Transitioning from Legacy to SaaS
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Working with a net... or an anchor -- launching a SaaS application out of a legacy enterprise product
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Transitioning from Legacy to SaaS
- 1. Working with a net… or an anchor @timoliver47 #LegacytoSaaS #DENStartupWeek Launching a SaaS application out of a legacy enterprise product Tim Oliver Chief Product Officer
- 2. @timoliver47 #LegacytoSaaS #DENStartupWeek Pros Cons Culture & Talent Methodology & Systems Multiple product lines Experience & infrastructure Product market fit Cash flow
- 3. A Whole-Company Transformation @timoliver47 #LegacytoSaaS #DENStartupWeek Product Engineering Marketing & Sales Services & Support Finance
- 4. Features to support in each @timoliver47 #LegacytoSaaS #DENStartupWeek Customizations & one-offs? SaaSLegacy High-appeal features powered by new technology?
- 5. Imagine you have a blank slate @timoliver47 #LegacytoSaaS #DENStartupWeek Start with the new customer vision not with a legacy customer laundry list What can be added without sacrificing usability What can be made configurable? Minimize outright customizability
- 6. Architecture Transition Options @timoliver47 #LegacytoSaaS #DENStartupWeek Legacy Thin-Client On-Prem Combined Hosted
- 7. Additional Architecture Considerations @timoliver47 #LegacytoSaaS #DENStartupWeek • Integration changes • Reporting options • Single sign-on • Security • Certification requirements • End-to-end performance testing • Cloud vs. Managed Services vs. Colocation
- 8. @timoliver47 #LegacytoSaaS #DENStartupWeek Resource Allocation? Optional RequiredEncouraged Migration Strategy? SaaS Roadmap Planning Release Cycle? Legacy
- 9. Packaging & Pricing @timoliver47 #LegacytoSaaS #DENStartupWeek • Price to value, not to artificial conversion factors • Choose your volume driver carefully • Consider tax-table discount schedule • Bundling? Aim for the middle • Freemium? Measure opportunity plus support costs • Prioritize recurring over one-time costs • Term length? Monthly, annual, or multi-year? • Simplify and standardize contracts
- 10. Marketing @timoliver47 #LegacytoSaaS #DENStartupWeek Education Onboarding Sales No longer just about lead generation • