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Ask HN: Profitable SaaS? How did you grow your business?
295 points by hackathonguy on June 20, 2016 | hide | past | favorite | 109 comments
Hey HN guys,

Saw this thread from a couple of days ago about profitable one-person SaaS apps. I'm wondering: how did you grow your business to become profitable? What were your main user acquisition channels?


I have a B2C subscription site for digital nomads called Nomad List (https://nomadlist.com) with about 5,000 paid members.

The main site was always free and that became kind of a lead generation / acquisition funnel to have people sign up and become paid members.

What they pay for is a chat group and forum (and some extra apps I made for digital nomads, like a trip planner on http://NomadTrips.co). The price now is $75/year.

I simply started by adding little features (like a chat), I charged $5 one-time first, because I was getting a lot of spammers. Even with $5, people kept joining. So I kept raising it, to $25, then $50, then $65, and then in April this year I made it annual and recurring. Sign ups have remained the same and even grow.

Meanwhile the main site that's free (https://nomadlist.com) keeps being covered in mainstream press like Time, Times and HuffPo. I don't do any PR or marketing. So my CAC=$0. It also ranks very well in search as it's linked to by so many other sites. Also not actively worked on that, it just happened because people liked my site.

I've tried FB ads last month but only saw 4 conversions.

So I think organic acquisition works best for me. Which means: Make a cool site, add paid features, make it recurring. Win.

This is B2C though, so probably quite different!

That's really cool-- congratulations.

I noticed ads on your site as well. How does ad revenue compare to recurring subscription revenue?

Ads are about 25% of revenue, so pretty small compared to people actually paying.

Mind if I ask what your FB test was like? Most people who "test" on FB don't wait till results are statistically significant, particularly with conversion data. Beyond that, you typically need to test at a loss initially, get data, and then optimize to profitability as you dial in your targeting and test new creative (which you absolutely need to do given how quickly banner blindness sets in on FB).

Also, have you tried paid search? And if you don't already have one I'd consider an affiliate program. Gives bloggers another incentive to write about you, and you have a very "PR-friendly" business concept.

I literally have no idea. I have someone who does it for me. But 4 conversions seems very low. Do you have any experience setting it up? My Twitter is @levelsio

I do this for a living and used to help lead the biddable media group at one of the large search agencies.

I'm not really on Twitter these days, but if you share more info here I might be able to give you a few bits of guidance (or dig for my email in my profile).

I've really enjoyed browsing nomadlist.com- great work. Haven't had a reason to pay- I guess I'm really just looking for inspiration- but I realize it fits a lot of people's needs. I did notice recently that in the signup page, you took away the options to list various details about yourself, such as career, etc, and instead just have username and then paywall. What drove this decision? Is it for building email lists, or does this process drive higher conversion- or something else?


Ahh I think I know what you mean. I switched from a Typeform sign up form to an actual landing page with Stripe. The reason was that Typeform didn't support recurring revenue and I wanted to move there.

I think the only thing I asked more was which industry you worked in. I might add more social profile thingies to Nomad List later so people can get to know each other better though! Thanks for the trip :)

And you're right the paywall should be BEFORE asking people for email etc. It's not a dark pattern (although it seems like it), the problem is if people click "Pay with PayPal", I need to have their email beforehand due to PayPal's stupid IPN API.

JotForm supports recurring payments, both for Stripe and PayPal. Let me know if you need any help.

How do you source the data for your app? Is it all user-generated?

It's now moderated by city editors and users can submit data too on the site.

is this from the 12 startups in 12 months right?

you're my personal hero (ok, tbh I lack a word between "like what you do" and "straight adoration" :D)

Yes it was! It was the 6th one I think! Thanks you're my hero too :D

Thanks for sharing!

Regardless of your market and product, the fundamental equation you need to get right in SaaS is CAC < CLTV, ie your customer acquisition cost needs to be vastly lower than the lifetime value of a customer (= your monthly gross revenue per customer x # of months you'll retain a customer)

The main tip I'd share for getting started is to think about your CAC first, ie before pricing. Set up a simple spreadsheet to conservatively estimate how much money you'll need to spend to get one customer (this will work with any channel, really). If you have some empirical data based on your own experiments, all the better.

That estimated (or empirical) CAC will help you understand much better how much you'll have to charge per month (or year) to recoup your CAC within a reasonable timeframe (depends heavily on whether you're bootstrapping or are funded), and you can base your pricing strategy on that.

Many VCs will look for ratios of 3, ie your CAC needs to be 1/3 of what a customer will pay you over their lifetime. VCs specialized in SaaS will have more sophisticated ways of looking at this, of course, but 3x is a reasonable lower boundary.

I've always found this guide[1] to be tremendously helpful to people looking for a good primer on SaaS business metrics.

Important to remember here is that VC funding is not the path for everyone, and what a VC wants may not always fully align with what a business owner wants. If someone has a small SaaS product where the 3x multiple is lower, perhaps that is ok with them if it still allows them to run it as a lifestyle business. Ultimately these things are flexible (with the exception of CAC < CLTV).

[1] http://www.forentrepreneurs.com/saas-metrics-2/

While this is true, if you're a one-person SaaS company you probably won't factor in your time as a cost. Sales (and some marketing) labor overhead should be factored as a direct cost to acquiring customers.

