Over one million euros in personnel costs since January, around 150,000 euros in fixed costs per month, almost 100,000 euros in travel expenses and 18,000 euros for every new employee before they earn a single euro. An open look at the numbers of an IT consultancy with 25 people, and why I have been reinvesting almost everything for seven years.
In the last few videos I talked a lot about AI, about what is currently going wrong in the AI world and what companies need to do. Today is about entrepreneurship, and specifically about numbers. It is October, the year is coming to an end, planning for next year is underway. A good moment to give you an inside look at where we stand at SIFAMO on the cost side and why we are currently not in the mode of taking a lot of money out of the company. Quite the opposite.
Recorded in Frankfurt am Main, October 2026. All figures in the video are backed by sources, the links are in the video description.
Why every entrepreneur needs to know their numbers
Anyone running a GmbH or UG needs an overview at all times: how many staff do I have, what are the personnel costs, what other costs are running, depreciation, purchasing. The monthly management report, known in Germany as the BWA, is the tool for that. For us as an IT consultancy that works on site with clients, bringing its expertise and showing, especially in the AI space, how to introduce AI sensibly, the biggest cost center is obvious: personnel.
Why we only hire very good people
In our industry, in my view, a basic degree with a few years of internships is not enough. We value a completed university degree, and by now we also pay attention to which university someone comes from. Nothing against universities of applied sciences, but AI consulting requires a certain depth, a deep understanding of the subject, and we see that more often in graduates of research-oriented or technical universities. That has served us well. But people like that cost money.
What a new employee really costs
Take a somewhat more experienced developer with an annual salary of 55,000 euros. That is around 4,500 to 4,600 euros gross per month. With employer contributions, this employee effectively costs me just under 6,000 euros a month. The first three months are pure investment: interviews, onboarding, colleagues who invest time and prepare them for client projects, and of course the full salary. That adds up to around 18,000 euros before a new employee generates the first euro for us.
Personnel costs 2026: A little over one million euros in the first ten months, with just under 25 employees and further growth.
Shared costs on top: Office, rent, licenses, laptops, smartphones, training, workshops, team events. Everyone starts with good equipment at our company.
Fixed costs per month: As of today, about 150,000 euros including employer contributions. That is the minimum we have to generate to break even.
The sample calculation: 200,000 euros in revenue, 20,000 euros in profit
Imagine we generate 200,000 euros in revenue in one month. After personnel costs, 50,000 euros remain, the remaining costs come off that, and at the end there may be 20,000 euros in profit. That is a projection, I will show the actual revenue in a separate video at the end of the year. Over the year, that could add up to 200,000 euros in profit. And then, as an outsider, you quickly think: he is putting that in his own pocket.
Pocket the profit or reinvest?
You can do that. My motto is a different one: there is no point in pulling the money out if the company then lacks liquidity. We want to grow and get better, so we reinvest. For us that means: workshops, further training, company events. Once a year, all employees take a full day off from projects. There is no revenue on that day, the lost billing alone costs us at least 20,000 euros, plus travel expenses and preparation. We do it anyway, because we would rather invest in quality than be irrelevant after a year.
Since founding the company seven years ago, I have reinvested almost 100 percent of the profits. That is why we are still here today and still relevant. The order situation is improving, we need more and more people, and we have employees who have been with us for many years, some since day one. They feel the appreciation, and that is exactly what pays off. How we got to this team in the first place is something I talk about in my post on the journey from developer to entrepreneur (German).
The other items: tax advisor, travel, licenses, office
Tax advisor: Not cheap, but necessary. A good tax advisor makes sure the taxes flow out cleanly.
Travel expenses: An enormous item in consulting. A team traveling to the client, train journeys, hotels, that quickly adds up to a few thousand euros. This year we are already at almost 100,000 euros.
Licenses and hardware: Laptops, tool licenses, office suites in a business environment. Well over 10,000 euros a year.
Berlin office: Over 200 square meters, 7,000 to 8,000 euros a month, so almost 90,000 to 100,000 euros a year. That is where our team days and client meetings take place.
Total costs 2026: 1.3 to 1.4 million euros
To date, we have generated costs of about 1.3 to 1.4 million euros this year. Last year we deliberately came out at zero: bonuses paid out to employees, investments in workshops and events. The good thing about it: because we invested, we have grown by seven employees this year, the projects are stable, and next year is looking very good.
One more thing, especially for everyone who is just starting out: you grow with the numbers. My first annual revenue was somewhere around 30,000 to 35,000 euros. These costs do not appear overnight, you grow into them and get used to them. There are days when you are startled by what you spend each month. But once you have understood how to run a business, in my view you can build a company again and again. How do you handle profits, distribute or reinvest? Let me know on LinkedIn or under the video on my YouTube channel.
Frequently asked questions
What does an employee at an IT consultancy cost in the first quarter?
At an annual salary of 55,000 euros, around 6,000 euros per month including employer contributions. With onboarding and colleagues’ time, it is about 18,000 euros for the first three months, during which no revenue is generated yet.
