And how is that still possible? If there is huge a variety of time-tracking apps, how can you possible acquire a decent amount of customers? Verticals?
The other answers to this are good, but miss some fundamentals. Here are a lot of reasons why almost any SaSS idea you can think of will take off if you can find a way to market it for less than you charge for it.
1. New business are opening all the time. Every. Single. Day.
2. Most businesses go looking for solutions only when something is very painful. Convincing them of the need is something a lot of existing SaSS businesses don't do as there's so much low hanging fruit around still. If you can send a salesperson in, you win by default. You'll be amazed at how much you can charge for something.
3. Lots of businesses (the majority) are 5-10 years behind in the computerization of their business compared to any business you find mentioned here or any business you'll ever speak to at networking events for startups. That's pre-SaSS.
4. There are a lot of businesses where the internal IT dept wrote all the 'apps', they usually suck and are broken. More and more businesses are giving up on this model and buying the app off-the-shelf. A little customisability (logo, maybe colours, even name) goes a long way.
5. A lot of businesses still rely on some crappy Sharepoint or even Lotus or [insert unwieldy enterprise system here]. The internal people hate dealing with them and will switch to your system if you find someone with enough clout to sidestep 'the rules'. A 'department trial' is also a handy way in, some companies have very autonomous departments.
6. There's no such thing as an established SaSS businesses outside of the echo chamber of HN. Many businesses will not have heard of Salesforce, let alone basecamp. There's no such thing as an established time tracking tool for example.
7. Some 'great' apps are far too generic. New to do apps still come out every month
8. Marketing and designing your app for a particular market sector can give you a huge advantage over others. Just knowing the right words, phrases and acronyms to use gives you huge credibility with that market. Compare 'Project Management' to 'Project Management for Architects with full support for Drawing Issues and Revision Tracking'.
Before you embark on doing anything though, you have to accept that any business app you write is going to be incredibly complicated and you're going to have to fight to keep it simple as everyone wants to use it oh so slightly differently.
Just to add to your excellent list, a lot of verticals have an established software company that's stuck in the desktop world (e.g VB6/Access/etc, CD-ROMs, licence keys, etc) and is often clunky to use or old-fashioned looking.
The difficulty with vertical markets is cutting through all the jargon/assumptions and figuring out exactly what the business logic should be. Everyone knows what they want, but very few people can actually explain it to the uninitiated.
Think Power Builder, etc. Our company has purchased software with a Power Builder front end (mid nineties interface) to an Oracle backend for roughly a million up front and $100,000/yr in licensing.
We've subsequently built a web front end to this app in house.
Sometimes there is no good substitute for clunky software.
You'd be surprised. I've had many coworkers who carried around dayplanners just to note the time and date they were asked to do something.
If you basically do the same job every day, showing up at 9 and leaving at 5, it wouldn't be for you. If you are working on multiple projects, it's a lot more useful. Especially if your employer has an SAP type time tracking system where the charge numbers are so ridiculously complicated. As a contractor for those kinds of companies, I've always struggled with keeping track of how much time I've spent on any given day among the projects I was responsible for.
Then there are other types of professionals, like lawyers, who have to keep track of multiple tasks on any given day for billing purposes.
Point being, there are still plenty of potential customers for time keeping apps. Maybe not enough to get rich, but enough to help make a living.
Get 500 people to pay you $30 a month. Now you're making close to $200k a year - most likely a lot more than you would make consulting or playing the startup lotto. That's the basis of Amy's 30x500 course (disclaimer: I gladly paid > $1000 to take it).
Think about it: 500 people. That's fucking nothing. My upcoming niche project management tool has more people than that on the pre-release list (granted - only a percentage of them will turn out to be paying customers), but it's a great start.
Simply find some pain that needs to be solved, build a product around it, create an offer (give me $X and I'll give you Y) and profit. Take Amy's class if you want a kick in the ass to help realize that.
Be the first that supports multiple devices (PITA) and multiple browsers (except IE7 and before?).
Beautiful design (niche for those who marvelled at apps by their design).
Figure out SEO.
I think Amy and her husband are quite popular internet celebrity among bloggers. Turn these into your customers. This is important: if you have quite a few readers, think of how to turn them into money (let's not go into argument about purity, don't be evil, and that kind of bull-shitake).
On the flip side: whether her number is for real or not, I cannot say until I see the accounting by my own eyes. When it comes to money, pageviews and whatnot, I don't believe 100% as-presented. I might believe 95%, but definitely not 100%.
You can still strike big even if you're not first. Google and the iPod weren't first. Microsoft & Blackberry had smart phone OSs for years before the iPhone, etc. etc.
I'd guess by having a quality product with good design. Time tracking is definitely over-saturated, but Freckle is a simple, powerful product with great design. That makes it makes it much easier to stand out.
_neil is right. Freckle is simple (you can track time without the hassle of creating a project) and powerful (the multiple ways you can see your data is awesome, especially the "pulse" screen) with great design (its very pretty). That said, there's more features I'd love to see, but they are constantly improving the product, so its only a matter of time.
If you (or, okay, I) can create a new product which has certain selling points, and gain quite a lot of customers, how is the market still considered "over-saturated"?
I make my living exclusively in "over-saturated" or "nobody will pay for that" markets. Which so far has worked out just fantastically.
My first foray into an "over-saturated" market was a Mac news, opinion & tutorial site back in the late 90s. Every single person I talked to said the market was over-saturated, that nobody would read it & more importantly, I wouldn't get any advertisers. They were all wrong.
How CAN'T you acquire a decent amount of customers? The world is so much simpler and easier than you think it is. Maybe that sounds like hand-wavy BS to you, but it's simply the facts. Freckle grows even when we ignore it. We don't "do" verticals.
You're assuming that variety means people are satisfied. But as a rule, people are never satisfied, and rightfully so since most software is crap.