If you are "profitable" as a one-person company; make sure you are paying yourself a market-rate salary or are at least factoring in your time as a cost. If not, your SaaS acquistion metrics could be way off.

I have never liked this advice. This is an employee mentality, not an entrepreneur mentality.

An employee thinks in terms of salary and hours of work invested.

An entrepreneur thinks in terms of investments and compounding returns over calendar time rather than hours worked. This makes sense because proper compounding returns will always outrun hours worked in the long run.

One thing that's a little unclear for me is how much labor should be factored into CAC in a small team venture where everybody is wearing every hat.

I've done it by doing an all in CAC calculation and then a non-labor calculation and then playing with weighted averages of the two and trying to guesstimate a split. Is there an accepted canonical formula for this?

Labor/salaries should definitely be included in your CAC. The standard way to calculate it is to consider your 'fully loaded' marketing & sales spend in a given period, including salaries, which in smaller teams doing b2b sales will usually actually be the largest single item.

Re: wearing different hats, you should still be able to come up with a % of time spend on actually doing marketing+sales and allocate accordingly.

The main thing to consider is, as your customer acquistion scales, does your headcount/labor cost scale as well? If so, that should be a factor in your CAC calculation.

I don't think there's one canonical formula. But here are David Skok's thoughts:

"To compute the cost to acquire a customer, CAC, you would take your entire cost of sales and marketing over a given period, including salaries and other headcount related expenses, and divide it by the number of customers that you acquired in that period. (In pure web businesses where the headcount doesn’t need to grow as customer acquisition scales, it is also very useful to look customer acquisition costs without the headcount costs.)"

[0] http://www.forentrepreneurs.com/startup-killer/

I launched a free API 4 years ago, and in January 2015 I introduced paid plans, which offered several benefits over the free service.

I have done no actual marketing, but the website ranks somewhat okay in search queries. It keeps growing every month, and recently passed $10k/month in profits. This is from pretty much word of mouth via stackoverflow or from google searches.

From this experience I can say that if your service is competitively priced, good, and needed by a somewhat large audience, even with no marketing you can turn a profit really fast.

Care to share? Since you don't mention the name I guess not, but maybe you simply omitted it out of politeness :)

Based on comment history, I'm guessing it's IP-API [0].

[0] http://ip-api.com/

If that's the case, the author is some sort of marketing genius. There's tons of competition, including Google.

It actually geolocated me incorrectly by 7 miles. Google, on the other hand, knows my location to like 30 meters.

What percentage of your users are monthly active users? What percentage (of the monthly active users) ended up paying? How much do you charge per month? How did you figure out what to charge?

Since there is no authentication done for the free service I can't really track users, but just to give you some numbers, the free API serves over 10 billion HTTP requests/month. An educated guess would be 5% of users ended up paying.

Initially, I just wanted to make the service pay for itself (hosting, dev., data mining costs) and allow me to dedicate some time to provide support to users, so I asked myself, as a dev/company, how much would I pay for this service. I started with €80/year, and doubled the prices a few months later, to €160 (€13/month). The price increase seemed like a good business move, and surprisingly, the number of sales improved as a result.

...ten billion? What the hell servers are you running this on? Is this normal?

A mix of VPS and dedicated servers: 2 in EU, 3 in USA and 1 in Asia. Highly optimized stack.

Some live stats http://ip-api.com/docs/statistics

Mind talking a little more about your stack? This is very interesting.

If you were to use azure table storage and use shared access tokens for authorizing access to query results, you could run the whole thing from any individual data center for under $500/month.

Assumption is that every IP (all 4.3 billion) had about 100 bytes of data stored about them. That is ~430gb of storage runs you $30/month. The 10 billion queries to that storage costs about $360/month. ($.0036 per 100,000 transactions)

Looks like the service is an IP lookup API. The sort of thing that many sites will hit once for each visitor. Most SaaS sites will never get anywhere near this, but things that do per-user or per-pageview queries (e.g. usage analytics) can get to billions of events per month with, say, 10k customers doing 1M hits each.

That's roughly 4k qps. Assuming it's a lightweight API a single server isn't out of the question. Nginx will handle 20k qps until the end of time on a tiny box serving static content.

Who is your target group and where do they hang out online?

In B2C, the fun starts once you're beyond the obvious choices. Let's say you're in the fitness for women market. The obvious channels would be fitness-related forums or blogs. They are also easy to copy and that's where everybody else tries to place their products.

In addition to these channels, try to think of situations in your customers lives that lead to choosing your product eventually. Maybe that'd be people who just became vegan. Or women who rethink their birth-control. Or people who just ended their relationship or started a new one. These are situations where people are also open to re-think other choices in their lives and a fitness program for new vegans might fit their needs perfectly and chances are that you're the first one to piggyback on this specific channel.

The next step would be to identify available resources in that area and create marketing material that fits those channels perfectly. Obviously, you should deliver value with your stuff to the people who frequent this channel and not just dump your product name everywhere.

When you're just starting out, a low customer acquisition cost, preferably zero, and organic growth is key. A site like HN or Product Hunt may drive a one-time spike in traffic, but people Googling for a solution will drive new customers day after day, month after month, if you're actually solving a real problem. Don't worry about SEO too much, but I will say that the more specific your solution is the better you're likely to do. If you're simply introducing the 57th generic time tracking solution, you're going to have a though time. Time tracking for dentists (caveat: I have no idea if there's demand for that)? Now that is a clearly defined customer base, and you can probably think of numerous ways to reach them straight away.

