The Software as a Service (SaaS) industry is experiencing rapid growth, offering entrepreneurs a scalable and recurring revenue model. This guide outlines the essential steps to launch a successful SaaS company, emphasizing validation, product development, pricing, marketing, and scaling.
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the SAS industry is booming with
revenues projected to hit over $200
billion by 2025 the future it's in
businesses with reoccurring revenue and
scalable potential AKA SAS companies SAS
stands for software as a service it's a
cloud-based model where users access
software over the internet without
needing to download it the best part
about creating a SAS company is that you
can build the product once and you can
sell it forever it's a very attractive
model for entrepreneurs plus it can be
run remotely you can even run your
business from the Bahamas if you want to
I know that I have way too many
subscriptions to SAS companies because
it's so easy to sign up that I almost
forgot that I did by the end of this
video you will know the steps that you
need to take to launch your own SAS
company and create a reoccurring and
consistent income stream I'm not just
going to show you how to build a
business but also how to validate it
it SAS companies have a unique advantage
in the marketplace with reoccurring
Revenue scalability Global reach so how
do you make sure that there are people
out there willing to spend money on your
product first you need to do market
research the most important part of any
business is making sure that there is a
market for it which means that people
are already spending their money on this
thing the first two questions you must
answer before any other question what
problem is your SAS product solving for
people and who are you solving it for go
on Google and start researching your
competition the market size and gather
all the data that you can about your
industry such as market growth who
spends the most money on your kind of
SAS software and what are the emerging
Trends in the industry you can also use
a really great software called Frederick
AI for this rather than wasting
thousands of dollars building out a
product before you even have a customer
base first build a prototype an easy way
to do this is by building a wireframe
you can draw one with pen and pencil or
you can use programs like balsamic or
figma to make one it is really important
to know what kind of interface design
you want when you start working with
developers so a wireframe is essential
guys this is where your creative genius
gets to come out that's it Patrick your
Genius is showing where now this tip is
going to save you from pouring money
down the drain it is the number one
thing that most businesses get wrong you
need to validate your business idea the
moment someone pays you is the moment
you officially have a business method
one you can start a wait list to get
users to sign up before you build the
app you can incentivize people to share
the weight list by giving them points or
discounts to your software so how can
you create a weight list you can
actually create a weight list with apps
such as weight. Le viral loops and
Shopify forms or you can even use Google
forms if it's easier for you but here's
the best way to validate your idea
create an early adopter program offer
participants a chance to invest in your
software by purchasing a license at a
discount for the first year if done
successfully this will prove that people
don't just like your product they're
willing to pay for it name the program
and provide exclusive benefits such as a
verified status on the platform or
involvement in feature creation remember
even if people say they like the idea if
people don't pay they're unlikely to
spend their money when it's launched I
recently listened to an interview with
Daniel Priestley who at the age of 21
launched his first company it reached
$10 million in Revenue within 3 years he
says the most important part of starting
any company is validating the idea
before spending a lot of money plus this
looks great to investors or future
Partners okay what do you do once your
idea has been validated you can create
something called an MVP what is an MVP
an MVP is a minimum viable product you
can create an MVP with minimal features
to show what your app or software will
be like you can create this using
programs like figma bubble Shopify or
Glide here are a few examples of nvps
that big Brands started with buffer the
social media toolkit for small
businesses first launched with a simple
landing page just explaining the concept
of scheduling social media posts zappier
the tool that integrates all of your web
apps began is a manual process where the
founder literally manually connected
apps behind the scenes crazy I know the
founders of Airbnb listed their own
apartment on a simple website to test if
someone would be willing to pay to stay
in someone else's home so if you're
looking to make a website for your nvp
I've actually linked a free Shopify
trial down below now the much asked
question how should you price your
product here are some potential pricing
models to consider for your SAS product
before you think of your model I would
research what other SAS products in your
space are charging this way you can get
an idea of the market value you also
want to consider if you have any monthly
cost to run your business make sure your
price reflects what you would need in
order to pay off your initial investment
within the next few years or months and
to cover your monthly costs now let's
talk about the different pricing models
first is subscription based pricing this
is where customers pay a reoccurring
monthly or annual fee to get access to
the product companies such as Netflix
Shopify and Spotify all do this very
well the premium model offer a basic
version of the product for free and then
charge for premium features cap cut and
Dropbox both use this model usage based
pricing this is where customers pay
based on how much they actually use the
product stripe uses this model flat rate
pricing customers pay one price to get
access to all of the features notion and
Adobe Express do this per user pricing
you can charge customers based on how
many users there are in their account
slack and zoom use this model there are
many more options but these are all
great as Patrick Campell the founder of
profit well says a great pricing
strategy doesn't just maximize Revenue
it maximizes your customers success the
big question how will your potential
customers find you or even know that you
exist and how are you going to make
money well marketing will will be your
best friend in this process here are my
biggest recommendations when it comes to
marketing and selling your products the
nicest thing about SAS products is that
there is no shipping involved so anybody
in the world can access your products
immediately at any time first partner
with any key people of influence in your
field influencers thought leaders
businesses and groups and give them free
access to your platform in exchange for
them to share it if they like it you can
also use affiliate marketing and give
influencers a percent of each referral
that signs up you want people to
associate your brand with people they
trust and respect plus you're going to
reach a whole new audience this way you
can use chat GPT or Google Gemini to
help you find these people and you can
