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Ask HN: What's it like to build Saas business?

8 pointsby selmatover 8 years ago
Recently I had discussion with my 3rd party business partner about idea to build SaaS application suite for SMB. I started digging about everything - feasibility, technical options, requirements, limitations, business models, payment models, etc.<p>I have found blogpost : https:&#x2F;&#x2F;www.saastr.com&#x2F;if-youre-going-to-do-a-saas-start-up-you-have-to-give-it-24-months&#x2F;<p>I am wondering what are your real world experience? How long it take to build MVP, functional product, get into green numbers? What about further customer support, bug-fixes, security, SLA? Is it worth to spend so much time and effort if i don&#x27;t have huge savings to focus only on this thing? Especially if my expertise is somewhere else and don&#x27;t have real-world experience with SaaS operation? (Too much questions in one paragraph)

2 comments

patio11over 8 years ago
I ran two SaaS companies through sale (small-scale both times), consulted in ~20, and spend way too much time talking to other SaaSy folks. Know that you&#x27;re asking a how-long-is-a-piece-of-string question, because the answers here vary <i>tremendously</i> if you&#x27;re building a small one-man operation versus building e.g. the next Salesforce.<p>MVP: The purpose of an MVP is collecting signals of interest that, if you had a better software product available along the forecast vector, people would pay money. MVPs can be as simple as mockups or a few sentences of description if people in your audience already trust you. If you want something which demonstrates core functionality, that can be done in a day to a few weeks.<p>Functional product: You can reasonably ship code people will pay for in 2~6 weeks on the short end; a lot of people spend much, much longer, either because they&#x27;re doing it part time, because their product is inherently complicated (e.g. infrastructure), or because (most commonly) they waited too long to ship.<p>&quot;Getting into the green&quot;: Welcome to running a business! You now have to start getting precise about ideas like &quot;green.&quot; If you simply mean &quot;product covers its costs&quot;, the cost of running a SaaS app is plausibly under $200 a month, so you can very easily cover the costs by selling it to 5 people before launching it. The more interesting question is &quot;How long does it take to get to ~$10k in monthly recurring revenue?&quot;, which is generally enough such that you can devote your fulltime effort to the business going forward. The mean time to that milestone among my friends is ~18 months; the shortest ever was almost $30k at the end of ~4 weeks and I took ~4 years to sustainably hit $10k&#x2F;month myself in one business. (There&#x27;s a story there.)<p>* What about further customer support, bug-fixes, security, SLA*<p>Less trouble than you&#x27;re modeling them as being. Marketing and sales are hard; if you can successfully sell it to people <i>and</i> build it, none of the above are beyond your capabilities.<p><i>Is it worth to spend so much time and effort if i don&#x27;t have huge savings to focus only on this thing?</i><p>I think the plurality of my friends with SaaS companies started them as side ventures w&#x2F;o having sufficient savings to buy their full-time attention from day one. This is less common on the investment seeking track, though they have a pack-it-in-if-we-don&#x27;t-raise-a-seed-round-after-N-weeks built into their model.
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brudgersover 8 years ago
If you have not already looked at it, it&#x27;s probably worth looking at Patio11&#x27;s (Patrick McKenzie&#x27;s) website and reading his blog and listening to his podcasts. <a href="http:&#x2F;&#x2F;www.kalzumeus.com&#x2F;" rel="nofollow">http:&#x2F;&#x2F;www.kalzumeus.com&#x2F;</a>