Other things I've found helpful when starting out:

- Is there a subreddit that caters to your ideal customer? Be active and genuinely helpful in that community. Don't spam your SaaS, but if people express a problem that your service solves, tell them about it.

- Is there somewhere your target audience gathers? Think conferences, trade shows, meetup.com, etc.

Remember that being profitable always has two sides to it: You can bring in more revenue, or you can control your costs. Don't be that company with 17 employees, spending $100K to make $9K/mo. Strive to be a WhatsApp, with 55 employees making over a billion a year. If you have the technical chops, validate your SaaS at least to $10K/MRR with just a few persons or even by yourself. Then if you really want, use VC to step on the gas. Because that is what VC is: an accelerant, so be sure you're pointed in the right direction and not at a wall.

I convinced patio11 to tell everybody that Tarsnap was awesome but far too cheap.

Well, sort of. Tarsnap was quite profitable by the time Patrick wrote that blog post; but its growth has always been driven primarily by word of mouth, and blog posts like Patrick's are a large part of that. The only sort of advertising I've found to be useful is sponsoring open source software.

I run a one man B2B SaaS (www.hrpartner.io) and marketing has proven to be a real mystic art for me. I always thought the programming would be the tough bit, and the marketing the easy part, but it has been totally the opposite in my experience.

My biggest issue has been finding the right channel to market. I've tried Facebook and Twitter advertising (on a small scale - about 5 campaigns at $100 a pop) without much result. I've spent over $2K on Google AdWords with limited success.

In all above cases, I got a lot of people visiting my site, with about one in 20 visitors actually signing up. But after that, very few signups stayed around for more than one or two login sessions, and even fewer signed up for paid plans. (We use Intercom to track conversions and activity)

Don't get me wrong, I am not really complaining as I have a steady core of users who seems to use the app regularly, but I am mystified at the very low rate of converting visitor and initial account creators into regular users.

Next step is to look at specific review sites such as GetApp and Capterra. Our product also integrated tightly with Xero so we just advertised in the Xero User Magazine this month which will be distributed to thousands of users at their US convention soon, so we will see what comes out of that.

My biggest struggle is that because I am still actively developing and adding new features to the app, I have problems putting down the coding tools and building momentum with marketing.

Oh, and as for pricing, I've got a free forever plan for smaller companies (up to 10 employees), with paid plans after that. Expectation was that smaller companies could onboard for no cost, then as they grew, they would upgrade to a paid plan, but because we have only been live for a few months, still too early to tell if that will be a great strategy. I may drop the free plan later this year.

We also built a totally free companion site (www.staffstatus.io) that integrated with HR Partner and made free to ALL sizes of companies to see if we could get some side business (similar to what crew.co are doing with unsplash.com, but so far it doesn't seem to be doing what we intended - though it is really early days for that too).

Looking forward to keeping an eye on this thread to see what other solo SaaS drivers are doing. Feel free to ask any questions or critique any of my methods.

You're doing a lot of things right but drop the free plan ASAP It's all the support and overhead of free customers with none of the financial upside. I presume you need to start generating proper revenue/profits from this site ASAP. The free plan will hinder that.

Adwords is indeed a waste of time and money, Facebook is too. I spent a lot more than you before I realised that, well done for working out it's a waste much sooner than I did! Bing is probably worth your attention.

Capterra will drive good leads initially but they'll fall off after a while. Keep an eye on your spend there and pull it if the conversions dry up. Get App always had too high a cost of entry for me to try.

Stop thinking the next feature you add to the app will grow your client base. There's a lot of shitty HR apps out there with excellent marketing making more money than you :)

Don't make the mistake of thinking that your app can be used in all countries and so why wouldn't we market to the US (or <insert other country here>)? I'll tell you why - there are a lot of large, incumbent and well funded HR apps in the US that you're going up against and you'll lose every time because you don't understand exactly what the US market want.

If you're based in Australia focus all of your attention in what Australian businesses want to see. You probably also need to decide what size of company gets the most value out of your app and go after them - same for industry vertical(s).

"A person who chases two rabbits catches neither".

Work out what rabbit to chase, stop chasing the others, go after that rabbit with all your marketing might. Shape your products roadmap off the back of what that one rabbit needs for you to capture it. Shape your USP off the back of this too. "ANNOUNCING A BEAUTIFUL, EASY TO USE, WEB BASED HUMAN RESOURCE MANAGEMENT SYSTEM." is far too generic to appeal to any one audience - so guess what, it appeals to nobody.

Source: I run a HR software app called http://www.staffsquared.com. I've been where you are. Good luck!

Would love to know more about why you think AdWords and FB is a waste of time and money. Please don't take this the wrong way, but as someone who has managed many accounts of all sizes (up to the multi-million dollar/year range), often times most accounts just aren't setup very well. Not that I can always blame people as there's always work to do, and things constantly change, but the point stands that you may not be able to dial-in a profitable campaign even after spending $5k depending on what your conversion rates are like.

Just as often, the problem is on the website and not the ads as well. For example--and not meaning to knock you here, but perhaps the cartoony graphics are a turnoff to prospects. I don't know, but testing would find that out (which you may have done).

