How to build a SaaS company for dummies.
Starting a SaaS business is all the rage these days as tech founders are veering away from the sexy consumer tech startups with zero revenue, and finding a safe space in an industry familiar with profit.
Indeed, if you can crack it, SaaS is a phenomenal experience — high profit margins, steady growth, all with the cadence and excitement of an average software company.
It’s a big part of why we’ve structured ContentFly as a subscription model.
The recurring, reliable revenue lets you plan for the future, and the funnel makes it very easy to optimize and improve. In short, we ❤ SaaS and we want more people building SaaS businesses that help people solve real problems.
They say the first 10 customers are the hardest. Once you have 10 customers paying you real, tangible revenue, that’s a good sign you’ve got a feasible business ahead of you.
We’ve launched a few other products in the past, which follows a specific blueprint. If you follow these steps, one of two things will happen:
- You’ll get 10 customers and validate the model, or
- You won’t get 10 customers and you’ll prove the model isn’t viable
Simple, right? Let’s get started.
Step 1: Sign up for ProductHunt Ship
Alright, I know what you’re thinking, “hey anonymous ContentFly guy, Ship costs money — isn’t the point here to make money?”
Why yes, clickbait headline visitor, yes it is.
ProductHunt’s Ship feature allows you to create landing pages for “upcoming” products and collect email addresses. That landing page will feature on the ProductHunt homepage, generating a lot of traffic, and getting you emails from interested people.
While it’s a decent way of building an early waiting list, the real opportunity is in validating demand.
If you don’t get at least 10 emails on your first day on Upcoming, that’s in our experience a signal that your idea (in it’s current form/messaging) isn’t appealing.
Alright, got 10–15 emails on day 1? Let’s move forward to Step 2 — if you didn’t, go back to the drawing board and come up with a new idea.
Step 2. Hack together an MMVP
You’ve heard of “Minimum Viable Products”? Well, let me introduce you to the concept of “Minimum Minimum Viable Product” — a product so stupidly simple that if you eliminate even a single part of it, your entire product is useless.
It took us 24 hours to build, and it carried us to over $15,000 in MRR before we built something real.
There are enough tools out there now that you should be able to deliver your service without writing much, if any, code. Nail down the basic value proposition of your idea, find the simplest way to deliver it (it could literally be a form which emails you requests, which you manually deliver).
The most important part? Charge for it. Charge real money for it — I’m not talking $5, $10. If you don’t have customers willing to pay you $50 for your service, even your crappy prototype version of the service, your service isn’t worth it.
The goal here is 10 people to sign up for $50/mo. That’s a nifty $500 MRR. If you can’t do that without a ton of effort, your idea sucks, and it’s time to try something new.
Step 3. Grow to 10 customers
OK, I realize I’m being cheeky here, but if you’ve done the first 2 steps - built a nifty MMVP and gotten some validation from PH, now it’s just a question of getting eyes on your product.
Here are the best ways to do it:
- BetaList: Hands down, the best place to share your prototype. Pay the $125 expedite fee — it’s worth it. If BetaList doesn’t bring you at least 3–5 customers, it’s time to go back to Step 1.
- Reddit: Reddit is highly community driven, so you can’t just slap advertising on there. However, find a subreddit with your target customer, and either direct message them or post a community-friendly topic to sell. For instance, when we built a leadgen tool, we did the following in r/marketing:“Hey r/marketing — I built a tool that can generate leads for half the cost of AnyLeadz. Would love to try it out for you … let’s say $5 for 50 leads? Anyone interested?
- Hacker News/Indiehackers/Growthhackers/Facebook Groups: Here’s the final touch to round it out. BetaList + Reddit should get you to at least 6 or 7 customers… posting on these groups should get you the next 3. Our favourite Facebook group is SaaS Product Launches.
Live long and prosper
OK, so now you’re probably thinking, “that’s it? I took the time to click for this?”
Look, it’s not rocket science — yet when we started, everywhere we looked for advice on the first 10, it was a mix of “cold emailing” and “content marketing” and “PPC” and a whole bunch of other growth channels which you don’t need until you have at least 50 customers.
(I realize I’m shooting myself in the foot here, since ContentFly is for people who want content marketing, but I’ve got my principles damnit).
If your idea doesn’t suck, these 3 steps will get you to 10 paying customers, and a good PH launch will get you to at least 50–100. The rest, as they say, is history (and raising an unnecessary amount of money because Silicon Valley).