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Experts Share What To Consider When Running A SaaS Startup

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SaaS is short for Software-as-a-service and it is a way of bringing users apps online, as a service, instead of through installation that is traditionally used. This means users can access applications such as email, calendaring, and office tools directly through their web browsers. The software and its functions are hosted on remote servers managed by SaaS providers.

The main reason SaaS would be preferred in this day and age is due to how it can be used across devices that have internet, where software updates are no longer a factor due to the provider doing the updating on their side instead.

How Does SaaS Benefit Users?

The biggest perk of SaaS is its accessibility and cost-effectiveness. Users can operate sophisticated applications like CRM and ERP systems without the need to invest in hardware or complex software setups. This is especially useful for SMEs, startups, or those without substantial IT resources.

Also, the pay-as-you-go model used with SaaS means costs are scaled according to usage, so businesses only pay for what they need. And since everything is on a cloud, there is no data loss as a risk, should a local machine fail.
 

How To Run A SaaS Startup

 
Running a SaaS company can be daunting, especially in the beginning. What better way to inform oneself on how to run a startup than taking note from startup founders? The experts and industry leaders below have shared extensive and useful comments, tips and guidance on what exactly should be taken into consideration when running a SaaS startup in this day and age:
 

Our Experts:

 

 

Dominic Allon, CEO, Pipedrive

 

 

“Having a lightbulb moment for a new technology product is a great first step, but the journey to market doesn’t start and stop there. Setting up a software company involves many checks and processes – moving from gauging appetite for a service, competitor analysis, pricing strategy, to preparation, pilot testing and launch, through to sustained advertising, sales pushes, compliance and customer support. All these elements need to become linked together in order to take a great idea off the ground.

“This is why it’s business-critical for innovators to link up with other experts, including legal, marketing and strategy professionals. In the same way a car needs separate parts to drive, so does a business. You can’t function on an idea alone, and having capabilities in all these areas is what helps an idea become an engine, and eventually scale with time.

“It is also vital to prove the efficacy of your product to the right people. If you need funding and investment, to help boost core areas of your company, then investment capital can be that foundational fuel, giving valuable options to remove financial barriers to growth.”

 

Johannes Karjula, CEO & Founder, Trustmary

 

 

1. Stay close to the customer: Whether you’re a startup or already in a growth phase, founders must regularly understand their customers’ lives. This can be done through video calls, chat support, or Hotjar recordings. Solving the customer’s problem effectively increases the value you provide, leading to greater financial rewards.

2. Prioritise the customer journey: Improving self-service SaaS is about enhancing the customer experience and removing friction. Focus on small details throughout the entire journey, from awareness to advocacy. Track key metrics at each stage to boost motivation and optimise results.

3. Foster internal collaboration: As teams grow, silos can form. Encourage cross-functional collaboration to share insights and solve challenges, maximiSing collective learning and understanding across the company.

 

Ben Ajenoui, CEO and Founder, SEO HERO LTD

 

 

– Market Research:
A founder should conduct a thorough market research to identify target customers, understand industry trends, and assess potential competitors.

– Product-Market Fit:
One should focus on achieving product-market fit by continuously gathering feedback from customers, iterating on the product based on user insights, and ensuring that the solution addresses a real pain point in the market.

– Scalability:
Build a scalable infrastructure from the start to accommodate growth and handle increasing demand. Consider factors such as cloud scalability, data security, and performance optimisation to support the long-term success of the business.

– Customer Acquisition:
Develop a solid customer acquisition strategy that encompasses marketing, sales, and customer success efforts. Founders should prioritise acquiring early adopters, building customer relationships, and optimising the customer journey to drive growth.

– Financial Planning:
Maintain a clear understanding of the startup’s financial health by monitoring key metrics, managing cash flow effectively, and planning for both short-term and long-term financial sustainability.

– Team Building:
Assemble a talented and diverse team that complements each other’s skills and shares the vision of the company. Foster a culture of collaboration, innovation, and continuous learning to drive the company forward.

