Web Development Business

How Profitable Is A Web Development Business? (Updated for 2024)

Pat Walls

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Updated: September 4th, 2024

How Profitable Is A Web Development Business? (Updated for 2024)

So you want to start a web development business?

And the first question that came to your mind was, “well, are web development businesses actually profitable?”

Especially considering:

You could start a web development business with as low as $1
Based on our data, web development businesses generate an average of $1.09M per year
You could see gross margins as high as 90% with web development businesses

There’s money to be made. Don’t worry.

But, I don't want to spoil it all. Below we’ll cover everything you need to know when it comes to the profitability of a web development business.

Let’s dive in!

Is a web development business profitable?

Yes, a web development business is generally a profitable business. However, you still need to consider several factors since these things always impact the overall outcome.

For instance, since average revenue is $1.09M per year with an estimated gross margin of 50%, you could expect to recover your investment within 12 months or even less.

But of course, it all comes down to how much you earn compared to the potential revenues of your web development business.

To determine whether your business is profitable, you should earn more than your expenses in the beginning months. However, while you're in your first month, it can be challenging to know what to expect.

Therefore, you should maintain a record of your monthly expenses and income to determine whether you're meeting your goals. By doing this step, you can see how your web development business is doing and if any changes or adjustments need to be made to enhance or maintain your efforts.

Is a web development business worth it?

If you’re wondering if a web development business is worth it, the answer is a big YES. With web development businesses, you have the potential to earn $1.09M per year (this is based on data reported by real founders).

Further, you could have your initial investment back within months. Simply put, it’s a business worth a shot, especially if you have the resources and make the necessary efforts to achieve or surpass the target.

With a market size of $, it will be possible for you to build something that grows and turns into a flourishing business. As such, it’s the type of business you might want to consider starting.

Of course, you must learn and understand every aspect of running a web development business to ensure success. Still, as long as you have the initial investment and can endure a few months before your actual gains, this business could be worth it.

You might want to consider reading more specifics about successful web development businesses case studies.

Examples Of Profitable Web Development Businesses

Here are a few examples of profitable web development businesses, and a few more details about them:

1. Create Circus ($288K/year)

Oliver, the founder of Create Circus, came up with the idea for his business while building his own Shopify branded business during the global lockdowns. He noticed that many stores lacked great branding and quality, so he began offering custom-built templates and designs to make stores stand out. Today, Create Circus has a turnover of around $24,000 a month and is expanding their services to include SEO, SEM, and TikTok marketing.

Is it profitable? Yes
How much money it makes: $288K/year
How much did it cost to start: $1K

How We Launched A $24K/Mo UK-Based Shopify Development Agency

Create Circus, a Shopify development agency that focuses on high-quality e-commerce store creation, started during the later end of the pandemic and has since turned over around $24,000 a month with two amazing full-time project managers and three full-time developers.

Read this case study

Read by 2,804 founders

2. Rise Visible ($96K/year)

Aunia Kahn, CEO of Rise Visible, started her digital marketing agency after receiving an old computer from a friend that had software like Dreamweaver and Adobe Photoshop. With no previous experience, she learned through trial and error and discovered her passion for digital marketing. Through solid work and referrals, Rise Visible has been able to attract and retain clients, leading to impressive revenue growth and recognition as a top-ranking woman-owned digital agency.

Is it profitable? Yes
What's the gross margin? 60%
How much money it makes: $96K/year
How much did it cost to start: $0

My Journey Building A 6-Figure Business As A Disabled Woman In Tech

Rise Visible, a full-service digital marketing agency, founded by Aunia Kahn, has achieved Top-Ranking Woman-Owned Digital Agency 2022 by Clutch and is rapidly approaching its first $100K year in revenue, solely through solid work, referrals, digital marketing through Google My Business, reviews, Facebook groups, social media and newsletters.

