By Adrian Huber, CEO of Corient, a B2B marketing agency.
November is when most founders set next year's numbers. And one question comes up every time: how much should a startup spend on marketing? Too little and growth stalls. Too much and you burn cash on channels that haven't proven they work.
There's no perfect number, but there is a sensible starting point. This article covers the latest SaaS marketing spend benchmarks, what they mean in real dollars, how bootstrapped and funded companies differ, and how to split your 2027 marketing budget across channels. It's written for founders of tech companies between $3M and $30M in revenue.
Key takeaways
- The median private B2B SaaS company spends 8% of its annual recurring revenue (ARR) on marketing, and 15% on sales.
- Funding changes the number. Equity-backed companies spend about twice as much on marketing as bootstrapped ones.
- At $5M in yearly revenue, 8% is about $400,000 a year, or roughly $33,000 a month. That covers people, tools, content and media, not just ads.
- Set your budget from your growth target and your CAC payback, not from a percentage alone.
- Put most of next year's budget behind channels you've proven, and ring-fence a smaller share for tests.
How much should a startup spend on marketing?
As a starting point, plan to spend somewhere between 5% and 10% of your yearly recurring revenue on marketing. The median sits at 8%. Then adjust up or down based on how fast you want to grow, how much cash you have, and how quickly your marketing pays back.
That range comes from the most current benchmark for software companies, SaaS Capital's 2026 spending benchmarks. Its 15th annual survey, completed in March 2026, drew responses from more than 1,000 private B2B SaaS companies. Treat the figures as general guidance. They describe what companies spend, not what you should spend.
A quick note on ARR. It stands for annual recurring revenue: the yearly value of your subscriptions. If you don't sell subscriptions, use your yearly revenue instead.
SaaS marketing spend benchmarks
Here's how the median private SaaS company spends, as a share of ARR, according to SaaS Capital:
- Marketing: 8%, unchanged from the year before.
- Sales: 15%, up from 13%.
- Customer support and success: 9%.
- Research and development: 22%.
- General and administrative: 15%.
For companies with $3M to $5M in ARR, the medians are similar: 8% on marketing and 12% on sales.
Bootstrapped vs funded
Funding has the biggest effect on spend. SaaS Capital reports that equity-backed companies spend 100% more on marketing and 70% more on sales than bootstrapped ones. In its 2026 chart, that's roughly 5% of ARR on marketing for bootstrapped companies and roughly 10% for equity-backed companies.
The trade-off shows up in growth and profit:
- Bootstrapped companies reported median growth of 20% a year. Venture-backed companies reported 25%.
- 83% of bootstrapped companies were profitable or within two points of breakeven, against 52% of equity-backed companies.
In other words, doubling marketing spend didn't double growth. Funded companies bought a few extra points of growth with a lot more spend. That can be the right choice, but it should be a choice.
What that looks like in real dollars
Percentages are easy to agree with and hard to plan with. Here's a worked example for a company with $5M in yearly revenue. These are illustrative numbers based on the benchmarks above, not a recommendation for your business.
- Lean, around 5%: $250,000 a year, or about $21,000 a month.
- Median, 8%: $400,000 a year, or about $33,000 a month.
- Growth mode, around 10%: $500,000 a year, or about $42,000 a month.
Now remember what that number has to cover. A marketing budget isn't just ad spend. It usually includes:
- People: salaries, contractors or an agency.
- Tools: CRM, email, analytics, design and automation software.
- Content: writing, video, design and events.
- Media: paid search, LinkedIn, Meta and other paid channels.
So once people and tools are covered, the paid media line is often much smaller, for example $5,000 to $25,000 a month. Spent well, that's enough to prove and scale one or two channels. Spread across six, it's enough to prove none.
How to split $5k to $25k a month across channels
Start with a simple rule: most of the budget goes to what's working, a smaller share to the next best bet, and a small share to experiments. Here are two illustrative splits. Adjust them to your own data.
At $5,000 a month in media
- About 70% to one proven channel. Usually paid search for products people already look for, or LinkedIn for a tightly defined B2B audience.
- About 20% to retargeting people who visited your site or engaged with your content.
- About 10% to one small test, run against a written pass or fail threshold.
At this level, don't run more than one main channel. Our post on why you should prove one channel before adding another explains why.
At $25,000 a month in media
- About 50% to your proven channel, scaled carefully while cost per customer holds.
- About 25% to a second channel that has passed a test.
- About 15% to retargeting and nurture across platforms.
- About 10% to new tests.
The split matters less than the rule behind it. No channel gets more budget until it has proven it can bring in customers at a cost that pays back.