– Regulatory Compliance:
Stay informed about industry regulations, data privacy laws, and compliance requirements to ensure that the SaaS product meets legal standards and protects customer data.

– Adaptability:
Be prepared to pivot or iterate on the business model based on market feedback, industry changes, or emerging trends.

– Networking and Partnerships:
Build a strong network of industry contacts, mentors, investors, and potential partners to leverage expertise, gain insights, and open up opportunities for collaboration or growth.

More from Startups

Scott Dylan, Founder, NexaTech Ventures

 

 

Product-Market Fit is Everything: Before anything else, ensure that your product solves a real problem for a specific audience. Too many SaaS startups fail because they focus on building features that aren’t needed or valued by their market. Customer validation early on is crucial.

Scalability from Day One: SaaS models inherently rely on growth. Your infrastructure must be built to handle rapid scaling—whether it’s your cloud architecture, customer support processes, or your pricing strategy. If you’re not ready to scale, you’ll bottleneck growth when demand spikes.

Focus on Retention, Not Just Acquisition: The real strength of a SaaS business lies in recurring revenue. Attracting customers is one thing, but keeping them is where the real value lies. Make customer success a priority, continually improving your product to meet evolving user needs.

Data Security is Non-Negotiable: Trust is critical in SaaS. Ensuring that your software and customer data are secure should be a top priority, especially with increasing scrutiny around data privacy. Implementing strong cybersecurity measures from the start will safeguard your reputation.

Pricing Strategy Can Make or Break You: Don’t undervalue your service. Many SaaS startups make the mistake of pricing too low to attract customers, only to find it difficult to increase prices later. A well-thought-out, tiered pricing strategy is essential to balancing value and growth.

Keep Your Burn Rate in Check: It’s easy to burn through cash in the early stages, especially with constant pressure to innovate. Stay mindful of your cash flow and ensure your spending aligns with your growth rate. Investors and customers alike respect a company that manages its finances efficiently.

Culture of Continuous Learning: Tech evolves fast, and so should your team. Building a culture where learning, innovation, and adaptability are central will keep your SaaS company ahead of the curve.

 

Matthew de la Hey, CEO, inploi

 

 

1. Get to know your customer needs: Invest time in market research and customer discovery. Your product must solve a genuine problem for a well-defined audience. This understanding should evolve as you grow and get feedback from being in the field and working with customers.

2. Build market size from the ground up: Start by establishing a clear understanding of your target market and ideal customer profiles. Set realistic and specific targets, and ensure your efforts are aligned to achieving these. If an initiative is not, ask why?

3. Build a scalable product: Ensure your platform is designed to scale, both in terms of technology and architecture. At the same time, maintain flexibility to pivot based on market feedback and changing needs.

4. Don’t underestimate the challenge of building a sales team: Establishing a high-performing sales team is extremely challenging. It requires not only hiring the right talent for your organisation, your buyer personas, your target market, the nature of your product etc. – but also understanding complex sales cycles, and creating clear messaging and supporting collateral. Effective onboarding and ongoing training are essential to equip your team for success.

5. Prioritise customer success early on: Customer retention is as important as acquisition. Implement processes for continuous customer feedback, and build a strong customer success team to foster long-term relationships.

6. Learn from your mistakes: Be prepared for challenges and mistakes, such as misjudging sales cycles or overestimating demand generation. Embrace these moments as learning opportunities and iterate quickly based on market feedback to stay on course.

7. Invest in a strong team and culture: Focus on hiring people who are aligned with your mission and values, and create a culture that fosters innovation, collaboration, resilience, and performance.

8. Develop a data-driven approach: Make decisions based on data rather than intuition. Track key performance indicators (KPIs) from day one and iterate your product and strategy based on these insights.

9. Be prudent: Manage your cash flow carefully, diversify your revenue streams, and maintain a balanced approach to scaling.