Read this case study

Read by 4,204 founders

3. Potion.so ($72K/year)

The idea for Potion.so originated from Noah's thesis that building on top of an existing platform is an effective strategy for creating an indie business. He felt that the approach leverages the established customer base and marketing channels of the platform.

Building on top of another platform is a great strategy for solo entrepreneurs and indie hackers. Your users are already there, making it easier to market your product. Many platforms even have a marketplace where you can list your product and gain customers. — Noah Bragg (Source: YouTube)

Noah had been using Notion and noticed a trend on Twitter where users were creating custom domains for their public Notion pages through a hacky project.

Observing that around 200 people were using this method, he realized there was a demand for a more streamlined solution.

This insight led him to develop Potion, which simplifies the process by allowing users to create websites with custom domains and personalized styling, while the content remains managed in Notion.

Is it profitable? Yes
What's the gross margin? 90%
How much money it makes: $72K/year

How Noah Bragg Built Potion.so to $69K ARR & Sold For $300K

Potion.so is a no-code website builder that transforms Notion pages into custom websites with personalized domains and fast page speeds, ultimately leading to its acquisition for $300K by a software engineer with a Bachelor's degree in Computer Science.

Read this case study

Read by 414 founders

Learn more about starting a web development business:

Where to start?

-> How much does it cost to start a web development business?
-> Pros and cons of a web development business

Need inspiration?

-> Other web development business success stories
-> Marketing ideas for a web development business

Other resources

-> Web development business tips

How much can you make with a web development business?

With a web development business, you can make an average of $1.09M revenue per year (based on data reported by real businesses).

You can start with an initial investment as low as $1. Then, with proper knowledge and sustained effort, you could have an ROI (return of investment) within 12 months.

How much does a web development business make a week?

Based on our data, average weekly revenue for a web development business ranges around $22.8K. As such, you could see monthly revenues of $91.1K.

To know if your web development business achieves the weekly profit target, you need to keep track of the total earnings you get per day. Afterward, you'll want to consider subtracting the expenses you have daily.

Learning your weekly profit can also show whether you're hitting your target goal for your web development business.

How much do web development businesses owners make?

The income of a web development business owner can vary depending on various factors such as location, size, competition, and the owner's business skills.

But to give you some idea, the weekly revenue of an established web development business is about $22.8K. But this can be lower or higher depending on so many factors - it's almost impossible to say exactly.

While the potential for earning a good income as a web development business owner exists, success in this field requires a commitment to providing quality products and services and building a strong reputation within the community.

Web Development Business Profit Margins

Generally speaking, a web development business can expect profit margin of around 50%. Profit margins refer to the percentage of revenue that remains after deducting all expenses associated with running a business. In the case of a web development business, profit margins can vary depending on various factors, such as the type and quality of products sold, the size of the store, and the level of competition in the area.

However, these figures can vary depending on the pricing strategy, inventory management, and overall efficiency of the business. To maintain healthy profit margins, web development business owners must focus on managing costs, negotiating favorable supplier terms, and providing high-quality products and services to attract and retain customers. By doing so, web development business owners can ensure long-term sustainability and profitability for their business.

Web development business owner salary

The salary of a web development business owner is an unpredictable figure. It's significantly influenced by numerous factors, including the store's location, its size, and the degree of competition. An owner of a well-established web development business, in a prime position, might see an average weekly salary around the ballpark of $11.4K.

But it's worth noting, such numbers aren't always consistent. The earnings can vary wildly, potentially swinging by as much as 80% either way.

Achieving consistent success and maintaining a reliable income stream in this industry requires a deep commitment. It's imperative to offer high-quality products, deliver impeccable customer service, and nurture a trusted bond with the community you serve.

Conclusion

In a nutshell, based on many of our examples, a web development business may be a promising business to start - but the success of your web development business mostly depends on your effort and your approach.

If you focus on these, you'll have a much higher chance of a profitable web development business.

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Starting A Web Development Business: Everything You Need To Know

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