Start A Saas Company - Business Ideas

Updated: September 15th, 2022
Start A Saas Company

Please note that the data provided in this article are estimates and may vary depending on various factors, and should not be considered as perfect or definitive.

SaaS (Software as a Service) is software that allows users to access and use it over the internet. It is a subscription-based service that provides users with access to software that they can use for their business. It offers a variety of features, including a project management tool, an automation engine, and a workflow designer.

To start a SaaS company you should be familiar with the SaaS business model and have a good understanding of how to build and market a SaaS product. You should also have strong technical skills and be able to develop a high-quality software product.

Salesforce is one of the best SaaS companies in the world. Salesforce provides an integrated CRM platform that brings companies and customers together. The company is one of the most innovative cloud software solutions providers on the market, generating nearly all its annual recurring revenue from SaaS tools. According to Salesforce's latest financial reports, the company's current revenue (TTM) is $26.49 B.

Starting a SaaS company is a great way to enter the tech industry. This type of company is growing in popularity as more businesses are looking for ways to save money and reduce their IT costs. SaaS companies typically have high margins and offer a lot of flexibility for entrepreneurs.

Starting a saas company requires a great deal of effort, dedication, and most importantly passion.

If you're interested in how to sell saas company service, or selling saas company service online, you can use this page as a guide for everything you'll need to know.

Key Stats

market size
$581B
revenue (monthly)
$413K
starting costs
$11.7K
gross margin
90%
time to build
210 days
growth
Word of mouth
business model
Software
time investment
Full time

Startup Costs

Min Startup Costs Max Startup Costs

Office Space Expenses

$0

$7,000

Employee & Freelancer Expenses

$150

$250

Website Costs

$223

$7,015

Business Formation Fees

$600

$4,700

Software Expenses

$162

$2,894

Advertising & Marketing Costs

$0

$1,400

Total Startup Costs

$1,135

$23,259

Successful Businesses

Business URL Rank

Zoho

zoho.com

171

Lucidchart

lucidchart.com

1,927

Gartner

gartner.com

2,836

System.io

systeme.io/home

3,027

Jasper

jasper.ai

4,074

Webflow

webflow.com

5,013

BrightLocal

brightlocal.com

5,404

Zapier

zapier.com

5,411

Chargebee

chargebee.com

5,611

Paddle

paddle.com

5,629

Duda Website

duda.co

6,665

Pros & Cons

Pros Description

Flexibility

You can put as much time into the business as you'd like. If you like the work and have some initial experience, you can start small and manage all aspects of the business on your own.

Ability to start your business from home

It's not necessary to have a physical storefront or office space to get your business started. You can do everything from the comfort of your own home, at least in the beginning!

Little startup costs required

The cost to start a saas company costs significantly less money than most businesses, ranging anywhere from 62 to 23,259.

Rewarding work

Starting a saas company can be really rewarding work. After all, you are solving an immediate issue for your customer and you're working on something you truly care about.

Scalable

With businesses and processes changing daily, there will always be demand for new features, products and services for your business. Additionally, there are several different business models and pricing tiers you can implement that will allow you to reach all types of customers.

No overhead costs

To get your saas company started, there are no costs associated with overhead, storage, packaging, etc. This will save you a lot of time and money!

Cons Description

Crowded Space

Competition is high when it comes to your saas company, so it's important that you spend a good amount of time analyzing the market and understanding where the demand lies.

Longer Sales Process

A saas company can be a big time and money investment for your customer, so it's important you plan and predict a longer conversion funnel and stay in communication with potential customers.

Work can be inconsistent

As a saas company, the amount of work assigned to you and schedule tends to be more inconsistent, which may make your income less stable. It's important to set boundaries and budget accordingly based on the amount of work you plan to have.

Lack of benefits

With a saas company, you are typically self-employed and responsible for finding your own insurance, which can be quite costly and time-consuming.

Isolation

Often times, as a saas company, you typically work alone and do not have much face-to-face interaction with other team members.

Taxes

As a saas company, you typically pay self-employment taxes which can be quite high. It's important to understand what you will be paying in taxes each year so you can determine if the work you're taking on is worth it.

Marketing Ideas

  • 1

    Affiliate Program

    Affiliate marketing is a great way to bring in a new revenue stream, especially when you don't sell products or services.

    Simply put, an affiliate program is an agreement where a business pays another business or influencer ("the affiliate") a commission for sending traffic and/or sales their way.

    The affiliate typically gets a unique link where clicks and conversions can be tracked.

    Learn more about affiliate program ➜

  • 2

    Direct Sales

    Direct sales strategy implies a direct contact between a seller and a consumer without the involvement of any third party. Direct selling is popular in sectors where sellers communicate with their clientele personally. The sales technique occurs at non-store locations which include at home, work, or online.

    For direct selling to succeed, hire a few (or many) salespeople to support the sales conversion process. It's critical that you assign them specific roles and responsibilities to nurture the client and provide excellent support.

    Learn more about direct sales ➜

  • 3

    Word of mouth

    Word of mouth is when a consumers reflects their interest in a company’s product or service in their daily dialogues.

    Therefore, word of mouth advertising is essentially a free advertising triggered by the customers experience.

    According to Nielsen, 92% of people trust recommendations from friends and family.

    Therefore, in today’s hyper-connected world, a single recommendation through a word of mouth can have a huge impact to your business.

    Learn more about word of mouth ➜