All of that said, sometimes it does not make sense to focus marketing efforts on paid advertising channels like paid search/social, but you can usually do things profitably at a small scale, even if you're just focusing on smart use of retargeting with RLSA or something like that.

Just to add my two cents worth. The main reason I went with AdWords myself was because I set up a paid Google Apps account to handle the emails etc. for hrpartner.io. As part of that, they sent me an offer for a few hundred bucks off my first campaign as well as a dedicated AdWords account manager for a month.

So I decided to try it out. My account manager was good, but she didn't really understand my business. I learned a lot of cool AdWords tricks, but at the end of the day, the campaign(s) she set up for me were really too generic, and I was getting all the wrong sorts of customers calling/emailing. Things like people were Googling "McDonalds HR Department" and seeing our ad coming up and calling us to complain about their shift!

It made me realise that in order to make Adwords work, I really needed someone who was intimately familiar with the platform AND my business, and who had the time to monitor things closely and make tweaks on almost a daily basis.

I'll hold off for now and spend the money elsewhere (possibly Bing as Simon suggested) and other B2B app and review sites and see how that goes.

Good points well made and no offence taken at all.

In our particular industry there are some large (wealthy) incumbents who bid silly prices for the keywords that convert. It's a race to the bottom, with Google the ultimate winner. Our CAC was infinitely higher than the LTV of paying customers permitted on Adwords as a channel, so we had to ditch it.

We did try the usual things, landing pages with unique copy, split testing ads, split testing landing page copy, negative keywords, retargeting and so on but as the OP discovered just didn't convert. I should add that when I say it didn't convert - what I mean is that we have other channels that convert at a much lower CAC, and so we have doubled down our efforts on those instead :) Google doesn't need any more of my money!

Facebook - We probably could have spent more time and money on before writing it off but again, we have other channels that are working and so didn't feel the need to push on with Facebook.

In your experience does Facebook do well for B2B products like ours?

Can you give a sense of what size budget you tested with and how much data you collected? Tests that are too small to deliver statistically significant results are something I see quite often.

For FB, think of it as a place to connect with your audience. You probably aren't going to see a lot of click-based performance, but there might be a strong view-through correlation since it is very similar to display in that regard. So if you are trying to raise awareness of HR people for example, you can probably target them pretty easily on FB, and if you give them shareable content, that can help be a force multiplier since you won't pay for the shares. You just have to be clever about your targeting, and even more clever about how you are measuring things from an attribution standpoint. If you are expecting it to perform well on a last-click basis, you'll likely be disappointed.

Great tips Simon, Thank you - I really appreciate your words. I think you have summarised my marketing mistakes really well and given me a lot to think about.

By the way, I have checked out StaffSquared a while back and think it is brilliant. Your app inspired me in a lot of ways to create HR Partner. I've also seen you interact on a few HR or software oriented blogs/forums (as well as here) and think that is a great way to raise awareness of a business.

Thanks for your inspiration and advice.

Hey CyberFerret, your app looks great and you're very welcome. I hope it goes somewhere :)

Thanks for the kind words about our app - hit me up if I can ever be of more help. Given you're the other side of the world and it's a big place I don't mind helping out where I can.

Could you expand on the choice of the advertising platform? Do you find that Bing performs better than others?

Yep - less competition and hence lower PPC prices for keywords that are highly sought after on Adwords.

There is of course less traffic overall, but more of it converts at a price we can stomach.

Would definitely recommend anybody in any industry struggling to make Adwords prices stack up check out Bing.

Years ago when I did this sort of thing, 'less traffic overall' was maybe 5% of the traffic on Bing that you would see on Google. Often traffic was so low it wasn't worth the extra overhead of trying to manage the campaign. I'm not sure if this is still the case, and to what degree?

Totally agree with you, that was the case before but not now...

Microsoft have slowly caught up and now operate around the 20% search volume mark versus Google's 60%. Here's more info on the market share breakdown: https://www.comscore.com/Insights/Rankings/comScore-Releases...

The thing to also keep in mind is the %'s will vary according to the preferences of your target audience. For example, our target audience are office based with an admin focus. They tend to use a Microsoft OS, which usually has Internet Explorer and you guessed it - has Bing setup by default!

I suspect if you're going after a more "techie" crowd that they're more likely to use Chrome, and therefore use Google for their search needs.

Obviously all that really matters are the conversion numbers for your particular app. So I usually recommend that people set up some ads in Bing to mimic what they've setup at Google Adwords. Bing has a Google Adword importer, so just import your Adwords and then run them on Bing for a few weeks to see how you fare.

That's what we did for Staff Squared, and we were much happier with the Bing numbers than we had been Google - and still advertise on Bing even now.

Are there any major differences in who the audience is between Google and Bing?

Not that I've noticed.

> Don't get me wrong, I am not really complaining as I have a steady core of users who seems to use the app regularly, but I am mystified at the very low rate of converting visitor and initial account creators into regular users.

Have you asked them?

No, I'm dead serious. Have you dropped any of them a note or scheduled a call to see why they don't stick around? If you can gain information that increases your ratio from 1 in 20 to 2 in 20, you double your funnel (and potentially revenue) immediately.