Set your budget from payback, not a percentage
Benchmarks give you a range. Your unit economics tell you where in that range to land. The most useful number is CAC payback: how many months it takes to earn back what you spent to win a customer.
Work backwards from your growth target:
- Set the target. For example, 60 new customers next year.
- Check your cost to win a customer. Say your fully loaded customer acquisition cost (CAC), including sales and marketing, is $4,000.
- Multiply. 60 customers × $4,000 = $240,000 in sales and marketing.
- Check payback. If each customer brings in $250 a month in gross profit, that $4,000 pays back in 16 months, right at the median for SaaS.
- Compare with the benchmark. If the number you need is far above what the benchmarks suggest, either your CAC is too high or your target is too ambitious for your cash.
Again, these are illustrative numbers. Our guide to what a good CAC payback period looks like for SaaS covers the formula and benchmarks in detail.
If payback is short and steady, you can afford to spend towards the top of the range. If it's long or unclear, spend towards the bottom until you fix it.
Signs your marketing budget is too low or too high
Too low
- You have proven channels with good payback, but you're capping spend.
- Your pipeline depends on the founder's personal network.
- Competitors show up everywhere your customers look, and you don't.
Too high
- You can't say which channels produce customers, only leads.
- Budget is spread across many channels, none with enough spend to learn.
- Your cost per customer is rising while lead volume looks healthy.
If it's the second list, more budget won't help. Our post on why evidence-based marketing beats guesswork covers how to fix the measurement first.
A simple 2027 marketing budget plan
- Step 1: Look back. Pull this year's spend by channel and match it to customers won, not leads.
- Step 2: Rank channels by cost per customer and payback.
- Step 3: Set the total using your growth target and payback, then check it against the 5% to 10% benchmark range.
- Step 4: Split it. Most to proven channels, some to the next best bet, a little to tests.
- Step 5: Set review points. Review monthly and move money quarterly. A budget is a plan, not a promise to keep spending.
- Step 6: Map it to the calendar. Plan campaigns around the moments that matter to your customers, from budget season to the end of the financial year.
This is the same Build, Prove, Scale logic we use with every client, set out in our Build, Prove, Scale framework.
The bottom line
A sensible SaaS marketing budget is between 5% and 10% of yearly recurring revenue, with the median at 8%. At $5M in revenue, that's roughly $250,000 to $500,000 a year, covering people, tools, content and media. But the benchmark is only a starting point. Set your final number from your growth target and your CAC payback, put most of it behind channels that have proven they bring in customers, and keep a small share for testing what's next.
Frequently asked questions
How much should a startup spend on marketing?
A common starting point for software companies is 5% to 10% of yearly recurring revenue. SaaS Capital's 2026 survey of more than 1,000 private B2B SaaS companies found a median of 8% on marketing and 15% on sales. Adjust the number to your growth target, cash position and how quickly your marketing pays back.
How much do SaaS companies spend on marketing?
The median private B2B SaaS company spends 8% of annual recurring revenue on marketing, according to SaaS Capital's 2026 benchmarks. Equity-backed companies spend about twice as much on marketing as bootstrapped ones, roughly 10% against 5% of ARR in SaaS Capital's chart.
What should a SaaS marketing budget include?
A marketing budget usually covers people (salaries, contractors or an agency), tools (CRM, email, analytics and automation), content (writing, video and design) and paid media. Sales costs, such as sales salaries and commissions, are usually budgeted separately. Make sure you compare like with like when you use benchmarks.
How do I set a marketing budget for 2027?
Start with your growth target for the year, multiply the number of new customers you need by your fully loaded cost to win a customer, and check the result against your CAC payback and the 5% to 10% benchmark range. Then put most of the budget behind proven channels and set monthly review points.
Should a bootstrapped startup spend less on marketing?
Usually, yes. In SaaS Capital's 2026 data, bootstrapped companies spent about half as much on marketing as equity-backed companies, and most were profitable or close to breakeven. They also grew only a little more slowly. Spend more when you have a channel with proven payback, not because a benchmark says so.
What percentage of revenue should go to marketing?
For software companies, 5% to 10% of revenue is a sensible starting range, with the SaaS median at 8%. Companies in growth mode, or backed by investors, often spend more. The right figure for you depends on how efficiently your marketing turns spend into customers.
Planning your 2027 budget? Corient works as a full marketing department for founder-led brands: a CMO, design, copy, paid ads, email and automation, and web and tech. We'll help you set the number from your payback, put it behind the channels that prove themselves, and report on customers won, not just leads. Start your free trial and your first month is on us.
