I'm a founder at heart; I've loved creating - and have a software background. I really resonate with the paraphrased vibe of way, way more SaaS companies. I've been looking outside of SaaS to potentially harder science companies rather than SaaS for future endeavors.
It is too easy to: splash page, Wordpress, "rails new saas" for a product and then try to sell via SEO / outbound, etc that the field is quite saturated - and un-discovered niches are a lot harder than say 2013.
Can you help me understand how a billing model gets saturated exactly?
I never got this about SaaS. People talk like it is a vertical. How is saying "I want to start a SaaS" different from saying "I want to start a one time payment ecommerce business?"
I say this btw from having worked at a SaaS business for years.
Because it is, for many founders. Those who think, "I want to start a startup, make lots of money. A SaaS business is the easiest to start and most investor-friendly." What the business will actually do is irrelevant, something to be picked along the way.
I see it as a vertical too - a column of a larger vertical I call "toilet paper companies" (with no offense meant to actual toilet paper manufacturers and sellers): companies run by people who couldn't care less about what the company is actually producing/offering, and have zero interest in the thing they're selling (beyond pretending to, for marketing reasons). Companies that would gladly switch from making rocket parts to making toilet paper, if they believed it has better long-term ROI.
And yes, people who think "I want to start a one time payment ecommerce business" (aka. "a web store") are a part of that larger vertical too.
I understand your sentiment which I believed has a negative tone to founders that are more business focused - but I'll flip it.
Yes a company can be started along a founders personal passion... for this example, lets call it bikes [could be anything]. A founder following passions will create something around bikes - and in most cases fail due to saturated market, competition which they cannot outspend, etc.
Other founders approach business AS the passion. Surveying the competitive landscape, capital models, future growth potential - and marry that with building something for people, helping them solve their problems is the passion, creating a business structure designed around them.
> Other founders approach business AS the passion.
Yes. And my feeling is, this is where our market economy has jumped the shark. People running a business for the sake of running a business are able to put more focus, effort, knowledge and skill into optimizing its success. Many ways of doing so involve reducing the value delivered to the customer, but compensating it with manipulation (e.g. more marketing) or abuse (e.g. lock-in, dark patterns) - and all advantages gained this way compound. Thus, in a fair competition, a business run for the sake of its value has little chance of prevailing against a business run for the sake of being a business.
The problem I see with this is that the value of a business to its customers, and to the society at large, is in the product or service being delivered. The business as an entity is incidental, a necessary evil to generate the value. Businesses being run for the sake of running them seems, to me, like optimizing for precisely the wrong thing - putting the cart before the horse.
My bank account is filled with SaaS products. Want to read the news, get a premium “bank” account, automate stuff, watch TV or movies, etc? pay up buddy. It’s only a few more of your dollars a month.
It’s at a point where most consumers have to decide between one SaaS or another; it muddles retention. A one-time payment business is better these days (or a hybrid) especially if you have a product consumers are willing to come back for.
For me, it's the same problems but the opposite conclusion -- unless you're my rent, utility bills, a handful of subscriptions to print magazines or professional bodies (or my mother), you will not get a subscription out of me. I will simply not do it. One-off payments are fine, but the expected cost of a subscription is huge over my lifetime and the value of your product probably isn't worth it.
B2B SaaS have a much clearer/easier value proposition than B2C.
There's already a cash flow and profit motive in a business, so if a SaaS can demonstrate that it enables more value than it costs, there's a tangible advantage to paying for that service.
In this context saas isn’t actually the opposite of say “one time purchase software” but more analogous to “low hanging fruit low cost easy problem to solve with software”.
IMO saas is muddled so it’s meaning is not as much about the billing model anymore.
I personally use SaaS as shorthand for a business which mainly simplifies, eases, or improves business or personal problems or processes with software - and get paid for it.
I relate with your sentiment. I'm from a product background, not a research one. What do you think is the best way to eventually transition into deep tech companies over the next five years?
By deep tech, I mean getting to solve complex challenges through technology. It could be solving problems using machine learning, or a hardware product that's genuinely useful. I believe we're going to see a rise in hardware technology soon. After being in the phase of building a product to get upvotes on ProductHunt, I was trying to capture the essence of being an inventor by following a prescribed recipe, which wasn't satisfying. I ended up moving to a more business role and it's much better this way but we're barely building anything.
I'd like to play a role of an inventor and a builder of crazy technologies. Imagine https://www.noya.co/ or https://frame.work/. My only concern is that not being from a research background or a first world country could hinder my chance of doing that. Hope that made sense.
Yeah, that makes sense. I think the best way to do that is just to invent stuff. I've followed a similar-ish track in the past, and I can promise you that nothing upskills you more than actually building things.
Absolutely agree. The model of recurring revenue as applied to more than software is still powerful and I believe under explored given everyones focus on SaaS, mobile, enterprise, etc.
I agree, I think it is way more competitive in any pure software cloud type space. I think if you can bring something else to the table such as hard science, domain expertise, hardware, or electronics, it may eliminate a lot of the competition.
> It is too easy to: splash page, Wordpress, "rails new saas" for a product and then try to sell via SEO / outbound
Not even that, these days people simply start newsletters...
Still, I wouldn't write off the payment model. People seem to prefer subscriptions to one-time payments. If they didn't, Netflix, Spotify, etc., wouldn't enjoy the popularity they do.
That's a very niche and small cherry-pick that you did.
I practically know only 2 people willing to pay monthly sub for note taking or various such trivia. 99% of everyone I know is very conservative about monthly subs. Sure Netflix / Spotify / YouTube Premium / etc. are worth it but most apps out there really are not.
Plus there's such a thing as a "sub fatigue" these days. People feel everybody is after a chunk of their wallet each month and are starting to resist. I don't even mean myself or other tech-savvy people; I really mean mothers and grandmothers who have no clue but still don't want to pay up all the time.
I don't think SaaS and "potentially harder science companies" are necessarily opposed. I think there are still a lot of un-discovered niches that marry the two. Anything hard is going to take longer, but also result in less competition.
It is too easy to: splash page, Wordpress, "rails new saas" for a product and then try to sell via SEO / outbound, etc that the field is quite saturated - and un-discovered niches are a lot harder than say 2013.