Building your SaaS is the easy part
We all dream of building a nice SaaS or website or some tool that will generate recurring revenue with little maintenance. I know I have this dream and maybe one day I will even manage to make it happen, but for now it is only that, a dream. And not because I haven’t tried, but because building the SaaS is the easy part. Convincing people to use it takes more work and a completely different skillset, skills that most software developers don’t have and will need to be trained and learned.
I decided to share my experience, the lessons I’ve learned and the mistakes I made. hopefully they will be useful for you as well. Now, I don’t want to discourage you, quite the contrary, I just want to make sure that when you embark on the journey of building your very own SaaS, you have as much information as possible related to what lies ahead.
A few stories
Assuming you are like me, you don’t have millions of dollars to spend on infrastructure, marketing and teams that handle all the work. You will have to do everything by yourself, and as efficiently as possible from both a cost and performance point of view. Furthermore, you don’t know all the tech stacks in the world, so you will have to work with what you already know. Here are few attempts (not all).
One of the first SaaS that I tried to build was a service to check if a website is up or not, similar to Pingdom or OnlineOrNot. I was 80% done with the coding when I realized that I could never compete with any of the mentioned services. There was no feature that I could add that did not already exist and I could not even compete on cost, since having datacenters distributed so that I covered all scenarios was costly. The costs could be easily covered with a few corporate clients, but where was I going to get those. It wasn’t even a matter of having the best solution or a product that does not exist yet (Facebook succeeded even though MySpace already existed and had success). So, I abandoned it!
For my next attempt I decided to focus on something smaller. To be more precise, on small business that can’t afford to invest a lot of money on IT solutions. I build a SaaS to track customers’ purchases and rewards. Royalty cards are quite popular, people love to get rewards for their purchases and most big shops have their own royalty card. Small business can’t afford such a system, so I decided to make a SaaS for them. I had all planned out, uses cases, advantages, benefits for both shops and customers and a robust system build on a modern and robust tech stack.
I coded the SaaS, deployed it (more on that later) and… nothing.
Emails don’t work
For my royalty SaaS I really though I have a winner. Customers could have just one royalty card that could be used with all shops in the system, and even have a digital one on their phone. Small shops (think of coffee shops, small bistros, local restaurants, barber shops and so on) will have an easy way of tracking royal customers and rewards. Furthermore, they have access to statistics related to the rewards, number of royalty points offered and more, all for less than 20$/month. I even had a promotion where there were no costs for the first few months and 250 free customizable cards printed on high-quality plastic that each shop could offer for their customers.
Gathered contact information from more than 100 local business, wrote an email where I presented all the benefits, details and launch promotion and sent it to each business individually. I had less than 10% open rate for the email and even where it was opened, it was ignored. It was clear that I had to change tactics so, I started to call them.
I got a few rejections right from the start with different reasons: “We can’t afford to offer special benefits or free products to our customers”, “We tried in the past to have a royalty program and we did not see any increase in sales”, “We simply don’t want to offer any rewards for our customers”. I had a few business that were going through some changes and said that I should come back in 2-3 months. Most of them, however, said that it looks interesting and that they will look into it and come back to me. None called back and even if I did, it was either a “did not have time yet” or, worst of all, did not answer again.
After 4 months of this I was forced to admit defeat and shut everything down. Infrastructure costs money and I had 0 clients.
Deploying your SaaS takes longer than you think
One aspect that I did not expect to take as long as it did was setting up all the infrastructure properly. Maybe if I would have went with Azure or AWS things would have been easier, but as I said, I had a limited budget and wanted it stretched for as long as I could, without sacrificing performance or features. Furthermore, I did not want to be tied to a provider or to do risky migration if the service took of. So I went with VPS instead. This meant that I had to do the Ops and DevOps parts as well, not just coding the SaaS. If I were to split the time spent, I would say that 1/3 was for the actual coding, 1/3 for emails and calls, and the remaining 1/3 or properly setting up the service.