10. Focus on brand building: Beyond just a great product, invest in building a strong brand identity and a compelling story that resonates with your audience and differentiates.

11. Prioritise security: Given the sensitivity of data, ensure that your product complies with all relevant regulations and follows best practices in cybersecurity. This builds trust and is essential to working with enterprise buyers.

 

Nenad Milanovic, CEO and Founder, CAKE.com

1. Try to practice financial discipline. We went for years refraining from excessive spending and took things slow with expanding our team. This way, we avoided having to turn to external sources of finance, and I could make all the key decisions without a third party affecting my choices. I’m well aware that retaining financial independence is not always possible. This is especially tricky in times of crisis. But turning to third parties for funding also means that there’ll be one more stakeholder involved in your decision-making process. And that is the part where you put your company’s growth at risk too.

2. Also try to be customer-oriented from day one. Paying close attention to your customers’ feedback helps you discover where you stand each moment. Try listening to your customers because they usually give you first-hand info on what you should be doing to ensure your product matches their needs perfectly.

3. And try to foster transparency, because when you do that your customers know what to expect from you, and in turn, they know they can trust you. Your products speak for themselves, and you might even never have to do unsolicited outreach (which sounds great if you’re not big on it to the extent I’m not).

Cas Paton, Founder, OnBuy

 

 

Running a scale-up is not for the faint hearted. Starting a business is hard, proving your concept is hard, and scaling it is harder. As a founder, you need to be determined and incredibly resilient with an unshakable belief in what you’re trying to achieve. You’ll need to bring your A-game 24/7, so be ready!

Growing OnBuy to become the largest UK marketplace and one of the fastest-growing British tech challenger brands has not been easy, but I’ve learnt a lot along the way.

 

Most importantly:

Cut waste, analyse everything, understand cohorts, add value and add services. You need to constantly innovate to ensure you’re always delivering new ways of generating revenue and growing the business.

Stay agile. Allow yourself the flexibility to measure, review, make fast changes and fix forward. Don’t be afraid to revisit, redesign or reject an innovation if it is not working or performing. Every release has to deliver value and sometimes you have to be honest with yourself and make tough decisions if it doesn’t

Aim for critical mass and profitability. Don’t be scared of investment if it gets you there faster, but don’t take investment if it won’t.

Know your exit – who is going to buy you, and why, or will you choose to float? Remember this as you shape your business and positioning. You must make it crystal clear what problem it is that you solve.

Always raise the bar. And as you scale out, don’t carry anyone because the business won’t carry you.

 

Josh Lamerton, Co-founder, PropTexx

 

 

Scalability is a key factor for SaaS companies to ensure seamless performance as user demand grows. In the SaaS model, where services are accessed online by potentially millions of users at once, infrastructure must adapt quickly to handle traffic spikes and maintain reliable, responsive performance.

Horizontal scaling—adding more server instances—and vertical scaling—increasing the capacity of existing resources—are vital strategies to prevent slowdowns and outages. SaaS companies often rely on microservices architectures, containerisation technologies like Docker and Kubernetes, and load balancing to distribute workloads evenly across the infrastructure, ensuring no single point becomes a bottleneck.

Databases also need to scale effectively. NoSQL databases, with features like sharding and replication, are designed to handle massive amounts of data without compromising performance. Additionally, monitoring tools like Prometheus and AWS CloudWatch enable real-time tracking of infrastructure health, allowing teams to proactively address any potential issues before they impact users.

Without a focus on scalability, SaaS providers can face costly outages, poor user experience, and higher operational costs, leading to customer churn. In today’s competitive market, ensuring that infrastructure can scale efficiently is critical to maintaining service reliability, improving user satisfaction, and supporting long-term business growth.

