“What should my marketing budget be?”

Every founder asks this. Most answers are useless. “10-20% of revenue” doesn’t help when revenue is $2,000/month.

Here’s how I actually think about it.

The Zero-Budget Phase

If you’re pre-revenue or barely revenue, your budget is $0.

That’s not failure. That’s appropriate.

At this stage, your marketing is:

• Direct outreach (free)
• Content creation (your time)
• Community participation (your time)
• Word of mouth (earned)

You’re trading time for money. That’s the deal when you don’t have money.

The First Real Budget

When to start spending: When you have paying customers and understand why they buy.

Spending before product-market fit is lighting money on fire. You’ll target wrong. Message wrong. Waste everything.

First budget: $500-1,000/month.

Not to scale. To learn.

How to Allocate $1,000/Month

Testing channels: $600

Split across 3 channels:

• Google Ads: $200
• LinkedIn Ads: $200
• Facebook/Instagram: $200

Run for 30 days. See what generates leads.

Kill the losers. Double down on the winner.

Tools: $200

Email platform (ConvertKit, Mailchimp): $30-50 Social scheduling (Buffer): $15 Design (Canva Pro): $15 Analytics (Google Analytics): $0 Landing pages (Carrd): $20

Keep it minimal. Fancy tools don’t fix bad marketing.

Content amplification: $200

Boosting content that performs organically.

Blog post getting traffic? Boost it. LinkedIn post getting engagement? Promote it.

Don’t amplify losers. Amplify winners.

Tracking ROI at Small Scale

You need to know: Cost per lead and cost per customer.

Cost per lead: Total spend / total leads

Cost per customer: Total spend / total customers acquired

If you spend $1,000 and get 50 leads that become 5 customers, your CAC is $200.

Is $200 good? Depends on lifetime value. If customers pay $50/month and stay 12 months ($600 LTV), $200 CAC is great. 3:1 LTV:CAC ratio.

If customers pay $50/month and churn in 3 months ($150 LTV), $200 CAC is death.

Know your numbers before scaling spend.

When to Increase Budget

Increase when:

• CAC is profitable
• You’ve found a channel that works
• You can handle more customers

How much: Double it. If $1,000/month at $200 CAC still works at $2,000/month, keep going. When CAC increases significantly, you’ve hit diminishing returns.

The Budget by Revenue Framework

$0-5,000/month revenue: $0-500 marketing budget Focus on product and direct sales. Marketing is your time, not money.

$5,000-20,000/month revenue: $500-2,000 marketing budget Test channels. Build systems. Find what works.

$20,000-50,000/month revenue: $2,000-8,000 marketing budget Scale what works. Add team capacity.

$50,000+ revenue: 10-20% of revenue Now the “standard” advice applies.

What Most Founders Get Wrong

Spending before understanding

Don’t run ads before you can articulate why customers buy. You’ll target blindly.

Spreading too thin

$100 on 10 channels is $0 insights. $1,000 on one channel is useful data.

Expecting instant results

Marketing compounds. Early spend is tuition. Returns come later.

Ignoring organic channels

Paid can’t fix bad fundamentals. If your product isn’t share-worthy, ads just accelerate failure.

My Current Allocation

We’re at about $8,000/month marketing spend:

Content + SEO: $2,500 (writer, tools) Paid acquisition: $3,500 (Google, LinkedIn) Email: $500 (platform, tools) Events/partnerships: $1,000 Buffer: $500 (testing new channels)

70% to channels we know work. 20% to improving those channels. 10% to experiments.

The Honest Truth

Most marketing money is wasted.

The winners find one or two channels that really work and dominate them. The losers spread thin and blame marketing for not working.

Start small. Learn fast. Scale what works.

And remember: The best marketing is a product worth talking about. Spend on product first.