Recipe for an infallible SaaS startup for first-time entrepreneurs

Recipe for an infallible SaaS startup for first-time entrepreneurs

Wednesday December 14, 2016,

6 min Read

I am a firm believer that there are no rules to doing anything. This applies to startups as well.

If there is a recipe laid out for something, it inherently means that it is no longer unique, and creating it is no longer an accomplishment. The same applies to companies. The best ones are unique and unconventional. These are the ones that change the game and scale disproportionately.

This article is not about creating one of those companies. A vast majority of first-time entrepreneurs are not in pursuit of this next big thing. They just want to create a sustainable business. This article is about hacking Software-as-a-Service (SaaS) to create a sustainable business first and then looking into maximising on growth and scale later.

But before you jump in, answer this question -

Do you live in the future?

This seems very fundamental, but this is where I believe a lot of startups fail. Building something that nobody needs.

A huge portion of the risk in your startup is how good a fit you are to identify and solve the problem. It’s important to critically evaluate yourself first.

Do you use the best product for something and feel it can be much better? In other words, do you face the problem yourself?

If yes, then perhaps you live in the future and are qualified to identify and solve future problems. If that is not the case, at the least, you should be exposed to lot of people who face problems where you see a common pattern.

Once you identify it, I suggest the following recipe to play the game.

The integration play

Traditionally, there are two broad approaches to creating new product companies.


  1. Create a whole new breed of product driven by innovation. Something that makes life easier for a wide customer base, i.e., the platform play. A great example here is Slack.


  1. Create a specialised product for a specific vertical, i.e., the niche play. io is a good example where they created a specialised help desk for SaaS/web businesses.

Both the approaches have their own risk/reward equation. But for both the risk vs reward is in balance.

There are, however, new models emerging that lower the risk side significantly, without compromising much on the reward side.

Integration play is one such model that works really well for SaaS businesses.

There are many modern SaaS companies built on similar models; one good example is FullStory, a product that lets you see how users interact with your application, with recorded sessions.

Don’t build a platform. Augment one (to start with)

This is the crux of the integration play. Don’t build another collaboration app, CRM, help desk, or marketing automation product. Rather, build something that augments one and try to fill the gap that you see.

Identify one feature/dimension that isn’t generally offered by most products in the category, but something that a decent fraction of customers would need. Build a product that works alongside the popular platforms products by integrating tightly with them. Your product should feed on the platform and add value to its users.

FullStory, for example, solved a problem that many customer support teams face - understanding and resolving user issues quickly. They integrated with leading help desk systems and provided video recording of the user session for each support ticket.

There are many advantages to the integration play. Most immediate one is perhaps that it cuts short your investment in R&D and allows you to go to market fast.

Go-to-market and strengthening your fit

It’s no secret that an overwhelming majority of startups fail for lack of customers. That’s because, for a vast majority, customer acquisition is an afterthought and not part of the strategy.

The integration play inherently offers you a huge advantage in customer acquisition. It allows you to ride alongside the big platform vendors.

The go-to-market strategy is clearly defined - identify one big vendor with whom your product complements well, partner with them, and be visible to their customer base (marketplace, integration listing, user groups). Clearly illustrate how you add value to their users, on-board them and work towards strengthening your product-market fit.

Note that the product-market fit is not a goal, rather a process where you continuously gather feedback from customers in your primary target (not everyone, mind you) and address their most important issues.

Repeat and reap the co-marketing benefits

When you think you have achieved the minimum viable product-market fit, you can now start partnering with other major platform vendors in the space and reach out to their customers.

This is a major scaling opportunity. With a small quantum of capabilities added to your product, you open up a major new channel for customer acquisition.

Make sure you leverage on all the marketing options available. Get listed on their marketplace, write guest blogs on how you add value to the vendors’ customers and conduct co-webinars wherever feasible.

Optimise organic discoverability

A major factor that determines SaaS success is the discoverability of your product.

As a SaaS entrepreneur, you have got to be obsessed with search engine optimisation (SEO). Visibility on Google makes or breaks SaaS companies.

Here again, the integration play offers some advantages.

By virtue of your partnership and co-marketing with leading vendors, you stand to gain on the SEO front. The links from the high reputation vendor websites add immense value to your website, thus improving your search engine rankings.

Try and maximise the backlinks from each vendor you partner with in the form of marketplace listings and guest blogs. This works like magic and gives you almost instant results.

Expand the scope of your offering

Despite all its advantages, the integration play allows you to grow only so much. There will be a stage when it becomes hard to scale by riding on the big vendors. It’s now time to think of expanding the scope of your offering.

One option at this stage is to start being a platform. There are of course pros and cons to this and it has to be evaluated in your context. While it allows you to offer much higher value (and bump up revenue per account), it now puts you in confrontation mode with other vendors you partnered with. Another option is to find new domains where the same problem you solve may have now become important. FullStory, again for example, expanded their scope to e-commerce after customer support.

By and large, integration play minimises the risks of failure on major aspects - shorten time to market, minimise competition, offer a clear go-to market strategy and enhance visibility to target customers.

Hope this strategy coupled with the ever growing SaaS wave globally helps Indian entrepreneurs create more product success stories.

(Disclaimer: The views and opinions expressed in this article are those of the author and do not necessarily reflect the views of YourStory.)

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