I have been in business for a year but I can not reach a level it can support myself
I started a SaaS business official in May 2019. (Although I spent about 8 months developing the application). I didn't officially acquire my first customer until May 2019. Fast forward to May 2020, and I've got about 8 paying customers. I'm really proud and impressed by this accomplishment. I still have my full time software engineering job, but I also run my SaaS business on the side. My dream is, of course, to have the business support myself. This requires a yearly revenue number of ~$250,000 to able to actually replace my current full time job.
Growth is, however, slow. I have a good understanding of who my target customer is now, 1 year later, after talking to them and noticing common patterns in terms of their needs.
This is my first real business. I would really love to hear from someone experienced in building a SaaS business from scratch. Your insight would be appreciated. What should I expect in terms of growth? How fast did businesses grow in the beginning (BaseCamp, for example, Digital Ocean, MailChimp)?
Depends on a lot of factors. How much do you charge Users? How did you acquire those users? What is your business? How much did you spend on users? What is the user profile.
You need to determine is this going to grow or are you stuck and hitting a dead end.
I don’t remember where I read or heard this, but I’m pretty sure it is from one of the big famous SaaS guys. “If you can get 10 paying customers then you have something”. If someone is willing to pay for it more people will but is it worth it? You need to review your customers and business to figure that out.
Why do u need to give up? If you have paying customers, and they are using your app without problems, you can update it slowly at your pace.
I started my Shopify app at 2016. It has less than 100 customers. Even I don't invest in development time. The users can use it. I can just work on customer support. Occasionally, I will deploy some fixes. The app can be put to auto pilot when I am busy at other tasks.
One thing I’ve heard over and over is that SaaS businesses take years to ramp up. My friend started his four years ago and is only now at the stage where he can stop his other work - and that’s with deep knowledge of his target market and lots of industry connections.
The real question is : do you want to keep it as a side business or do you want to take the risk to launch a "real startup" (quick growth and scalable)? That won't be possible by keeping your day-to-day job. When launching, the only important matter regarding a startup is execution.
Question asked by
June 5, 2020, 1:45:26 PM
Related Picture Note Cards
The process for a process to gain access to market
A product must gain access to a market and then bought by a customer who is comparison shopping in a safe place. The market validate the quality and safety of the product.
Steps to turn an idea into a product innovation
What are the steps to turn an idea into an innovation? there are at least the following steps. The idea must be turned into a product, and the product must enter the market. In the market, the target audience will examine the artifact - if they buy, then the product becomes a merchandise.
Startup failures - why they fail?
A first time entrepreneur always under estimate the difficulties. Each voyage is a ship with 2000 holes - each hole is only visible when the boat is in water.
Related Quote Cards
Startup Lingos To The Point
How to turn an interest into a money maker. How to attract people, how to stimulate people to pay, how to make profit, how to make relations, how to keep relations.
How much do I have to give my audience so they can pay me something in return? What do they value? what problem do they search for answers on your own? I want to solve that problem.
Brand means name recognition. A lot of people knows what your company does and what you stand for. Brand is result of long campaign of consistent value provision and media cultivation. Brand helps a company reduce marketing cost.
Whether there are buyer willing to pay or not. For that to happen you must provide extreme value. The entire startup process would be based on guess before the validation. Validation happens in a market, not on the street.
Value is what you give customers beyond the price you charge. Value is effective solution to a problem. The price your customer pays reflects whether the problem is big for them and whether your solution is uniquely effective. Value stems from quality and detailed work.
Marketing means bring your product to the market and bring your message to your customer. Marketing is not salesmanship. Marketing is to penetrate the world of commerce through many barriers and existing networks.
Minimally viable business, or MVC, minimally viable company. A company that scrapes by, full of guess and hope and no traction and sales. When you give your customers things for free they all take it. But they never pay and you can never rent a table at the market.
Minimal viable product. A full artifact of a real product. Something that works ALL THE TIME. You can demonstrate the real effect on real people - not to sell hope. The MVP may not have certain non-essential bells and whistles, but it needs to have appeal value.
Customer is king
A business lives at the mercy of its customers. You provide your customers 10 dollars worth of value and they pay you 1 dollar, not knowing that your company only costs 99 cents to provide the item. The value is not the item - the value is what is attached to the item.
Company culture is based on a company making money. Once your workers are paid, they need to have a mission and aspiration so they are not bored everyday and make trouble in the work place.
A company valuation is cash investment divided by the percentage. As long as your story is good, the valuation will keep coming, and the investors will keeping falling into the line.
Return on investment
Investors are either behind family fortune (never work with them) or for rich clients as investment vehicle. Both need returns 2-3 times better than stock market darlings.
Having found what people want, not just what people may need. Your offering and their acceptance is sure, no longer a guess. You can provide it for profit, and you can indeed making living on it. Traction is sometimes called validation. You are no longer a theater. You have touched nature, and found cash vein.