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Software-as-a-Service share lessons on growth

13 Sep 2018

B2B SaaS
Shane Wood (left), Claire Faulk (middle), Bruce Aylward (right)

I recently attended Callaghan Innovation’s Southern Software-as-a-Service (SaaS) conference in Auckland.

Southern SaaS is designed for businesses with an interest in software-as-a-service (SaaStr) – a conference held annually in the USA.  All speakers at the Auckland conference were SaaS experts who shared how they contributed to, typically well-known, high growth companies. The key messages I gleaned were how crucial it is to nail product-market fit, find a niche within a niche, understand the personas of the target market and push hard in that direction with laser focus.

My highlights included Josh Robb, VP of Engineering at Pushpay, who shared how he built a high performing engineering team and lead the technical evolution of the Pushpay product suite. Pushpay provides a simple way to pay securely for things using a smartphone, and could have been tempted to go for a broad market, however, they took a targeted approached and focused on a large niche within a niche: US churches who accept tithings. Focusing on this niche and nailing product-market fit enabled Pushpay to grow from $1 million to $70 million in annual revenue in three years, and they’re only just getting started.

I also heard about how pricing can be very challenging for SaaS businesses. Marvin Liao (500 Startups) said rather than asking customers what they’ll pay for your product, test, research, and verify everything. Marvin said the business to business (B2B) software market is about three years behind the business to consumer (B2C) market. As B2B is slower to pick up new ideas systems and products, B2B can look at B2C for ideas.

Gareth Berry (Unleashed Software) talked about multi-dimensional pricing: annual fees, a la carte, or price on application only. This was interesting because it indicates that some businesses are moving away from standard monthly pricing and open pricing, as customers understand and value SaaS, in some cases they are willing to pay significantly more for it, especially at the enterprise level. Offering a menu of a la carte options is an interesting way to learn what your customers are willing to pay for and this can help inform your product development strategy.

If you are interested in learning more about developing capability in Product Management for your ICT business or you want to join others attending SaaStr 2019, then get in touch with me.

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