And I don’t mean just deploying the app, but creating a build pipeline that deploys the new binaries, backup system, email service for both automatic emails from within the app and my inbox as an admin, securing my VPS and so on. I was expecting even from the start that a lot of work is needed here and, when I had my next attempt at a SaaS, things moved a lot faster, however there were many unknowns on my side when I first started. If it is the first time you are doing this, expect the same.
What benefits are you offering your clients?
We finally reach my latest attempt at launching a SaaS. For the ones from the past I though that my business model was to blame. Nobody will pay you money when you are new, have no connections and no track record. Yes, I did offer free trial periods, but they would still be tied to me after that. These, along with the current state of the job market in IT, pushed me to build another SaaS, one for which I did not even have profit as a goal, at least for now. I saw many fellow developers that are struggling to find a job at the moment even though there are many job openings. I saw that finding a suitable job, especially with the push of return-to-office, became a bit more complicated and LinkedIn (the most popular job haunting platform) does not have all the fields needed to search for the best suitable job for you. So, I made my own job posting platform, which you can find at https://alpharemote.work
Right from the start I wanted to make it simple to use, have good filtering and search options, as little bloatware as possible and provide job seekers all the information needed. Furthermore, I did not want to make a recruiting agency, just a simple job board that connects recruiters to potential candidates. Everything for free. Recruiters could post jobs for free, view candidates, download CVs and track the recruiting process. Job seekers can register, upload a CV, search jobs and even see salary range, something that I know is crucial information for many.
I saw no disadvantages for recruiters. Why wouldn’t you want more exposure for your jobs? I know I could never compete with LinkedIn in terms of user-base, but I wasn’t even trying. I also implemented a verification system to make sure that only real recruiters are allowed to post jobs. CVs are scanned for viruses. Posting a job takes only a couple of minutes. With the platform up and running, I started to contact recruiters. I have many in my LinkedIn contacts.
After almost two weeks (at the time of this writing), I go back a whole range of answers and questions. Some are not interested in using anything other than LinkedIn. Some, even though said that my platform looks interesting, never even registered. From those that did register, about 20% did not activate their account after that. From those that did activate the account, less than 10% applied to become a recruiter so they can post jobs.
I was in calls with the entire HR staff from a few companies, on their request, to explain further what my platform’s goals are and what benefits can I offer them. And this is the part where I almost froze. I was expecting that extra exposure for their open passions was enough, but it seems I was wrong. People want more than that and I can’t provide anything. I don’t have a huge database of CVs that I can offer recruiters. And I can’t get CVs without jobs for which users to apply. It is a chicken and the egg problem where I can’t get recruiters to post jobs without users searching for jobs, but I can’t get users searching for jobs if I don’t have jobs that can be searched.
So, I was stuck in trying to find some advantage or feature that I could offer to recruiters. Nothing came to mind except for extra exposure. On the bright side, I do have a few people that said that they will do a trial-run and post a few jobs. I just hope that it is not like with the royalty platform where even those that were interested never called back.
Conclusions
Building your SaaS is not hard. There are many really good developers, better than me actually, that are more than capable of building a SaaS, a tool or a platform that could benefit people and even provide more useful features than what I came up with. Deploying it and setting up the infrastructure, while a bit more complicated for me since I am a developer and not DevOps, is not that hard either. The biggest problem is convincing people to use it. Even when it comes to something completely free it takes a lot of effort in convincing people to use it. And when you are either a small team or a single developer with very limited resources, you can’t spend hundreds of thousands of dollars on marketing and adds. You can’t spend 2 or 3 years into building a platform soo good that it can compete with giants like Microsoft, Google or Amazon, if that is even possible.
Building your own SaaS is simple. Launching a successful one is the hard part. Can it be done? Obviously! There are many success stories. I just want you to be aware that for every success story that you hear, there are 100 or even more failed attempts, unreleased projects or developers that have great ideas, but don’t have the skills or knowledge to market it properly. I don’t want to discourage you! Quite the contrary! It is a call to allow your projects to fail when it is obvious that they won’t succeed and to focus on the next one. Maybe, with a bit of luck, your next project will be the right one!
Featured image photo by Sora Shimazaki
