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10 Ways to fail as a SaaS Company

We recently received an interesting white paper detailing 10 ways to fail as a SaaS company. Everyone here at SaaS Lounge enjoyed the read so we decided to share it here. The 10 points are listed below, remember to consider these when thinking about your SaaS start up.

1. Provide your licensed software in a hosted delivery model.

2. Don't test your market

  • As time goes by it's becoming harder and harder to bring something new to the ever expanding technology market. When you have your new idea don't hide it away in fear of someone stealing it and using it for themselves. 99% of SaaS does not and never will bring forth new technology, what you are selling is a service and should be treated as one. Get it out there and see what happens, you might be pleasantly surprised. 

3. Ignore business operations

4. Ignore architecture, services, environments and/or reliability

  • SaaS product planning is not software development as usual. You need to know the pitfalls and getting it wrong can be very costly. Get help. Do proof of concept runs. Don’t stumble about in the dark trying to deliver a  product. You will find out too late if you are wrong and need to re-architect the product. 

5. Ignore end users 

  • It sounds so simple but it will surprise you how many people ignore the feedback of their end users. The end user (your target audience) should be the only people who really know what they want in your SaaS application. Why ignore the most valuable of all feedback? The end user is constantly using the app and is always on hand to suggest new improvements, it would be more than stupid to ignore their requests.  

6. Plan a yearly release cycle in conjunction with industry trade shows

  • Standards set by industry leaders like Salesforce, Amazon, and Google - SaaS users expect a steady drip of improvements that have no set schedule. If the application is correctly maintained, the update will go ahead smoothly without any altercations. As the end user is technically outsourcing there needs to the service provider they are not too fussed about the update procedure and how it is done, assuming of course there are no disruptions to the business. Logging into to a SaaS application to find new features have been added will only have a positive effect on your customers, especially if the update fixes an issue or bug bear that they had. 

7. Provide customised versions and features for specific customers

  • When you start branching development work it becomes harder to keep track of changes made to all of the different branches, add that with the possibility of future changes not working with some of the customisation done for separate customers and you have a problem. The best way to get around these issues is to offer a customisable SaaS Application from which the users can change certain aspects of the software to meet their needs without altering the base application.
  • Another way to get around this issue is to implement an API for third party integration. For example, KashFlow does not support different account permission levels for individual users but through the use of the KashFlow API, KashGuard has created this service without KashFlow having to make any changes to their core application. 

8. Start with a free version to test the market

  • Although this may seem like a good idea at first but think about it. If you offer your service for free straight away you're going to be registering "hanger-ons" who are only there because it is free and usually have no intention of registering once the service becomes paid for. It's worth mentioning that the initial assumption of worth for your service is equal to what you charge. Charging nothing will get you passers by and little else. 
  • Get around this issue by offering a free trial for a limited period to let users get a feel for what you offer without the opportunity for them to carry on with the service without paying for it.

9. Build the richest, most complex offering for day one.

  • What's the point of building everything you have to offer into your SaaS application in your first release? How are you going to keep customers when others around you are constantly upgrading their systems? A steady upgrade system is vital to keep existing customers hooked and it also shows potential customers what you are like as a SaaS provider.  
  • We all know that the more complex an application is the harder it becomes to scale and upgrade. Trying to build new features around an already complicated infrastructure can be a pain and will cause unnecessary problems for you and your development team.

10. Ignore change and agility 

  • Taking all of these points into account you will find that a SaaS company's success will be based on how well they adapt to market changes. Good SaaS applications will be able to scale with ease and adapt to the constant changes going on around them. If your application is able to do this, there is a good chance you'll be on your way to a successful business.  
 
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