SaaS Business Architecture:
Definition - Updated 9/25/2009
http://saasbusinessarchitecture.com Copyright© 2009 Sixteen Ventures / Lincoln Murphy. All Rights Reserved

Conventional SaaS Definitions
“a model of software deployment
“…software that’s developed and hosted
whereby a provider licenses an application
by the SaaS vendor and which the end user
to customers for
customer accesses over the Internet. ”
use as a service on demand.”
- CIO.com
- Wikipedia
“…subscription based, and all upgrades are
provided during the term of the subscription. […]
is hosted and updated on a central location, and
does not reside on client computers.”
- Utah.gov
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Problem...
Most conventional definitions of
SaaS are meaningless to vendors
and result in industry-wide
misunderstandings and confusion
http://saasbusinessarchitecture.com Copyright© 2009 Sixteen Ventures / Lincoln Murphy. All Rights Reserved

Solution...
Stop trying to fit legacy
Eliminate legacy artifacts and
models into a modern
start with what works
model
Clearly delineate SaaS and its Introduce the SaaS Business
defining characteristics Architecture
http://saasbusinessarchitecture.com Copyright© 2009 Sixteen Ventures / Lincoln Murphy. All Rights Reserved

SaaS Business Architecture
Intellectual
Marketing
Property
The SaaS Business
Architecture is a Network-
Network centric commingling of
Centricity Marketing, Intellectual
Property, Technology,&
Business Model
Technology Business Model
http://saasbusinessarchitecture.com Copyright© 2009 Sixteen Ventures / Lincoln Murphy. All Rights Reserved

Marketing
Unique value proposition for
Inherently Social
both vendor and clients
Reduce barriers to
Self-Service focus
adoption
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Intellectual Property
Core Application Proprietary Functionality
Cannot be the only focus of Create value beyond the
developers core application
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Technology
Self-Service, network-
Single Instance, Multi-Tenant
centric, and ecosystem
in Production
focused
Forking code for one-off
clients breaks the model; Web-native, UI agnostic
inbuilt flexibility is key
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Business Model
Metering, Billing internal to
Inbuilt Revenue Model
Application
Leverages many of the 7 Should be driven by quest
Revenue Streams available for Business Scalability
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7 SaaS Revenue
Streams
Products
Subscriptions Ecosystem
Network
Effect
Services Advertising
Ancillary
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Network Centricity
Producers Consumers
Network
Effect
Ecosystem
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Get the detailed guide to the
7 SaaS Revenue Streams with examples:
http://saasrevenue.com/7streams.html
If this is a SaaS Revenue Model emergency
put down the mouse and call us:
(972) 200-9317
Copyright© 2009 Sixteen Ventures / Lincoln Murphy. All Rights Reserved