also use softwares such as LinkedIn
sales Navigator or other email finder
tools like Apollo that help you get the
contact of the exact people you want
lastly Shopify collabs is also a great
place to find Affiliates next run paid
ads chances are a lot of people who need
your product are hanging out on social
media and you could Target them to sell
your product through cgc ugc or just ad
creatives in general to learn more I
actually have a video in the description
about Tik Tok ads and Facebook ads so go
watch those if you need a little extra
help next offer a free trial for new
users so that they can test out your app
and once they love it give you their
money create educational content on
social media focused on your product and
build a community around it make sure to
give as much value as you can next put
good reviews and customer success
stories all over your front page people
Trust reviews you can also add your app
or software to the Shopify app store if
your SAS software serves businesses now
what will you need to create a SAS
product you will need to find a
developer to build out the software and
a UI or ux designer for your interface
you may potentially need a devops
engineer product managers and customer
service Representatives you can actually
find the right people for this on
platforms such as topt who actually have
the top 3% of talent wellfound which is
made for startups or gun.io specifically
made to find software talent for sales
you can hire a sales team on a
percentage basis or you can just do
sales on your own you honestly do not
need a big team to start you may need to
do everything on your own in the
beginning the biggest thing you need is
to Outsource product development you can
also partner with developers to get up
and running but be careful who you give
your Equity to believe it or not you can
actually build SAS softwares with no no
code apps such as bubble Glide or adalo
so go give those ones a try the downside
is that you don't fully own the software
because it is run on their platform so
if something happens to them you may not
have a software anymore here are a few
more AI tools to help you you can build
an app on Firebase you can use maxio for
billing and lastly you can use full
story for Behavioral data what is the
best way to keep customers happy make
sure to provide ongoing customer support
always always keep your software up to
date and iron out any bugs in the system
you want to make sure your product is
actually solving your customer's problem
you will also want to Monitor and
respond to customer feedback the goal is
to keep people on the platform for as
long as you can we always want to be
thinking about the future of our
business you want to make sure that your
processes are scalable so here are some
ways you can scale your business the
whole point of scaling is doing more of
what is working so use something called
the 8020 rule the 8020 rule states that
80% of your results come from 20% of
what you do and 20% of your results come
from 80% of what you do so narrow down
what's actually working for you and do
more of it for example if you're getting
most of your customers from ads put more
money into pushing ads if most of your
revenue is coming from Paid feature
upgrades build more of those for
customers to buy you get the gist here
are a few standard things you can do to
scale once you have customer data refine
your Target customer and retarget them
with ads you can also upsell your
customers solve the problems they face
before during and after using your
products and then charge them for it you
want to expand your market and start
selling to new locations or even adapt
your product to meet the needs of
adjacent Industries you can also build a
sales team around your product or even
automate your current processes another
thing you can do is raise additional
funding to pour into your business but
most importantly pour your money into
the places where money is already
pouring out for you now I want to hear
from you guys what SAS products are you
currently excited about comment them
down below look no one is going to
become an entrepreneur without facing
some challenges these are the common
challenges you will likely face in the
SAS industry but you've got this guys
Rome was not built in a day okay first
is churn rates a churn rate is the
percentage of customers that stop using
your services within a given time frame
turn rate percent equals the total
number of customers lost during a period
of time divided by total number of
customers at the start of the period and
then you times it by 100 you now have
your turn rate percent for example if a
company starts with a th000 customers at
the beginning of the month and loses 50
their turn rate is 5% just so you know
the typical SAS turn rate is 5% so if
customers are running away a little too
fast and you have a higher turn rate
make sure to check in on what might be
causing it and improve those areas you
can also run a survey to ask people why
they left competition there will always
be competitors in the ring but that's
kind of what makes life fun it's a
challenge other competitors May lower
their prices steal your features and
improve on them or even steal your
customers so pay attention to what your
customers are asking for and always keep
your features up to date this way you
can stand out in a saturated Market
let's talk about the future of SAS there
are a lot of new trends in the SAS space
the biggest one we all know of is AI but
there's a lot of other cool products
like data as a service platform as a
service and Market consolidation big
companies are actually acquiring smaller
companies in their space so it could be
a good strategy to build a SAS company
and then sell it to a bigger player
another trend is micro SAS companies
these are operating on a much smaller
scale the last one I will mention is
white label SAS this is where you can
purchase unbranded SAS software and just
put your brand on it anybody can become
a successful entrepreneur it is not the
smartest people in the room who do it
but just the ones who believe even
themselves enough are willing to learn
and take action you now know how to
start a SAS company a little Pro tip
before you go the biggest thing you can
work on as an entrepreneur is your
mindset everything you do stems from
your belief system so make sure you're
feeding your brain with thought food
that fuels your entrepreneurial Journey
it will not be easy you're probably
going to be challenged more than you
ever have been but there's a quote that
I really resonate with being an
entrepreneur means doing the known work
for the unknown outcome you don't know
what your results will be until you try
but the best thing you can do is take
action and do the work you know what you
need to do the other most important
thing is speed make sure you're taking
action quickly ideas can ruminate in our
heads for years and never make it out of
our minds so go get out there and build
a killer sass product I cannot wait to
see what you guys create I'm Chris
mccollins thank you so much for watching
this video if you found this helpful
please let me know in the comments down
below and give this video a like and if
you want to get access to a bunch of
free resources for all things business
just subscribe to our channel for weekly
videos bye guys [Music]
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