[repeek]

In a past life as a project manager for a custom software consultancy, we had a rule of thumb based on experience that a functional prototype[0] takes about 25% of a total project's budget.

Whether the contract was time & materials (preferred) or fixed bid, that 25% rule worked well as an early indicator that the project was likely to go over budget. It allowed us to have early conversations with the client about cutting scope or expanding the budget to cover the unknown complexity.

We'd also dramatically increase our rate to reduce our risk on fixed price projects.

[0] Barebones, ugly, but functional from end-to-end.