aside for UI design?
Answer
Since you are bootstrapped, I'll assume you plan to hit revenue on Day 1 and "profitability" in a lifestyle business sense at a very low acquisition bar like 2000 users. For a bootstrapped business, it is hard to define an objective profitability point, since owners are usually lifestyle business types who value "low touch" (or passive) income streams of a certain minimum magnitude.
For me, any low-touch income stream for a tech product under $500/month is uninteresting, given the overheads, so I'll use that as a benchmark. You can rework the scenario below for more ambitious plans and non-lifestyle type accounting. The basic principles are the same.
I'll lay out a sample scenario and a rationale for thinking this way. This logic will not work if the concept is extremely innovative at the UX level. It also assumes neither founder is a UI/UX person (in which case asking this question suggests he/she doesn't know his field).
Sample Scenario
As a sample scenario, let's assume a $10/month subscription product with a 9:1 freemium ratio that takes 6 months to build and launch V 1.0, 6 months to grow to 2000 roughly linearly, and plateaus at that point. This is quite optimistic, but not crazy optimistic.
That gets you to about $2000 revenue a month at steady state. Assuming a 2-person hacker-hustler startup team (http://learntoduck.com/micah/hac... ) who are each taking $500 out from that point on, and subtracting hosting and modest expenses, that leaves you with $900/month to fuel a natural bootstrapped growth rate post steady-state.
If you take out no money between $0 and $2000 a month, the linear rate for 6 months means you'll make 0.5*(2000-0)*6 = $3000, and you'll be investing all of it into the product. The 2 founders take nothing; it is all going to go to UX.
So your available budget is $3000 for the growth phase (which you will want to spend before you earn it) and $900/month steady state (which you will spend as you earn).
In this scenario (you can rework the numbers for your specific case), I would
a) Spend $0 before the first internal/alpha release (3 months). At this stage, the actual design work should be done by the founders (the hacker-hustler pair; the hacker will be able to do some amateurish and aesthetically poor UI design implementation, and the hustler will be able to do basic UX+UI design and even a placeholder logo in Inkscape.)
b) Between internal test and public release (month 3 - month 6), spend $1000 on a UI+graphic design person, cleaning up the basic templates, color palette, fonts, CSS and adding a decent logo. Don't spend money on UX at this stage. UX people are mainly cost-effective when feedback is starting to come in on a product that has proven to be "roughly right." There is no point spending money refining a product concept that has not been validated at the most basic level of whether there is a business opportunity. For $1000 you can get about 20 hours of a competent (not rockstar) graphic designer with some UI design skills.
b) Once you recover this money (assuming your amateur UX design is not so terrible that the product fails, in which case you've got bigger problems -- a founding team that doesn't have good "roughly right" product/business instincts and doesn't know how to do MVP hypotheses), spend another $2000 over the growth phase, either with an experienced person who can do it all, or a combo of a usability person (budget $1000) and another round of detailed design ($1000). Depending on the experience level of the UX person, between $80 - $150/hr, you can get 1-2 full working days. That is enough for that person to basically give you a rough but complete UX evaluation and design recommendations for a simple or medium-simple product. The product manager and graphic designer (20 hours) can take it from there.
c) When you have recovered that $2000, and are at steady state, shift to a percentage effort model. Your team effort will end up being split in some way between stabilization (paying off technical debt, mostly on the backend), evolution (refine current product) and revolution (build Version 2) efforts. You need a trickle of UI work on the 2nd category, and more serious UX work in the 3rd category, which should be designed almost clean-sheet by a usability person with very little micromanagement from the product manager, since user data is now flowing in, with less need for vision. Spend an appropriate fraction of your $900 available as fast as you are able, to move this thread of action forward. There will be other demands on the money, so some months you may have no money to buy UX hours, other months you may be able to use it all for UX.
Rationale
In the early days, at least one of the founders (usually the product manager+business person, i.e. the hustler of the hacker-hustler pair) should be rolling up their sleeves and doing the basic UI for at least the first internal release, and the lead dev should be implementing it as best they can. No UI person.
Even if it is terrible, this stage is important for giving the principals a deep hands-on sense of the design DNA of the product they are building.
The reason is that once you bring on a real UI person (cheap) you get one degree removed from the product. As product manager, you are now reacting to comps or describing what you want in words or much weaker sketches, delegating a lot of the thinking to the UI person. Once you believe enough in the product to invest in a UX person (expensive), the abstraction gets even more severe, since you'll be backing off even more, and discussing things with the UX+UI team in terms of use cases, tests you want to run and vague notions like "let's reduce the clutter on that page, that's been the main feedback from the users so far."
At that point, you've basically yielded the stage to specialists. You'll understand only about 30% of what's going on.
Warning
I feel like I should add a warning, because the question worries me.
The fact that you are asking this question should be a bit of a red flag to you in terms of the competencies on the startup team. You shouldn't have to ask this question. It is hustler's job to do this kind of basic back-of-the-envelope scenario planning based on resources available. There is no right answer to a question like this.
To "hustle" is to improvise and get things done with what you have. The structure of the question suggests that you have a rigid idea of what the roles/budgets etc. on a startup project "ought" to be (unless you are benchmarking).
You're going to have to do a LOT more free-form improv analysis like this if you want to have any chance at all of surviving. The hustler of the pair should be doing random analyses like this one on a spreadsheet constantly.