Hi, and thanks for your feedback. I do ask the clients who don't stick around, but unfortunately I almost never get replies. I have an automated Intercom personalised note that goes out after 30 days if they don't log back in, but get next to 0 replies, or else one liner "Not really interested" type replies.

A few months ago when I only had about a hundred signups, I actually sat down one weekend and wrote individual emails to people who had not logged in in a while. I even went to the lengths of visiting their own company web pages and checking their location via Intercom so I could open the letter with "Hey Bob, hope the weather is great in Berlin - I see you run a small catering company..." etc. but even those got negligible replies.

A little better is asking my existing users. After about 20 logins to our system, I have Intercom pop up an in app message asking them to name one thing the love and one thing they don't like about my app. That one almost always gets a response and is proving to be really useful, but alas not helping with retaining users who sign up and disappear...

Have you tried to cross reference referral source to active users?

If people find you based on certain keywords or links, they may think that your tool solves the problem and once they try it... yes? no?

It may be that your SEO is (inadvertently?) describing you as one thing when you're not that at all.

It seems you're doing a great job trying to connect with your customers. Congrats. Most people don't try that hard.

Have you tried capturing phone number as part of the sign-up process and calling customers who don't seem to be using your software?

Yes, this. It seems almost too obvious but a few interviews can be incredibly revealing. You should also do this with your exising happy customers, and ask them how they'd explain the value to someone else.

Sounds like you're doing great!

If I could offer one bit of friendly criticism, it relates to this sentence:

My biggest struggle is that because I am still actively developing and adding new features to the app, I have problems putting down the coding tools and building momentum with marketing.

I keyed in on that particular sentence because it sounds almost exactly like something I said in a few of my own solo ventures. The longer that I kept adding features, the easier it got for me to think that the next 'killer' feature would turn everything around and I'd end up with legions of customers begging me to take their money.

In retrospect, I think that this all relates back to how, for me at least, development is easier than marketing. Marketing always felt like I was banging my head against a brick wall, but dev was the exact opposite - I'd get things done and get all of these constant little rewards.

I wish that someone had told me to freeze features for a few weeks and get out there and start hustling. In retrospect, I realize that I wasted much of my runway adding in features that nobody would ever actually pay for. Since I got so distant from customers, I didn't realize that until it was too late.

Andrew Chen actually wrote a blog[0] on this exact topic titled: "The Next Feature Fallacy: The fallacy that the next new feature will suddenly make people use your product"

[0] http://andrewchen.co/the-next-feature-fallacy-the-fallacy-th...

I remember reading a Joel Spolsky blog post a couple of years ago that contradicts this. I can't find the post anymore but I think he said that out of everything he tried, nothing gained him more customers than adding new features.

Good link. Thanks for sharing!

Thanks for your thoughtful feedback. The main reason I keep adding features and improving current ones is because, usually when I DO get a reply from someone who ceases to use our system, they usually say "Oh, I thought your system was great, but I really needed something that would do X".

In a lot of cases, "X" was something that I was either already planning to add later, or else would only take a small tweak to accomplish, so I go ahead and do it.

But in almost all cases, when I reach out to the same user (I track all feature requests against users) to get their feedback, a lot of them don't come back anyhow, so I am not sure if they missing feature was just an easy excuse for them, or perhaps they have found something else out there that does have that feature already?!?

I wish that I had good advice that would fix this issue for you. Unfortunately, if I could, I'd be so busy and have such an incredibly high hourly rate that I wouldn't have time to reply to comments on Hacker News....:)

I've learned a couple of things about users. The biggest one is that users tend to make a value judgement about your product very quickly. They're not even entirely conscious of the factors that went into making the decision. Often, they'll try to use logic to justify why they feel the way they feel...and one major way they do this is via feature requests. Unfortunately, since they are just grasping for straws, adding this feature often does not resolve the initial feeling that your product is not right for them.

Best of luck to you - I'm certainly in your corner and wish you an incredible amount of success!!

Love the site.

One small thing I noticed - remove the 'carousel' from your landing page on the top image. I was reading your main CTA - when it suddenly changed to the other image. It is too fast. If you want both - perhaps A/B to see which one is best.

Also - you mentioned you are using Intercom.io; have you tried using their feature Acquire? It allows you to communicate with potential customers on your home page. I've used it on one of my sites with great success...

Thanks. Good tip about the carousel - I may consider randomising the web page to show either/or and measure, or else increase the time on the carousel flip.

I don't use Acquire yet - mainly a cost reason because it would increase our monthly Intercom bill quite a bit, but also a 'back of the clock' reason. I notice that being in Australia, a LOT of site visits and new user subs happen in the middle of the night for me (i.e. on the other side of the world), and if I had users pinging me with questions etc. before signup then it would mean lots of sleepless nights, and less than stellar interaction with me.

I do plan to add it in later though, perhaps when I have enough revenue to add team members to look after acquisition and support.

>I notice that being in Australia, a LOT of site visits and new user subs happen in the middle of the night for me ..... then it would mean lots of sleepless nights, and less than stellar interaction with me.

You may know this already, but there are some customer interaction (not sure what is the right term here) services that, if you are not logged into them, will convert the user's IM into an email to you. https://tawk.to is one of them (I use it on my web site); Olark may also support that feature.

Then you can just answer in the morning. Of course it's not the same as being able to reply immediately, but better than nothing.

