SaaS is sometimes referred to as “on-demand software”. SaaS is typically a service you login to online and subscribe on a monthly or yearly basis. Here are 10 things I have learned from starting our own SaaS businesses.
1. Creating the Service Goes Beyond a Developer
I have talked with a number of business owners who are looking to build a web application. They say that they just need a Developer (Programmer) to build what they are looking for. We have found that building a web app actually requires a few key positions, Designer, Developer and System Architect at least.
The System Architect is the one that is mostly missing and is there to help interface between what the users would need and getting it executed by the Designers and Developers. A good System Architect is worth their weight in gold.
2. Don’t Underestimate the Cost of Acquiring Customers
With almost 1,000,000,000 websites out there, it will definitely take some work to stand out.
The barrier to entry for online applications has reduced to the point that “everyone is doing it”.
We suggest that you build a tool that focuses on solving problems for a very specific customer base, one you are familiar with.
3. Focus on Selling Customers Every Month
Monthly recurring money is very exciting. It’s also not permanent.
So there are really two parts to the sales process. The initial selling of a customer. Then continuously making them right for their decision. There can be simple things you can do such as sending out ideas of how to get results and success with your platform, training, follow up, etc. that will make you stand out and make them happy that they are using your tool.
4. Scaling Isn’t Automatic
Just because you have one way of acquiring customers doesn’t mean that it’s scalable. We have found that we needed to add multiple ways of acquiring customers, and all coming together, you can create big growth…fast.
5. Using Offline to Scale Online
If you decide to focus on specific verticals, you will find ways that you can get exposure, referrals and customers from your offline activities. We always suggest starting with existing networks of potential customers. You can develop relationships that can contribute to long term friendships, but also be a source for a lot of business.
5. Always Start With How You Can Help Someone
Put yourself in the shoes of your different publics (groups of customers, referrers, etc.) and figure out how you can help them solve a problem. You might find that there are multiple groups of people that you can help solve problems for, combining these, you can create great success.