The numbers WILL turn into garbage as the action progresses. The point is the planning, not the plan. As Eisenhower said, "plans are nothing, planning is everything." Marc Andreessen said roughly the same thing in an interview, "the process of planning is very valuable, but the actual plan that comes out is probably not worth much."
http://trailmeme.com/walk/The_Ul...
For me, any low-touch income stream for a tech product under $500/month is uninteresting, given the overheads, so I'll use that as a benchmark. You can rework the scenario below for more ambitious plans and non-lifestyle type accounting. The basic principles are the same.
I'll lay out a sample scenario and a rationale for thinking this way. This logic will not work if the concept is extremely innovative at the UX level. It also assumes neither founder is a UI/UX person (in which case asking this question suggests he/she doesn't know his field).
Sample Scenario
As a sample scenario, let's assume a $10/month subscription product with a 9:1 freemium ratio that takes 6 months to build and launch V 1.0, 6 months to grow to 2000 roughly linearly, and plateaus at that point. This is quite optimistic, but not crazy optimistic.
That gets you to about $2000 revenue a month at steady state. Assuming a 2-person hacker-hustler startup team (http://learntoduck.com/micah/hac... ) who are each taking $500 out from that point on, and subtracting hosting and modest expenses, that leaves you with $900/month to fuel a natural bootstrapped growth rate post steady-state.
If you take out no money between $0 and $2000 a month, the linear rate for 6 months means you'll make 0.5*(2000-0)*6 = $3000, and you'll be investing all of it into the product. The 2 founders take nothing; it is all going to go to UX.
So your available budget is $3000 for the growth phase (which you will want to spend before you earn it) and $900/month steady state (which you will spend as you earn).
In this scenario (you can rework the numbers for your specific case), I would
a) Spend $0 before the first internal/alpha release (3 months). At this stage, the actual design work should be done by the founders (the hacker-hustler pair; the hacker will be able to do some amateurish and aesthetically poor UI design implementation, and the hustler will be able to do basic UX+UI design and even a placeholder logo in Inkscape.)
b) Between internal test and public release (month 3 - month 6), spend $1000 on a UI+graphic design person, cleaning up the basic templates, color palette, fonts, CSS and adding a decent logo. Don't spend money on UX at this stage. UX people are mainly cost-effective when feedback is starting to come in on a product that has proven to be "roughly right." There is no point spending money refining a product concept that has not been validated at the most basic level of whether there is a business opportunity. For $1000 you can get about 20 hours of a competent (not rockstar) graphic designer with some UI design skills.
b) Once you recover this money (assuming your amateur UX design is not so terrible that the product fails, in which case you've got bigger problems -- a founding team that doesn't have good "roughly right" product/business instincts and doesn't know how to do MVP hypotheses), spend another $2000 over the growth phase, either with an experienced person who can do it all, or a combo of a usability person (budget $1000) and another round of detailed design ($1000). Depending on the experience level of the UX person, between $80 - $150/hr, you can get 1-2 full working days. That is enough for that person to basically give you a rough but complete UX evaluation and design recommendations for a simple or medium-simple product. The product manager and graphic designer (20 hours) can take it from there.
c) When you have recovered that $2000, and are at steady state, shift to a percentage effort model. Your team effort will end up being split in some way between stabilization (paying off technical debt, mostly on the backend), evolution (refine current product) and revolution (build Version 2) efforts. You need a trickle of UI work on the 2nd category, and more serious UX work in the 3rd category, which should be designed almost clean-sheet by a usability person with very little micromanagement from the product manager, since user data is now flowing in, with less need for vision. Spend an appropriate fraction of your $900 available as fast as you are able, to move this thread of action forward. There will be other demands on the money, so some months you may have no money to buy UX hours, other months you may be able to use it all for UX.
Rationale
In the early days, at least one of the founders (usually the product manager+business person, i.e. the hustler of the hacker-hustler pair) should be rolling up their sleeves and doing the basic UI for at least the first internal release, and the lead dev should be implementing it as best they can. No UI person.
Even if it is terrible, this stage is important for giving the principals a deep hands-on sense of the design DNA of the product they are building.
The reason is that once you bring on a real UI person (cheap) you get one degree removed from the product. As product manager, you are now reacting to comps or describing what you want in words or much weaker sketches, delegating a lot of the thinking to the UI person. Once you believe enough in the product to invest in a UX person (expensive), the abstraction gets even more severe, since you'll be backing off even more, and discussing things with the UX+UI team in terms of use cases, tests you want to run and vague notions like "let's reduce the clutter on that page, that's been the main feedback from the users so far."
At that point, you've basically yielded the stage to specialists. You'll understand only about 30% of what's going on.
Warning
I feel like I should add a warning, because the question worries me.
The fact that you are asking this question should be a bit of a red flag to you in terms of the competencies on the startup team. You shouldn't have to ask this question. It is hustler's job to do this kind of basic back-of-the-envelope scenario planning based on resources available. There is no right answer to a question like this.
To "hustle" is to improvise and get things done with what you have. The structure of the question suggests that you have a rigid idea of what the roles/budgets etc. on a startup project "ought" to be (unless you are benchmarking).
You're going to have to do a LOT more free-form improv analysis like this if you want to have any chance at all of surviving. The hustler of the pair should be doing random analyses like this one on a spreadsheet constantly.
The numbers WILL turn into garbage as the action progresses. The point is the planning, not the plan. As Eisenhower said, "plans are nothing, planning is everything." Marc Andreessen said roughly the same thing in an interview, "the process of planning is very valuable, but the actual plan that comes out is probably not worth much."
http://trailmeme.com/walk/The_Ul...