I am no expert but I think if you sell B2B ads on FB and Twitter are not best place. It doesn't look professional IMO. And I think really people who make decisions in business are not hanging out on FB. More like on LinkedIn and specialist sites relevant for their business.

That's just plain wrong. I'm sorry I can't be more constructive but what you say makes sense on paper, but is not true in reality. b2b purchasing decisions are still made by people who are as obsessed with social media as everybody else. You just have to figure out the best way to approach them. LinkedIn on the other hands has a very high bid floor which makes it a very tough to turn any return on the investment.

Yes to testing LinkedIn. Twitter could also work if your audience hangs out there (you may be surprised...). On Twitter and LinkedIn you're catching people as they're browsing, not actively looking for a solution, so you should promote educational content rather than the product/service itself.

Good tip. I've pulled all paid advertising from Facebook and Twitter, but there are a TON of HR related companies on there tweeting articles and advice, so nowadays I actively seek out great articles and use BufferApp to schedule a regular trickle of them on my own feeds.

I get a fair few new followers and retweets etc. this way, but impossible at this stage to measure how that relates to sign ups.

I'm not an HR manager, but one of your main points on your landing page is security, yet there are a few ways you link to unsecure versions of pages, including login pages.

In fact the sister site you built doesn't have a certificate at all. Modern browsers will show scary warnings when login pages aren't served over https.

Thanks for the heads up - We do use https all through the actual web app, but the server has the option to run http or https together. We are in the process of making it enforce https on all web app pages. The main page should link to only https pages on the web app so I will check it out again to ensure it does.

I know the main page links to a documentation site and a blog, but those are running on two independent servers without https at this stage - we may add it later, but they are 'non critical' site that are purely informational and don't store any customer data.

As for the sister site, yes that was a quick weekend build also running on a separate server. Seeing as that is a totally zero revenue site, I didn't want to spend any additional $$$ out of pocket at this early stage (though I may try out one of those free SSL certs that are becoming available now). If it proves to be useful in funnelling users to our main HR site then I will definitely beef up the security on that too.

Please excuse, if my comments come off as presumptuous or overbearing, you certainly know your business and customers better than I do, I’ll just rattle off what my set of fresh eyes observed and what I think you might want to look into.

In general, what stands out to me is that you do not have a clear USP and you do not seem to speak your target markets language, it might be that since you are addressing markets in many different verticals that you have no clear persona in mind to convince with your copy, no specific set of pain points or benefits to address directly.

In any case, I would try to interview my current customers, ask them to describe in their own words how your software is helping them, what pain they were experiencing before and how they previously dealt with it. 
Then you can go about ‘cloning’ them by marketing to specific verticals, have landing pages for hospitals and retailers, agencies and address problems specific to these industries using the information and sound bites you mined from your customer research. 
This will also allow you to do some long-tail SEO, produce relevant white papers, tailor your testimonials and in general tighten your copy since you now know who you are talking to.

Take a look for instance at your benefits, they are not benefits, at best they are product features: “Reminders & Communication”, and some are not even that: “No Install Or Setup”.
How about “Never fail audit xyz again with our bullet employee foozle tracking system”, find a specific problem and tie it to what your software can do.

 There is an interesting line on your landing page:
“Stay on top of critical legislative and legal requirements to store and recall employee.“ How many businesses are not compliant with these requirements, what are the consequences, use this risk and fear in your marketing, it is a strong motivator and sure to catch the attention of any business owner or HR manager, HR is inherently boring if you can’t excite at least agitate.

This is also a great opportunity to educate, small business owner, entrepreneurs, agencies, we all like to skimp on HR, do more research on the legal risk and host a webinar for business owners educating them on it, underscore the necessity of reliable HR management for becoming a ‘serious’ business.

I also found there was a lack of strong social proof on your site, this is HR show some people, preferably happy teams, show company logos, media mentions, photos of the people you quote. If you have impressive sounding metrics such as the number of employees processed by your system, total payroll handled etc. display them somewhere.

Also, if you aren’t already, try outbound sales, email people, get them on the phone, discuss their problems and whether there is a mutual fit, maybe you can uncover a great selling point, niche or approach, read Spin Selling and Predictable Revenue. If you can get this channel to work profitably and in a predictable fashion, you have total control over your revenue. If you not going full outbound make it easier to contact you, many companies, especially old economy want to talk to someone on the phone, no-touch sales on the internet is a tough proposition in some industries.

As to pricing here you probably have the easiest wins, get rid of all your plans (especially the free one) charge 19 bucks or something per employee in the system, this is a true value metric, easy to understand and uniform. Right now you have a large number of fairly arbitrarily split pricing plans, with non linearly increasing prices, why do bigger companies pay less per employee, if anything you should find a way to have them pay more. Not only will this increase your revenue, you will also grow linearly with your customers. 
Once you have built out quantitative buying personas, that is quantifiable sets of customers that differ in they price sensitivity, budget, the features they value etc. (most likely corresponding to the different verticals you serve) then go about and segment.
Have tiers actually cater to distinct customer groups segmented by meaningful criteria such as specific feature sets, integrations with industry specific software etc.
see here http://www.priceintelligently.com/blog/everyone-in-saas-is-u... for more info.

You also mention HR consultancies, is there a way to partner with them, offering either a white label version of you software they can sell to their clients or a commission, are there opportunities for other types of partnerships; events, conferences, case studies etc?