 

Vipin Makhija, Founder, Product Leader, Mentor, Advisor, Kast

 

 

1) Validating the opportunity
It is crucial to validate that you’re working on a problem which is real and worthy of a solution. This means regular and thorough quantitative and qualitative research to understand the pain points of the ideal customer. Also clarify what the market size and potential of the opportunity of the SaaS product is. This exercise ensures that the problem is persistent and is faced by a large number of customers who will be willing to pay for a solution.

 

2) Building the early product
Prioritise progress over perfection, especially in early stages of your Saas journey. You will always have more ideas than you can build in a timely fashion because of resource constraints. Once there is a foundation of a prioritised roadmap, break it down into smaller chunks/phases and build the first prototype to get customer feedback, before building a full scale SaaS product.

 

3) Going to market
Getting the product on the shelf is important, but if you’re not able to get it off the shelf, it will not be a successful venture. Market penetration strategies have to be considered even before the product is ready to be marketed and sold. From product marketing, positioning, messaging , marketing channels. pricing and partnerships are all aspects that you constantly need to refine, evolve and test with your customers and users.

 

Boris Markovich, Co-Founder, Ayrshare

 

 

“Focus on buyers and end user:

“Buyers and end users are equally powerful in the success your start-up. Regardless of how far away the end user is from those holding the purse strings, they’ll ultimate be key in deciding whether a buyer will continue using your product.

“Your marketing efforts should target both pre and post launch, with content tailored to each specifically. For us, we engaged with our end users, developers, where they hang out online, creating detailed and no-fluff documentation that provided answers to all their questions. We gave the devs the meat they craved and the buyers the details and metrics to help them take that important purchasing decision.”

 

What SaaS Startups Should Consider When Engaging With Other Businesses For Growth

 

Damian Skendrovic, CEO, VeUP

 

 

For startups, engaging with large corporates presents a huge opportunity to supercharge growth. However, to do so requires a dedicated go-to-market approach to ensure their products, services, and operating models align with the way corporations engage and purchase services.

When larger organisations look to acquire new products or solutions, it can be difficult for startups and scaleups to work their way in these conversations as corporates typically look to established players who have the credibility of providing reliable services. It’s challenging, but far from impossible.

A comprehensive corporate strategy involves setting a clear vision, defining precise objectives, planning resource allocation, and establishing priorities. Put simply, to engage with a corporate, you need to think like a corporate. Consider what their challenges are? What specific pain points can your product or service solve? What are the opportunity costs to the prospect? How much time or money can you save them?

This approach not only enhances the startups appeal to corporate customers but also provides a structured framework for sustainable growth and success.

Sean Duffy, Managing Director, CIBC Innovation Banking Europe

Keep your customers happy – SaaS businesses inherently have, or at least should have, good margins given their low CapEx. But to maintain this they need to ensure they have no, or at least low, churn when it comes to customers. Founders need to consider how to keep engagement with customers high – how do you make it so they can’t imagine their life without your product? Whether that’s through being highly insightful or useful, is crucial. It simultaneously means acquiring customers shouldn’t be expensive or arduous. A good net retention rate is one of the best ways to start new conversations, expand relationships, and improve subscription numbers.

Can it be easily explained? – Although it may sound obvious, SaaS shouldn’t be complicated. Fundamentally, SaaS companies are meant to be solving a problem, not creating extra confusion. The best software businesses are ones that have a strong USP and can convey their message succinctly and easily for the non-technical buyer/investor.

Bad reporting is a no-no – Investment is a key part of the business journey for a founder and one of the biggest hurdles that businesses face when it comes to raising is bad reporting. Investors are always ready to interrogate so you need your facts and receipts at the ready. Ensuring that reporting is done well from the beginning mitigates any potential, and unnecessary, hurdles when it comes to that all-important investment. Without this, your business could be at risk of stagnating.

What’s the end goal – One of the best ways to get ready for investment, particularly debt financing, is to know who your company will ultimately exit to. Will it be a PE house? Or a big tech? Or will you IPO? Having a path of where you’re going is crucial for investors when thinking about their eventual payout.

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TechRound Team January 24, 2025

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