Simple Seven Steps to Build a SaaS Business

Introduction

• Speaker has built and sold three software companies.
• Invested tens of millions in developers and over 60 software companies.
• SaaS model benefits: Recurring revenue as long as customers find value.

Step 1: Start with a Problem

• Identify real customer problems rather than creating ideas in isolation.
• Strategy: Start consulting to learn about gaps in the software market.
• Consider common frustrations, even non-software related.
• Example: Analyze existing processes like spreadsheets in organizations for software opportunities.
• Look for industry trends and emerging technologies (AI, drones, etc.) that create new problems.

Step 2: Build a Prototype

• Create a clickable prototype or wireframe of your idea to visualize the solution.

• Importance of user feedback during this stage to avoid building unwanted features.

• Two main aspects to focus on:

  • Function: Are there APIs and data sources to support the solution?
  • Flow: User experience must be intuitive and straightforward.

• Tools for Prototyping:

  • Pen and Paper
  • Balsamiq (digital wireframes)
  • Figma (interactive prototypes)
  • InVision (pixel-perfect simulation)

Step 3: Validate Your Product

• Validate the solution by getting potential customers to pay for it.
• Use crowdfunding principles: demonstrate the idea and collect money upfront.
• Example strategy: Early Adopter Program with discounts for upfront payment.
• Importance of genuine selling vs. false validation (selling on vision without proof of demand).

Step 4: Build Your MVP (Minimum Viable Product)

• Constrain features to facilitate a quicker launch (3-month timeframe).
• Focus on a basic version that addresses the core pain points.
• Explore upwork to find quality developers for your project.
• Caution against using no-code platforms that may restrict future flexibility or require rewriting code later.

Step 5: Collect Customer Feedback

• Be proactive in gathering and analyzing feedback from users.

• Regularly engage with new customers to understand their experience and challenges.

• Important: Ask the right questions to uncover real needs and opportunities for improvement.

• Three Steps for Customer Feedback:

  1. Collect feedback.
  2. Analyze it for common themes.
  3. Deploy the necessary changes.

Step 6: Generate Demand

• Four Demand Generation Methods:
  • Publish content (SEO, blogs)
  • Paid acquisition (ads)
  • Partnerships (affiliates)
  • Press coverage (media attention)
• Partnerships are often the quickest way to reach the right audience.
• Focus on paying affiliates based on performance rather than offering equity initially.

Step 7: Find a Growth Hack

• A growth hack is an innovative way to acquire customers that others may not be using.
• Examples include:
  • Scraping data from competitors to identify demand (case study with WestJet)
  • Target specific customer segments using existing data.
• Focus on creativity to identify unique opportunities to reach customers efficiently.
• Key Question: "Who has my list, my data, my customers?"

Conclusion

• Emphasis on building a strong foundation and understanding the market before launching a SaaS product.
• The importance of continuous feedback and adaptability for long-term success.