Six Tips For Starting A Software As A Service (SaaS) Company
Getting an SaaS company right can be a very lucrative and rewarding achievement – however the trick is to do just that – get it right. Here are six tips to help you do so and succeed.
Start Small
The bottom up strategy is commonly applied in the SaaS industry; something that any seasoned experts in this field will tell you. To implement this strategy, you simply need a bare bones concept that comes with a minimal number of features in the beginning. Offering a fully functional service is easier with this approach as it gives you better control over your scope.
Start by focusing on a smaller audience, using the internet to attract clients, and then as you increase the number of features on your service, expand your focus to a broader audience/target market. Simply put, you need to grow the number of features on offer slowly, while keeping the minimal features you started with as you expand your reach. While you do this keep a close eye on your SaaS metrics.
The likelihood of failure on your part, especially when it comes to hardware delivery and operating costs, is minimized by the implementation of this strategy. Remember that the maintenance of software, hardware and remote systems, which tends to be a resource intensive process in itself, is your responsibility. Before you shift to bigger goals, keep your focus on your initial offering first.
Remember that you can still expand your company as fast as you please, even as you follow this strategy. The main point here is to keep your goals as small as possible at the start. Expanding by up to 56% each year, the fastest expanding SaaS companies grow their business quite quickly.
Go The Mobile Way
In response to their mobile oriented audience, in increasing number of businesses are shifting their focus to mobile experiences, which involve focusing on mobile apps and devices. Hence, at the very least, your approach should have a cross-platform focus, or solely focused on mobile, while treating desktop as an option.
When it comes to managing their businesses, up to 43% of business owners rely on their mobile devices, according to Intuit. Additionally, desktop has long been overtaken by mobile when it comes to customers as well. From the start, you will be ignoring a huge portion of your customer base if your service doesn’t support mobile usage.
For Growth, Seek Inspiration From Your Customers
You will need to prioritize some elements, features and use cases of the service during the growth and development of your product. Considered to be a response to the way your customers utilize your service, this natural occurrence is mostly driven by necessity. Of course, you should still determine the course of your service’s growth. However, customer insights can also help the course of this growth as well. Don’t forget that day after day, these are the people that will be using your service.
The people who are closely linked with your services and products can act as a great source of inspiration for new ideas, especially considering the fact that there will always be room for improvement. You will be better off the sooner you recognize this fact and consider it as you grow your business.
Subscriptions Are Key
There is no guarantee that you, as a consumer, will buy future products or pay for updates and improvements once you make the initial purchase. It is important for you to realize that even though you may want all your customers to continue supporting your brand for years to come, the reality is quite different.
In the SaaS industry, the idea way to generate revenue is by using a subscription based pricing model. This way you will be able to raise the money you need to support future product improvements, maintenance and operations from the consistent and continuous stream of revenue generated. This is vital because, after taking the necessary resources into account, hardware and human, the operation of a SaaS company can cost a lot.
Take The Law Into Consideration
It is worthwhile for you to familiarize yourself with any guidelines, regulations and laws applicable in the area you intend to offer your services. This not only guides your operational structure for complete compliance but also ensures that you have all your bases covered in case anything comes up.
The legal environment within which these services are provided is generally lacking or underdeveloped, as it stands. This means that things are bound to change with time as government authorities are still learning the ins and outs of the industry. To put things into perspective, consider this recent tax department ruling, a video cloud service provider based in California was found to be liable for sales tax on their solution due to the fact that they have a New York office. The local tax department made this decision, even though it might seem absurd.
Since your service may be affected sooner or later, it is important for you to familiarize yourself with any relevant regulations and rulings. You can either hire a team of legal experts to do this or assign this task to an in-house team.
Prioritize Customer Service
Of course it is only reasonable to assume that you will have some clients who require assistance once you start offering services. Whether it is during the set up phase, learning how to use different features, your customers will need assistance. You can see how easy it is for companies to lose clients when you combine all that with how Software as a Service is utilized by individuals.
Every employee and department in your company should be committed to offering accurate and effective assistance to clients as and when needed; emphasizing on the importance and value of customer care. Your clients will be more willing to continue working with your company if they feel that you are providing all the support and assistance they require.
Anyone who is interested in working with your company should be assisted as soon as possible, preferably without making them wait for hours or even days. Your customer support should be continuously available, the same way that SaaS services should always be up.
