10 tips for building a successful Software as a Service business

10 tips for building a successful Software as a Service business

Before you consider starting a successful Software as a Service business, you should first understand what SaaS is. It is a cloud-based software delivery model in which users access the software via a web browser or a web-based app. They can now access the software they require more readily and easily from anywhere in the world. As a subscription-based revenue model, it generates a steady stream of recurring revenue, making it profitable.

For your Software as a Service business to succeed over the long haul, you must be committed, diligent, careful in your planning, adaptable, and driven. The 10 tips in this article will help you run a successful Software as a Service company. It includes the following.

• Identify and solve a problem
• Make a lean business plan
• Verify your SaaS idea
• Learn about pricing models
• Get your brand out there
• Legalise the brand
• Get the funds
• Develop a minimum viable product
• Build strong SaaS marketing and sales strategy
• Set success metrics

1. Identify and solve a problem

The first step in starting a business is always to identify a problem and find a solution. So it is important in business to have a problem to address and a solution that alleviates it. After all, a business is all about finding a solution to a problem and making revenue from it. There are many ways to find a problem that is worth solving. 

• One way would be to fix a problem better than anyone else. If you can solve a problem for someone and do it better, quicker, and cheaper than your competitor, then you are off to a good start in your SaaS business. 
• The second way will be to find a solution to a problem that is relatable to you. The SaaS business you start should solve your real problems, not someone else’s. Solving a problem you have struggled with will help you solve the problem in the best possible way. 
• The next option is to use your industry knowledge to solve a problem. You can draw on your professional experience in the industry to address a user issue.

2. Make a lean business plan

Now, you should write up a business plan about the strategies, tactics, and business models you will use. The write-up should have a strategy section with a description of the problem you’re solving for your customers and your solution to the problem, which is usually your product or service. It should also include who the target audience is.

Describe how your products will be sold, list your partners and resources, and describe your core team and their roles in the business plan. Also, create a rough budget, write about the business model, and document how your company will make money.

3. Verify your SaaS idea

The next tip will be to validate your SaaS idea by communicating with the users, conducting a competitive analysis, and creating a minimum viable product. You can use the users’ feedback to revise your business plan for your own good. Also, keeping an eye on your competitors is a great idea to determine whether you are heading in the right direction. 

Developing a minimum viable product, or MVP, is another excellent and essential testing strategy in the SaaS industry. By doing this, you can assess your idea’s potential to grow into a profitable company. 

4. Learn about pricing models

SaaS products usually use subscription-based pricing models, and you can explore and decide on the various pricing models for your product or service as the next step. It can be paid once in a lifetime or on an ongoing basis, monthly or annually. Before officially establishing your pricing model, you can test it and determine how it will affect your path to profitability in the SaaS business. 

5. Get your brand out there

The next tip is to position your brand so that it stands out. Try to make your SaaS product or company draw attention from users. It should have a brand guide so that the users can have clarity about the product’s vision. You can do competitor research to establish a brand that differs from the other competitors’ brands.

6. Legalise the brand

Making the SaaS company legal should be the next step. There are some industry-specific rules and regulations that a brand should follow when starting a company. You should legally register a company with a clear business structure and pick a name for your business before registering it. Make sure it’s not already in use, close to the name of another business, or even make sure the URL and social media handles are still available.

7. Get the funds

Now, you should find funding for your business. One option is to manage independently, while the other aims for a larger amount of capital immediately by pitching an angel investor or a venture capitalist for funding. Starting from scratch is smart because it gives you total control over the company, allowing you to run it how you see fit and collaborate with whomever you choose. 

8. Develop a minimum viable product

SaaS startups begin with a minimum viable product (MVP) that has the essential features and attends to the most important requirements of the target market. Before making the product more widely available, you can test it and get feedback from early users, which can help you hone and improve it. You should use agile development methodologies for the development of the SaaS product. 

9. Build strong SaaS marketing and sales strategy

Developing a go-to marketing strategy is another important step for building a successful Software as a Service company. Paid advertising, affiliate relationships, proactive media relations, and content marketing are all effective ways to market your product. You can combine these techniques.

10. Set success metrics

Tracking the success metrics is like checking on their health. You can make better decisions, relieving you of much guesswork. You can determine how to grow and whether it’s a good time to do so by monitoring your key performance indicators. It can improve the current and future performance of the business.

Here are the 10 tips you can use for your Software as a Service company. It’s not simple to start such a business. Making it successful requires a lengthy process. You should have a clear vision for a well-designed product as well as a solid marketing strategy. It is possible to build a thriving SaaS business that delivers value to your customers if you work in an innovative and agile way.

Interesting Links:

How does a SaaS Company work?

More information about Software as a Service

Pictures: Canva

The author: Sascha Thattil works at Software-Developer-India.com which is a part of the YUHIRO Group. YUHIRO is a German-Indian enterprise which provides programmers to IT companies, agencies and IT departments.