Glossary · Contracts & Pricing · 4-min read
Fixed-Price Milestone Contract
Skip to content
Definition: A fixed-price milestone contract is a software development agreement where total project scope is divided into sequential deliverables with predetermined costs and acceptance criteria. Client payments are held in escrow and released only after verified code review, CI/CD deployment, and functional staging verification within 4 to 12 weeks.
Early-stage founders hiring an external software agency face a structural misalignment with Time-and-Materials (T&M) billing: every delay or bug increases the agency's revenue. A fixed-price milestone contract reverses that risk by binding payment releases to verifiable working software deployed on a staging URL.
Milestone Phase | Typical Sprint Window | Escrow Payment Split | Objective Acceptance Gate |
|---|---|---|---|
Milestone 1: Architecture & UX | Weeks 1 -- 2 | 20% of Fixed Ceiling | Clickable Figma prototype + PostgreSQL schema + API specification signed off |
Milestone 2: Core Data & Auth | Weeks 3 -- 4 | 30% of Fixed Ceiling | Live staging URL with working authentication, RBAC permissions & CRUD flows |
Milestone 3: Payments & Logic | Weeks 5 -- 6 | 30% of Fixed Ceiling | End-to-end Stripe Connect checkout, webhooks & third-party APIs passing E2E tests |
Milestone 4: QA & Production Launch | Weeks 7 -- 8 | 20% of Fixed Ceiling | Zero-overflow mobile QA, production deployment, Git handover & 6-month warranty active |
Payments are typically divided across 4 sequential milestones: 20% at architecture and wireframe sign-off (M1), 30% at core database and auth completion (M2), 30% at payment and workflow integration (M3), and 20% upon production QA and repository handover (M4).
Under a fixed-price milestone contract with a hard price ceiling, the engineering studio absorbs 100% of internal hour overruns for in-scope features at zero additional cost to the founder.
Tour live marketplaces, YC-backed MVPs, and architecture teardowns built by our senior team.
View Client Case Studies →See fixed-price sprint breakdowns, weekly milestone rates, and our 6-month code warranty.
Explore Pricing & Scopes →Direct 15-minute scoping call with Saif Akhtar (Head of Product & Engineering). No sales reps.
Book 15-Min Scoping Call →Payments are typically divided across 4 sequential milestones: 20% at architecture and wireframe sign-off (M1), 30% at core database and auth completion (M2), 30% at payment and workflow integration (M3), and 20% upon production QA and repository handover (M4).
Under a fixed-price milestone contract with a hard price ceiling, the engineering studio absorbs 100% of internal hour overruns for in-scope features at zero additional cost to the founder.
Tell us what you're building. After an intro call with our founders, you'll hear back within 72 business hours: a written scope with an hour range and a hard ceiling, or the questions we need answered first.