SaaS has been making large inroads into day-to-day life for the consumer, with apps like Zoom and Slack coming to characterize our work from home experiences. But there’s also a significant market for business-to-business (B2B) SaaS solutions. The fundamental building blocks of what software as a service is can help businesses thrive without spending money to develop tools themselves.
For this reason, SaaS can be used to optimize growth for startups with affordable, flexible solutions. That being said, the journey toward starting a B2B SaaS company can be relatively perilous, with a lot of competition and many niches to pick from. In this article, we’ll take a look at some of the important things to consider when building your SaaS company.
1. Know your niche
In order to establish a successful B2B SaaS company, businesses must provide a product that is more efficient or accessible than what would have otherwise been an in-house solution for their customers. To that end, it’s important to find a specific problem to solve and solve it better than your competitors. Considering that the SaaS market is growing rapidly in 2021, there is a lot of territory up for grabs. The key, then, is to find your niche.
It’s important to not be too generalized with your product, as that will dilute its marketability. Look to hire experienced developers who can build a targeted solution, as well as marketers who understand the industry. You should expect to pay $60 to $80 an hour in the US for a freelance developer, and this can help your new business save money over hiring full-time staff.
B2B SaaS is certainly a balancing act that doesn’t often succeed, but when it does, you’ll start to attract the right customer profile for your targeted product.
2. Develop an agile business plan
New SaaS companies are constantly testing their design concepts and products before settling into a specific mix that works. Startups must be able to adapt to the quickly changing needs and overall speed of this faster business model.
This makes it easier to quickly respond to customer feedback and adapt to demand. Just as agile methodologies help us through Covid-19, they can also help businesses work around challenges, which offers new opportunities for growth.
As part of your business plan, you need to consider how your brand is perceived. This means designing your branding materials, managing your social media, and telling your story in a way that makes customers feel comfortable and secure working with you. With agility in mind, don’t be afraid to try out different messages and adapt to the times. But whatever presence you cultivate, it should be consistent across all channels.
3. Network with existing companies
All businesses live and die based on the number of eyes on their product. For a new company, getting the initial push among customers can be difficult and costly in terms of marketing. This can be doubly true for the B2B industry, which is often generally tight-knit and not always open to newcomers.
Finding other companies that target similar niches and creating a co-partnering network with them can help save both time and money. By pooling efforts together and marketing as a group, the success of one equals the success of the other.
That being said, don’t assume that another company will do all your marketing for you – this is a two-way street. This concept might be a bit difficult for new startups in a competitive market, but there are some online networking tactics for business owners to help them develop their collaborative skills and be more assertive.
4. Make adoption easy
When a company is able to integrate your solution seamlessly into their pipeline, that makes it all the more likely they’ll purchase your product. This means user experience is critical, such as having a good web host and interface that makes it easier for customers to find, troubleshoot, and trust your product.
The security of your website is a big part of building this trust, particularly in the B2B world. As a web developer and online marketer Alex Williams of Hosting Data notes, dedicated hosting offers you the best security overall.
“Of course, this is the most complicated and costly hosting option, but also the most powerful, robust, and secure,” says Williams. “Security is extreme in this setup, to safeguard sensitive data stored on the server network site. In one sense, security risks are lower as there are no tethered accounts transferring potentially infected files across the server. On the other, providers take great care to use the most state-of-the-art scanning systems to search for spammers, hackers, and viruses.”
Additionally, you need to teach your customer to succeed with your product by providing them with good training on how to use it. Having some focus on customer relationship development can both help you get great feedback and make it easier for your customer to learn and use your product. You can also build up your online presence with “How to” articles and videos.
5. Focus on market growth, not sales
While a traditional approach would favor a sales-based system of growth, that method doesn’t reflect modern-day standards. Instead, it’s better to focus on market growth as a part of the fundamental building blocks of your product. Instead of sinking all your human hours into sales, you can automate many sales-related functions and dedicate human creativity to innovative marketing.
More specifically, growth should be based on your lead funnel, with onboarding being both intuitive and self-servicing. Focus on conversions through things such as case studies, tutorial videos, and white papers, using a ‘show rather than tell’ methodology.
6. Transition between roles
When first starting out, the founder of a company tends to function as the beating heart. They help drive and motivate, but they’re also usually hands-on with selling and product development. The important thing here is to know when to play what role in the life cycle of a business.
At the start, a founder may be focused on development, both establishing a team and getting the first few iterations of the solution to market. Following that, they will likely step away somewhat from development and focus more on project management. After the validation stage, a founder must then focus on customer care and support, which allows them to directly see how well the product is functioning and if customers are happy with it.
Conclusion
B2B SaaS is growing rapidly, and there are many opportunities to find a niche and excel in it. Study the competition, look at what problems need to be solved, and create a product that can offer a competitive edge.
But the most important thing to remember is that starting a business takes time, especially one focused on B2B Saas. It might take a year or more between starting your business, developing and perfecting your product, looking for funding, and growing your customer base. As a SaaS business owner, make sure you’re ready for the long haul and that you have the patience and tenacity to see it through.
No that you’ve started your SaaS business it’s time to grow it! Find out How to scale a SaaS business here.
