Thinking about starting a software company — what are the realistic first-year costs and how does the process work?

Finalize your draft contracts with the clients you'll be billing before handing in your notice. 250,000 TL in starting capital might seem plenty on paper, but corporate accounts pay on 60 to 90-day terms. From the day you incorporate, the tax office and Bağ-Kur will expect their fixed payments every single month whether you bring in revenue or not.

Two years ago, I left a similar salary level and went straight into setting up a limited company. That was my biggest regret. While your revenue hasn't settled yet, the notary expenses chamber of commerce fees, ledger notarizations and the sheer difficulty of closing down a limited company took a serious psychological toll on me. Starting out as a sole proprietorship and only switching to a limited company once your annual turnover exceeds a certain threshold is a much smarter move.

Let me share the exact numbers for the sole proprietorship I set up last year: I paid 14.000 TL upfront for a year of virtual office space. My accountant charges 3.000 TL a month. The e-signature and e-fatura credits came to 4.000 TL. Even in months where I didn't issue a single invoice, 8.400 TL came straight out of my pocket for Bağ-Kur and stamp taxes. My mandatory baseline operating cost for 12 months came out to exactly 124.000 TL.

Here should be your setup checklist: 1) Pick a CPA who knows the regulations on tech and software exports inside out. 2) Get a virtual office instead of using your home address; otherwise, you'll get stuck dealing with withholding tax (stopaj) for the landlord and lease agreements. 3) Complete your e-signature and e-fatura integration the very day your company is approved.

Invoices issued to foreign clients are exempt from VAT (export of services). However, to qualify for the 80 percent corporate/income tax exemption, the funds must arrive in your Turkish bank account as a foreign currency transfer, there must be a written contract, and the invoice must be issued directly to the entity residing abroad.

That 250.000 TL in capital will easily give you 8-10 months of breathing room but plan as if you won't see a single cent of incoming revenue for the first 3 months. In software, projects always take longer than planned and client approvals get delayed... btw keep your spending down to a bare minimum and you'll navigate this transition smoothly. Best of luck!

if you're under 29 don't even think twice go with a sole proprietorship. with the young entrepreneur incentive the state covers your bağ-kur premiums for 1 year and you don't pay income tax up to a certain earnings threshold for 3 years. if you start an llc you're basically throwing all those massive cost advantages straight in the trash.

If you're on good terms with your current employer talk to them before submitting your resignation; offer to consult for them 1-2 days a week externally for the first 2-3 months and invoice them directly. This approach doesn't leave your old company in a bind, and it secures guaranteed cash flow for your new business during those crucial first months, cutting your risk down to practically zero.

let me clarify the technical side and the real issue isn't the number but what it's based on.

start with a small trial; don't commit to everything at once. btw i'm also curios if anyone does it differently.

Three different views emerged, they all complement each other. Mistaking revenue for cash is the most expensive illusion; trust the bank account.

Correct me if I'm wrong.

There's one point I'm curious about. Trying to do this alone is the most expensive way.

This is my opinion, I'm not claiming it's absolute truth.

I'd say don't rush. Any unwritten clause becomes a point of disagreement later, as both sides remember it differently.

If you post the result here, it will help others too.

we experienced almost the exact same thing last year then honestly everyone rushing into how to start a software comany gets stuck at the same point.

people defend habits not processes. resistance comes from there. proven by experience.

To get into the details: The longer you delay cutting the team, the more people it affects.

If you don't write this down from the start, it leads to arguments later. Proven by experience.

Let me speak from the other side; I'm on the supplier side. When making decisions, write down the worst-case scenario too, not just the best.

This is my opinion, I'm not claiming it's absolute truth.

Im in the same situation thats why Im asking. The moment you depend on a single client, you no longer set the price.

Delaying bad news is the habit that causes the most losses in this job. If you post the result here, it will help others too.

I went through the same thing.

Saved.