How to start an online SaaS business in 2020
With more and more people getting involved with aspects of the digital world, and looking to improve their financial situation by starting businesses such as e-commerce, why not look into starting a SaaS online business in 2020?
Welcome to how to build an online SaaS business.
This article is just going to be a brief overview of the steps that you will need to take if you are looking to start your own SaaS business.
Well SaaS stands for software as a service, and is something you charge people to make use of.
So if you are charging people to make use of your online software or product with a license or subscription then that would most likely be a SaaS.
An example of SaaS could be Google Drive, or Zoom.
In other words, you have some software that you make available online and you charge people to use that software.
Now before we dive into the steps of building a SaaS business, Incorporation is worth a quick mention.
All incorporation really is, is officially announcing that you will be doing business and it will give you a legal entity to do business through.
Getting incorporated is actually really simple and pretty cheap depending on how you do it. You can do it yourself for about £12 from the gov.uk website at gov.uk - limited company formation.
Or you can use an accountancy firm to do it for you and manage your accounts for a monthly fee usually between £50 and £150 per month.
Personally I would opt for the accountancy firm because they will save you a lot of time and a lot of headaches.
Now you don’t need to do this right away, but you will need to do it before you start taking any kind of payment so there isn’t a massive rush and you can probably save a bit of money by waiting for the right time.
Now let’s start on the first point which is Ideation.
Firstly, I want to say there seems to be a misconception that your idea needs to be ground breaking and innovative, it doesn’t. It just needs to be a little different than what other businesses are doing. In many cases it can actually be good to do something that is already being done because you know that there is already a market for it.
With that being said, having a new, unique idea is also good, you just need to make sure that the market is there before you spend lots of time and money building anything.
To create a new SaaS idea, you just need to look around you and see problems that people are facing that you are able to create a solution for with software.
Ideally whatever your idea is, you should either have a decent amount of knowledge and experience in the area, know someone who does or have a lot of research backing up your idea.
The second step is where you will want to start planning out your idea and your business around it.
This actually goes for any business, including SaaS businesses and there are two parts that are essential and cannot be skipped, and they are your business plan and your financial plan.
You need to work out and write down, in detail, how your business will work, how it will make money, the time frame in which it will take and the amount of money it will cost to do.
This will include your audience, your USP, and more.
This will all require some amount of research which is well worth spending the time to do it properly.
You may also realise at this stage that you need to get investment, if you can’t fund the business yourself.
Okay now we are going to move onto something more specific to SaaS, you have your idea, and your plan the next is to start designing your software.
For most SaaS products you will need to build a web application which will need to be designed.
If you already have knowledge and experience in web development and design then great, this should be where things get easy for you.
But many people don’t so you may need to look at hiring a designer and developer.
If you have the money it would probably be worth paying for a freelance web designer to design your SaaS product for you.
When it comes to design, I personally like a tool called Figma, it is pretty widely used by web designers across the board for websites and web apps and makes it pretty easy to build good looking sites.
For any developers out there, I know it can be tempting to skip this step, but if you do skip it, you will endup having to re-build your site over and over, so take the time and get the design right first with a professional tool like figma.
This step is where you make your designs come to life.
And again if you have a good amount of experience in web development, then this shouldn’t be too tricky.
If you don’t but you are willing to learn, I suggest you do. It is an amazing skill to learn and is one of the few skills that can turn into a very fruitful career without needing past qualifications or experience.
Unfortunately though it does take time to master and you shouldn’t be expecting to develop an entire SaaS product any time soon if you are just starting.
So instead you will need to hire a freelance or contractor, which is probably going to be the best option for most people who aren’t web developers
Fortunately for me, I started coding and web development about 7 years ago and am in a position where I am able to build SaaS products and best part is, I can essentially do all the steps in this guide for free which is another reason why it is worth learning that is another reason to get into web development.
The next step is analytics, you are going to need to track how users use your website and your product.
You are going to want to do this so that over time you can improve your conversion rate and get more sales, and earn more money.
You will be able to do this by seeing how users use your website and what makes them drop off and leave your website so you can change it over time.
Marketing is a massive subject and can be done in many many ways.
I won’t be going into much detail here, but basically, you need a way to tell people about your product.
You can use Social media, ads, blog posts, videos, comments, emails, phone calls and more.
You will need a strategy that is built around your goals and your audience that works for your SaaS product.
Your entire marketing funnel will run from when a user clicks onto your ad all the way up until they purchase your product.
This means you need to plan how it is going to work.
- Know your audience
- Know where to find your audience.
- Know the pain points of your audience and how to solve them
- Know how to keep filling them with confidence all throughout your funnel.
So now you have your plan, your product, and a way to sell and market it.
The only thing left to do is keep repeating the process to keep improving what you are offering.
Most people building a SaaS product should aim to release an MVP or Minimal viable product to start making money and raise awareness about it asap and then keep building on top of it to make it better and better.
Okay so there are all the steps to take to start an online SaaS business in 2020!
A couple of small notes, if you have some knowledgeable friends or family in this area, then try to create a team. It is always much better and much easier when you have a team of people all working for the same goal each with different talents. Especially when there is more work than one person can do.
And I feel that this is a great example of why digital skills such as web design, development and digital marketing are so important.
All of these skills you can learn for free online and not only can they give you amazing careers, but they also enable you to build businesses for little to no money.