Why not distribute the profit?
Because liquidity carries growth. Reinvesting in training, equipment and the team ensures that the consultancy stays relevant in a market that reshuffles itself every year with AI, and that good people stay.
What is a BWA?
The BWA (betriebswirtschaftliche Auswertung) is the monthly management report in Germany showing a company’s revenue, costs and result. It is the tool an entrepreneur uses to keep an eye on personnel costs, fixed costs and profit long before the annual financial statements arrive.
Over one million euros in personnel costs since January, around 150,000 euros in fixed costs per month, almost 100,000 euros in travel expenses and 18,000 euros for every new employee before they earn a single euro. An open look at the numbers of an IT consultancy with 25 people, and why I have been reinvesting almost everything for seven years.
In the last few videos I talked a lot about AI, about what is currently going wrong in the AI world and what companies need to do. Today is about entrepreneurship, and specifically about numbers. It is October, the year is coming to an end, planning for next year is underway. A good moment to give you an inside look at where we stand at SIFAMO on the cost side and why we are currently not in the mode of taking a lot of money out of the company. Quite the opposite.
Why every entrepreneur needs to know their numbers
Anyone running a GmbH or UG needs an overview at all times: how many staff do I have, what are the personnel costs, what other costs are running, depreciation, purchasing. The monthly management report, known in Germany as the BWA, is the tool for that. For us as an IT consultancy that works on site with clients, bringing its expertise and showing, especially in the AI space, how to introduce AI sensibly, the biggest cost center is obvious: personnel.
Why we only hire very good people
In our industry, in my view, a basic degree with a few years of internships is not enough. We value a completed university degree, and by now we also pay attention to which university someone comes from. Nothing against universities of applied sciences, but AI consulting requires a certain depth, a deep understanding of the subject, and we see that more often in graduates of research-oriented or technical universities. That has served us well. But people like that cost money.
What a new employee really costs
Take a somewhat more experienced developer with an annual salary of 55,000 euros. That is around 4,500 to 4,600 euros gross per month. With employer contributions, this employee effectively costs me just under 6,000 euros a month. The first three months are pure investment: interviews, onboarding, colleagues who invest time and prepare them for client projects, and of course the full salary. That adds up to around 18,000 euros before a new employee generates the first euro for us.
The sample calculation: 200,000 euros in revenue, 20,000 euros in profit
Imagine we generate 200,000 euros in revenue in one month. After personnel costs, 50,000 euros remain, the remaining costs come off that, and at the end there may be 20,000 euros in profit. That is a projection, I will show the actual revenue in a separate video at the end of the year. Over the year, that could add up to 200,000 euros in profit. And then, as an outsider, you quickly think: he is putting that in his own pocket.
Pocket the profit or reinvest?
You can do that. My motto is a different one: there is no point in pulling the money out if the company then lacks liquidity. We want to grow and get better, so we reinvest. For us that means: workshops, further training, company events. Once a year, all employees take a full day off from projects. There is no revenue on that day, the lost billing alone costs us at least 20,000 euros, plus travel expenses and preparation. We do it anyway, because we would rather invest in quality than be irrelevant after a year.
Since founding the company seven years ago, I have reinvested almost 100 percent of the profits. That is why we are still here today and still relevant. The order situation is improving, we need more and more people, and we have employees who have been with us for many years, some since day one. They feel the appreciation, and that is exactly what pays off. How we got to this team in the first place is something I talk about in my post on the journey from developer to entrepreneur (German).
The other items: tax advisor, travel, licenses, office
Total costs 2026: 1.3 to 1.4 million euros
To date, we have generated costs of about 1.3 to 1.4 million euros this year. Last year we deliberately came out at zero: bonuses paid out to employees, investments in workshops and events. The good thing about it: because we invested, we have grown by seven employees this year, the projects are stable, and next year is looking very good.
One more thing, especially for everyone who is just starting out: you grow with the numbers. My first annual revenue was somewhere around 30,000 to 35,000 euros. These costs do not appear overnight, you grow into them and get used to them. There are days when you are startled by what you spend each month. But once you have understood how to run a business, in my view you can build a company again and again. How do you handle profits, distribute or reinvest? Let me know on LinkedIn or under the video on my YouTube channel.
Frequently asked questions
What does an employee at an IT consultancy cost in the first quarter?
At an annual salary of 55,000 euros, around 6,000 euros per month including employer contributions. With onboarding and colleagues’ time, it is about 18,000 euros for the first three months, during which no revenue is generated yet.
Why not distribute the profit?
Because liquidity carries growth. Reinvesting in training, equipment and the team ensures that the consultancy stays relevant in a market that reshuffles itself every year with AI, and that good people stay.
What is a BWA?
The BWA (betriebswirtschaftliche Auswertung) is the monthly management report in Germany showing a company’s revenue, costs and result. It is the tool an entrepreneur uses to keep an eye on personnel costs, fixed costs and profit long before the annual financial statements arrive.
Related: Umair Zaffar as AI Expert
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