You seem to have a great product in a good market I hope you have commensurate success :)

Hey, thanks so much for your detailed and articulate reply. So much goodness here that I am going to take some time to go through and work on. I really appreciate you taking the time to go through my site in detail and highlight the problematic areas. This is gold, and I am really thankful. Nothing overbearing or presumptuous at all - it is 100% nail on the head good advice, and some of the best I have received to date (even after talking to a lot of 'expert marketers').

Wow, thanks, I am glad that you found this useful. I wanted to edit some stuff and make it a bit more readable but the update form is a little crummy.

If there are any points I can clarify further let me know, thi s is a really off-the-cuff sketch and I had fun doing it and wouldn't mind digging a little deeper on some ares.

I am currently a developer in charge of growth at photoeditorsdk.com and about to crank on our inbound marketing. Although a very different market from your's we've had success with cold-emailing as detailed in [Predictable Revenue](https://www.amazon.com/Predictable-Revenue-Business-Practice...). The biggest boost came from preparing industry specific sales pitches & demos.


I previously started Roll20, and it is now a profitable SaaS business. It started off as just myself, then very quickly I added 2 Co-Founders, and now we have 8 people total working on it full-time. For that business, we used Kickstarter to get it off the ground, and then just slowly built through word of mouth and a strong built-in networking effect.

I am in the process of starting my next project right now; it's a VR small-scale MMO called "OrbusVR". I've been working on it for about a month now, and I've got a blog up (http://blog.orbusvr.com) where I've been posting development updates at least weekly; I've also been posting frequently to Reddit in places where potential players are likely to hang out (e.g. /r/vive). I have around 50 people already signed up on a newsletter, and every time I post about it I gain another 10-15 subscribers. I plan to launch a Kickstarter for this project as well probably in the next month or two; both to "fail fast" if there isn't going to be a large enough playerbase to support it, and to get a boost to the funding (which is 100% out of my own pocket right now).

So I guess in my experience, the trend has been:

1) Make something people really want already, but don't have.

2) Work on it in the open as much as possible to build up an early evangelist community.

3) Do a Kickstarter campaign or other event to gauge actual "I will spend money on this" interest.

4) Continue to grow slowly via world of mouth until you reach a tipping point where a network effect kicks in and then just grow from there.

Meat and potatoes selling.

1) Found a list of potential prospects

2) Called 30 prospects each day

3) Repeat steps 1-2 for 4 years

That is really excellent advice. Thanks for adding it!

Yes. If you can generate a very large list of prospects, emailing them works too.

David Oglivy (ad firm founder) has a great quote:

"If you want action don’t write. Go and tell the guy what you want."

The first step is talking to potential clients. It helps if you have something to show, but it's not necessary—you only need to grok the problem, and then keep an open mind, as there might be some things you haven't already thought of.

You keep working closely with that client, listening but more importantly, watching what he does. Then you find another and you try to fit that solution into their work flow. If that doesn't work, keep an open mind and tweak your product. Repeat as needed.

Regarding the customer acquisition channels, YMMV: whether you're selling B2B or B2C, your target is tech saavy or not, and even if a similar product is positioned or not. Next, you might need to check your competitors and their strategies, there might be a couple of clues there.

We have a side project[1] on a similar target group, which helps enterprises calculate a number that's not too easy to do by hand or with Excel. We get a couple hundred visits a day, and we have a small ad in there. It has given us some visits and some sign ups, but we might tweak that a little so we can contact them and offer a demo, which is something that has worked for us.

Also, we just launched a new home page[2] this month, I suggest you invest in your landings so they look good and professional (or whatever you want to communicate). We have also some automated mailings for potential clients, and it has brought us business, altough indirectly, because we have to demo our product. We now are working on a video, as it might be easier to explain how it works.

1: https://isrmatic.com/

2: https://www.boxfactura.com/

> Saw this thread from a couple of days ago about profitable one-person SaaS apps.

I missed it, can you share the link?

I replaced a crappy tool (think Windows only client) with a web based version.

Emailed everyone in the industry.

Profitable ever since.

(Somewhat simplified, but not really)

How did you acquire your email list? Already highly networked, or?

2 ways.

Manually - via emails that were CC'd when sent out to groups, etc.

Scraping - scraped a few industry websites.

Completely depends on where your target audience is. Are they searching for your solution already? If so, where?

Whether you're selling B2B or B2C is also going to make a big difference here.

Our main channels getting started were Google and a review site called Capterra (did paid advertising on both), as well as LinkedIn Marketing. Now we have a few other channels and partnerships but that's how the company got off the ground and profitable (I say we to refer to myself and my business partner)

Can you provide more detail about ad-buy allotment and conversion rates of Google vs LinkedIn, in your personal experience?

I wrote a lengthy guide on LinkedIn advertising just a week ago.[0] Conversion rates vary so much that it's better to just run a $250-$500 test campaign and measure your own baseline.

The conversion rates for AdWords (Google) and LinkedIn campaigns are going to be different because the ads are (or should) be different.

On Google, people are searching for a solution, so your ads should promote your product/service. On LinkedIn, people are just browsing so it's more effective to promote a helpful resource (eg, a guide or whitepaper).

[0] http://www.gkogan.co/blog/the-complete-guide-to-getting-sale...

