How much does it cost to start a consultancy?
About $25,600 all in for a small one, opened by one founder in an American city: $9,140 to open the doors and $16,500 to keep going for the 4 months it typically takes to pay its way. Below, every item at low, typical and high with where it comes from — and your own quote, for your country, your town, how you start and the money you have.
To open: $9,140
Laptop and phone: $2,000 ($1,200–$3,500). Our estimate: no published figure was found for this item.
Professional liability (E&O), first year: $850 ($600–$2,500). NerdWallet citing Insureon: median professional liability $59/month (~$708/yr); QuoteSweep $500-$3,000/yr for low-risk professions
General liability / BOP, first year: $494 ($350–$800). Insureon marketing-consultant cost page (2025): median general liability $29/month ($350/yr), BOP $41/month ($494/yr), E&O $55/month ($654/yr)
Website and brand: $2,500 ($500–$6,000). estimate; current file $3,000
Launch marketing and events: $1,500 ($500–$4,000). estimate; current file $3,000
Contract templates: $1,000 ($500–$2,500). estimate; Paraform puts a lawyer's review of terms at $700 upwards
Forming the company: $800 ($150–$2,500). An LLC's state filing is $50–$500 (state fee schedules), plus an EIN (free) and a registered agent; the World Bank measured the procedures at about 1% of income per capita, about $850 (Doing Business 2020); a lawyer's formation package $500–$2,000.
To keep going until it pays its way: $16,500
Running costs while sales build: $2,260 ($400–$14,000). Software and LinkedIn Sales Navigator, Marketing and networking, Bookkeeping, Travel to clients, Phone and internet, until it breaks even; sales are taken to grow evenly to cover them, so about half is needed. Break-even: Our estimate: a consultant leaving a job often starts with a former employer or network client; invoices run net 30
Your own living costs until it can pay you: $14,200 ($7,120–$32,000). A one-person household spends about $3,560 a month in America (BLS Consumer Expenditure Survey 2021–22); nothing is paid to you until the business breaks even.
All in: $25,600
About $25,600 all in ($11,300–$67,900): $9,140 to open and $16,500 to keep going for the 4 months it typically takes to pay its way.
With $10,000 of your own you are $15,600 short: borrowed as an SBA microloan at 11% over 5 years, about $340 a month.
The trade's published range, before the months it takes to pay its way: $5,000–$20,000. Consulting Success and SBA guides: $5k-$20k for a one-person consultancy (current file)
How much does it cost to start a consultancy?
About $25,600 all in ($11,300–$67,900) for a small one, from home, in an American city. To open: Laptop and phone $2,000; Professional liability (E&O), first year $850; General liability / BOP, first year $494; Website and brand $2,500; Launch marketing and events $1,500; Contract templates $1,000; Forming the company $800 — $9,140. To keep going for the 4 months it typically takes to break even: running costs while sales build $2,260; your own living costs until it can pay you $14,200 — $16,500. The trade's published startup range is $5,000–$20,000 (Consulting Success and SBA guides: $5k-$20k for a one-person consultancy (current file)), which leaves the months before it pays its way out.
What does SparkTower's simulator pay to open it?
The simulator pays the one-off opening costs before the first customer — the running costs and the founder's living it plays month by month: Laptop and software $3,000; Website $3,000; Professional indemnity insurance $2,000; Forming the company $2,000; Launch marketing $3,000. A one-person consultancy: $5k–$20k (Consulting Success and SBA guides); professional indemnity $1k–$3k a year (Insureon).
How much of that do you keep?
$3,000 of it — the kit, fit-out or stock it bought — is still yours afterwards, something a buyer would pay for and a lender would lend against; the other $10,000 is spent.
What if my own money doesn't cover it?
With $10,000 of your own you would be about $15,600 short. Borrowed as an SBA microloan at 11% over 5 years, that is about $340 a month. Most founders borrow the rest. A small-business term loan runs about 11% a year over 5 years (SBA 7(a) loans are the prime rate plus 3 to 6.5 points), repaid every month from the start — before the business has found its customers. In SparkTower's consultancy simulator the founder starts with $25,000 of their own money; the launch costs come out of it and leave $12,000 to trade on, with nothing borrowed.
Can you start a consultancy with no money?
Not in full: lenders want the owner to put in about 20% (the SBA's own floor for a start-up is 10%), and lend against the kit, fit-out and stock a launch buys, not its marketing or a software build. What a founder with nothing does is open smaller — a consultant working from home — on about $1,800 of essentials (software $500; professional indemnity insurance $1,000; forming the company $300), borrowed as a microloan (the SBA's are up to $50,000, at 8–13%) or, for a few thousand dollars, on a card at about 22%. The rest is bought once the business can afford it. A solo consultant: professional indemnity $1k–$3k a year (Insureon), a laptop they own.
Will it earn the money back?
That depends on what you charge, how many customers you win and what your rivals do. The free consultancy simulator pays these costs before it opens, borrows what the founder's cash doesn't cover, and plays the business forward against real rivals, so you can see whether it earns them back before you spend them.
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