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Building a SaaS

 

Building a SaaS

Introduction

There's a lot of talk about how SaaS is the future, and I agree with that. If you're looking to start a side hustle or even a full-time business, you should definitely consider building a SaaS! In this guide, I'm going to show you why SaaS is such an exciting domain, how to get started building one, what kind of things work well in this space (and what doesn't), and some great ways to validate your idea before investing time and money into it. Let's get started!

Why to build a SaaS

Building a SaaS is an easy way to get users, funding and a job.

You want to build a product that solves a problem. You can do this with apps and websites, but SaaS is especially suited for this. You don't have to worry about hosting or maintenance because the customer will pay you for it.

It's also an easy way to get users because all you need is one person on your team who knows how to talk about your product with potential customers and convince them that they should use it (more on this later).

And finally, building a SaaS can be an easy way to get funding if you've already built some traction (more on this later).

How to get started

If you're building a SaaS, there are a few things that you should keep in mind as you get started. The first is how to get your first customers. This isn't as hard as it sounds, but it does require some work on your part. You'll want to be proactive and reach out to people with whom you think your product would be useful or beneficial in some way. Don't just send them an email asking if they'd like your product—do some research beforehand and figure out what their needs are, then come up with ways that your service could address those needs.

Once you've got a customer base established, it's time to build a minimum viable product (MVP). This is just an early version of the full-featured SaaS that will eventually be built; its purpose is simply to demonstrate enough value so that customers are willing to pay for more features later on down the line when they're released (the concept of building an MVP before launching any sort of finished product has been popularized by Eric Ries' book The Lean Startup). Don't worry about making this perfect yet; just create something basic enough so people can see how it works and give feedback based on their experiences using it. If possible, involve users who aren't part of the development team here so they can give suggestions based on how easy/hard it was for them versus someone who knows what they're doing already!

What should you build

There are three main types of products you can build:

  • Product: This is the most common type of product, and it’s simply a good idea that solves a problem for someone. For example, Buffer is a social media scheduling tool for marketers.

  • Service: These are services that provide value to customers through offline interactions and/or human-to-human communication. For example, if you have a great idea for how to get more people onto your website, but they won’t buy anything or sign up without talking to someone—that could be considered a service!

  • Platform: A platform is an online platform or software as a service (SaaS) that requires users to interact with each other in order to deliver value (similar to platforms like Facebook). For example, Uber connects drivers with riders who request rides via their mobile phones; Airbnb helps people rent out their homes when they're not using them; Instagram allows users to share photos on their social accounts; Slack helps teams communicate effectively by providing messaging tools and file sharing capabilities within one application.

Validation ideas

Validation is the process of testing your idea, so it's important to make sure you're doing it correctly. Here are some validation ideas:

  • Get customers- this can be done through social media ads, cold calling and emailing people who could use your product if it existed.

  • Get feedback from early users- get feedback on your product by showing it to them and asking them what they think about it. You can also do surveys or studies using tools like SurveyMonkey or Google Forms.

  • Get users- get data from paying customers that helps you improve the product by tracking usage metrics like churn rate and revenue per user (RPU). You might also want to look into A/B testing new features before implementing them across all customers because some features will work better than others depending on how they're used in practice rather than in theory alone.* Funding is usually one of the biggest challenges when building a SaaS startup since investors tend not like high risk ventures such as these so we'll cover funding later on in this section since there's no point worrying about money until after everything else has been figured out first.* One last thing: remember that while these things may seem simple at first glance there's actually quite a bit going on behind each decision which makes each step much more complicated than just following one path instead of another -- but don't worry! We've got plenty more tricks up our sleeves when we come back around again later!

Bootstrapping, co-founders and investors

If you're bootstrapping your SaaS, it's a great way to learn. You can't hide from the market and have to take risks that you wouldn't otherwise. Building a product is much more difficult if you don't have financial resources to compensate for mistakes or test new ideas.

"If you're bootstrapping, it's so critical that you make the first version of your product as perfect as possible," says [Mike Volpe](https://twitter.com/mvolpe). "Because once it's out there, it's out there."

When considering co-founders and investors, think about how they will add value beyond just money: offer advice on strategy; provide industry expertise; help build relationships with customers or partners; bring in more talent...

SaaS are great to build as a side hustle.

SaaS are great to build as a side hustle.

  • SaaS are great for bootstrapping. You don't need much money and you can use the revenue from your first customers to fund your second and third customers. This way, there is no need to raise capital at the beginning of your business's life cycle (which can be difficult and time consuming).

  • SaaS are also a good fit for investors: they like companies that have recurring revenue streams and high margins, which SaaS deliver in spades!

  • Running a software company with co-founders can be easier on relationships than many other businesses (as long as everyone plays their part). If you choose wisely, you'll have someone who shares your vision, has complementary skillsets, knows how hard it is going to be (and therefore won't bail when things get tough), will make decisions quickly when needed (this helps avoid "analysis paralysis"), etc., so that both parties' needs will be met over time by working together rather than working against each other.

  • Learning how products are built is important; this gives insight into what works or doesn't work well before spending money on development efforts where possible instead of blindly trying stuff out until something sticks (which often costs more overall)!"

Conclusion

As you can see, there is a lot of room for creativity in this space. If you want to build something but are struggling for an idea, it’s worth taking a look at some of the existing tools out there to get inspiration.

Now that you’ve made it through this monster guide, I hope you have a better understanding of what makes SaaS different from E-commerce or Blogging. If you still have questions, feel free to reach out and ask me on Twitter!

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