I just finished reading it.

Good information and nice illustrations.

For your illustrations, do you use pen and watercolor?

Thanks for the kind words.

I use pen and water-based markers (Prismacolors); they look like watercolors but are much easier and cleaner to handle.

So, after illustrating in color, you scan and convert to grayscale? or, scan as grayscale?

It looks "classy".

How was your experience with Capterra advertising? Was it a B2B Saas?

At http://voucherify.io (API platform) we try to follow Zencoder's advice


To put it in a nutshell, this means generating valuable content and implementing helpful libraries and integrations. Then we try to share it with our target (developers, technical product managers, CTOs) through ProgrammableWeb, GitHub and Quora. See e.g.

- http://www.programmableweb.com/api/voucherify

- https://github.com/voucherifyio/coupon

We're a team of 3.

Are you guys profitable? I feel like it's super hard to be profitable for any length of time in any developer tools business, because there are many perceived alternatives including build-it-yourself.

In contrast, if you want to build a small profitable SaaS business, I think one of the best pieces of advice would be to focus on an under-served group that can't implement software for themselves.

Not yet. We realise there's a long road in front of us. Integrations with bigger enterprises take time. Nevertheless we grow steadily.

I'm not yet profitable, but I think I accidentally stumbled upon a way to get there...

My current SaaS app PressKitHero (https://presskithero.com) started out as a Shopify App (https://apps.shopify.com/presskithero).

I did zero marketing for the Shopify App. All I did was put it in the Shopify App Store. It gets good reviews, and a steady stream of new installs. About 10% of installs then convert into paying customers. Right now (after 6 months), the app is doing about 800$ in MRR.

I think for solo software developers, who struggle with marketing, the Shopify App Store is a really good place to get started.

If you invent something new and novel that people actually love, just posting in Facebook groups alone can grow you to xx,xxx USD MRR. Word of mouth will then carry on from there. If you are making something much less interesting, then marketing gets a heck of a lot harder.

I had a marketing application that sort of hacked on the Twitter API. Because of the API TOS, we couldn't really tell anyone how to use it, which made online marketing very difficult.

The solution I found was to host in-person classes on social media marketing. I would give a high level view of the marketing strategies and then plug my tool as one of the options.

This had a few advantages:

- Everyone had been "on boarded" before even trying the product.

- Everyone now had expertise on the subject they could share with friends and coworkers.

- Each class gave me the attention of ~30 genuinely interested people.

- The income from the classes really helped as I bootstrapped the startup.

Of course - some people were very annoyed by my advertisement. But in all fairness, the information was high value and many people enjoyed it.

"Because of the API TOS, we couldn't really tell anyone how to use it, which made online marketing very difficult." - Can you say more about this? What were you doing that violated the TOS?

I encourage everyone to find a market and a way to gather attention before making a product. It's the opposite order of what many people do, and they could learn on mistakes rather than their own.

Direct sales, then customers refer to other prospects. Focus hard on those first 10-100 customers and they will reward with loyalty + referrals.

Also, say no to some deals; can't please everyone

What if you have a product which the potential customer doesn't know yet it needs? I guess you can create the need (or let the customer see that it needs the product) by giving away a free version first for some time.

But how would you find the customer in the first place? How would advertising work in such a situation?

Example: mobile phones. In the beginning everybody was on landline; how do you convince the user they need a mobile phone? A similar problem may exist for certain SaaS markets.

If you cannot identify the customer, how do you know the product is something they need?

The recipe for success seems to be to understand a market or vertical and then offer a solution to an existing problem (their greatest pain) that particular market faces.

By targeting a market instead of a solution, you can cultivate your customer list, and up-sell or cross-sell relevant, related solutions.

The other almost-guaranteed path to success seems to be to create an internal tool for your own business pain, and offer that solution to others that are experiencing the same problem.

But trying to sell a product that you have not validated is an uphill battle.

Move closer to customer step by step. Think of a funnel-based marketing process like AIDA: attention -> interest -> desire -> action (https://en.wikipedia.org/wiki/AIDA_(marketing)).

In the first stage - attention - use whatever grabs target group's attention. It can be very broad. Think of how beautiful ladies, beaches and kittens are used in advertising (yes, they all work like magic).

Once they start looking at you, go somewhat closer to what you do, start creating interest in your solution.

There are tons of successful companies where the road from attention is long and windy. We all dream of people searching exactly for our solution and immediately converting, but quite often that's not the case - and it's OK. Marketing and sales can be hard.

First example that came to mind is Buffer. A lot of the marketing they do is not related to their product area. It's just a good attention-grabber.

Don't be in the business of converting virgins.

if it's a problem people solve it somehow

look for people who already solve it alternatively

convince/learn-from/acquire/market-to them

We blog like crazy mofo's.

Educate yourself and your consumer all at the same time, and do it daily for two years straight. You can't not have some level of results if your writing is decent or better.

Combined with excellent technology, it's a nice win-win.

Also, Start Small Stay Small book is very useful for this sort of thing.

https://datamantle.com is ran by a one-man-army. At the moment only advertising on hckrnews as SEO catches up and all.

tsurprise.com offers tea subscription on highly competitive market. Primary focus on content to rank, then lead generation with bloggers for PR and coverage. Bootstrapped and profitable in 4 months.

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