What is Software as a Service?

Nasa ·

Software as a service (SaaS) has become an integral part of the software ecosystem, one that’s grown over the last decade to become one of the fastest growing segments in enterprise technology.

Since 2009, SaaS has doubled in market capitalization every two years, with a staggering $170 billion market.

Over the next decade, experts predict, SaaS revenue will exceed $400 billion annually, while, by 2018, enterprises will spend over $220 billion on software and services, up from $158 billion in 2012.

Alongside the impressive rise of SaaS has been a significant growth in the number of startups seeking funding in the sector. According to a recent study conducted by Chase Lake, Inc., the number of startups securing funding from the venture capital (VC) industry has risen five-fold since 2009, from 800 in 2009 to 16,000 in 2014.

In fact, at least $14.7 billion has been invested into 1,622 SaaS startups in 2014.

So what exactly are startups looking for when looking to launch their own SaaS solutions? Is it money and investment capital, the perfect combination of technology, and an innovative new idea? Or is it more about finding something that feels right, given the characteristics of a SaaS platform?

Of course, that answer isn’t binary. It depends on the specific needs of each specific startup, and what kind of experience they’re looking for in a SaaS product.

But if you ask me, there are a few attributes that are top of the list for every successful startup looking to deploy a SaaS solution, according to Neil Silverman, chief product officer at Invoca, a voice marketing platform.

First, to get the most out of a SaaS solution, you need to be able to use it as seamlessly as possible. Most SaaS offerings out there today use an admin interface as a means of offering support, and there’s absolutely nothing wrong with that. It’s all about using the product to its full potential, however.

“My approach to starting any business is that of extreme simplicity,” says Silverman. “In a world of complexity, the simplest solution is always the best solution. The simpler your solution, the more naturally you adapt to it.”

Second, you need to have a really strong idea about how the product you’re creating will make your customers money.

“Think of how much time you spend on the tools that you use,” says Silverman. “For instance, how many tools have you registered in your Google Drive, how many applications have you opened in your browser?”

“If you can get your hands on a tool, it’s usually because you want to make some money off of it, and it’s usually the time and effort you want to spend on something that will make you money,” he continues.

“If you could purchase a tool for a small amount of money, and make the most of it, you’re more likely to do that.”

And finally, you need to be committed. The most successful SaaS startups spend huge amounts of time developing their product, and making sure that it really solves problems and meets the needs of their users.

“If you don’t put your money where your mouth is, you’re not going to be successful,” says Silverman. “It’s important that if you’re building a SaaS solution, you’re not working on it only when you’re bored, and it’s not something that you would like to talk about it with your friends.”

So if you’re planning to launch your own SaaS product, and you’re looking for advice on how to be successful, perhaps you should focus on these four important criteria, rather than any of the other elements that SaaS vendors have to offer.


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