Think You're Ready for SaaS? Think Again! - 9 Common SaaS Misconceptions to Avoid

Think You're Ready for SaaS? Think Again! - 9 Common SaaS Misconceptions to Avoid - Presentation Transcript

Originally presented at SoftwareCEO Software University 11/12/2009 Think you're ready for SaaS? Think again! http://saasrevenue.com Copyright© 2009 Sixteen Ventures / Lincoln Murphy. All Rights Reserved

For the record... I’m a big fan of SaaS Many more beneﬁts to All of the known end- the SaaS vendor & end user reasons user due to Network Effect Allows end-users to Business Scalability for focus on business both the vendor & the problems not tech client http://saasrevenue.com Copyright© 2009 Sixteen Ventures / Lincoln Murphy. All Rights Reserved

Why does it matter if you know what SaaS is? Revenue Modeling, SaaS vendors take on Generation, and all of the burden for Recognition are more their clients complex One code-base serves All aspects of SaaS multiple markets differ from Legacy without modiﬁcation Software; sales, & with an in-built software dev, etc. revenue model http://saasrevenue.com Copyright© 2009 Sixteen Ventures / Lincoln Murphy. All Rights Reserved

If you think SaaS is... 1. Just another software delivery model 2. A way to deliver cheap software 3. A market 4. Another name for subscription pricing 5. Anything in “the cloud” 6. An easy sale: If you build it, will they come? 7. Just another version of your software 8. Right for your ﬁrm since everyone else is doing it 9. A ticket to easy success w/ the right checklist http://saasrevenue.com Copyright© 2009 Sixteen Ventures / Lincoln Murphy. All Rights Reserved

SaaS is not... just another software delivery model Single-Instance, Web-Native Multi-Tenant About Rules, Unique Business not Exceptions Architecture http://saasrevenue.com Copyright© 2009 Sixteen Ventures / Lincoln Murphy. All Rights Reserved

Legacy Software Business Structure Intellectual Marketing Property Revenue Technology Model Loosely-coupled, at best http://saasrevenue.com Copyright© 2009 Sixteen Ventures / Lincoln Murphy. All Rights Reserved

SaaS Business Architecture Intellectual Marketing Property Network Centricity Technology Revenue Model All aspects are tightly coupled http://saasrevenue.com Copyright© 2009 Sixteen Ventures / Lincoln Murphy. All Rights Reserved

SaaS is not... a way to deliver cheap software SaaS has the potential SaaS doesn’t have to to provide more be “Software-Lite” value than on-prem Vendor takes on Maybe SaaS should burden of infra, cost more than governance, Legacy Software due compliance, etc. to value-add http://saasrevenue.com Copyright© 2009 Sixteen Ventures / Lincoln Murphy. All Rights Reserved

SaaS is not... a market The market is the SaaS is a Business vertical, industry, etc. Architecture who will buy your offering Don’t model your Competitors, SaaS or product, pricing, etc. not, drive market after other SaaS expectations. offerings outside of Are you in a position your market to challenge those? http://saasrevenue.com Copyright© 2009 Sixteen Ventures / Lincoln Murphy. All Rights Reserved

SaaS is not... another name for subscription pricing SaaS is not another Subscriptions are only name for subscription 1 of 7 Revenue pricing Streams Even within Subscriptions there Key is to be aligned are many options: with your market Metric/Timeframe http://saasrevenue.com Copyright© 2009 Sixteen Ventures / Lincoln Murphy. All Rights Reserved

SaaS Revenue Modeling Intellectual Products Marketing Property Subscriptions Ecosystem Network Network Centricity Effect Services Advertising Revenue Technology Model Ancillary Revenue Model consists of Revenue Streams http://saasrevenue.com Copyright© 2009 Sixteen Ventures / Lincoln Murphy. All Rights Reserved

Revenue Model is not Pricing Strategy Revenue Pricing separate Model Strategy Revenue Model + Vertically Aligned Pricing = Agility http://saasrevenue.com Copyright© 2009 Sixteen Ventures / Lincoln Murphy. All Rights Reserved

SaaS is not... anything in the cloud Single-instance Web Just because its on the Apps, ASP, Cloud web doesn’t make it servers, private SaaS clouds, etc. are not SaaS PaaS, IaaS, API-based systems probably SaaS is UI Agnostic meet deﬁnition of SaaS http://saasrevenue.com Copyright© 2009 Sixteen Ventures / Lincoln Murphy. All Rights Reserved

SaaS is not... an easy sale; if you build it, will they come? Are there channels? Some companies, Know your market industries, regions, etc. only buy through 3rd parties. Period. The sales department On-boarding, is not obsolete no implementation, matter how much you integration & change want that to be the management are still case real issues http://saasrevenue.com Copyright© 2009 Sixteen Ventures / Lincoln Murphy. All Rights Reserved

SaaS is not... just another version of your software Hybrid is hard! So much more than Organization issues, managing “two technology problems, branches of source etc. code” One-off versions break the SaaS model Customization is the & its eliminate many death nell of a SaaS of the beneﬁts to both vendor the vendor & client http://saasrevenue.com Copyright© 2009 Sixteen Ventures / Lincoln Murphy. All Rights Reserved

SaaS is not... the right move since everybody else is doing it Is your organization Is your market ready? ready? Internal structural, Market culture, laws/ cultural, & ﬁnancial governance, and challenges can kill a mindset must be SaaS business before it aligned starts http://saasrevenue.com Copyright© 2009 Sixteen Ventures / Lincoln Murphy. All Rights Reserved

SaaS is not... a ticket to easy success with the right checklists Might be good at 60k There is no silver foot level bullet Blanket statements about different Every company & businesses in different market is different markets are usually not valid http://saasrevenue.com Copyright© 2009 Sixteen Ventures / Lincoln Murphy. All Rights Reserved

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 http://saasrevenue.com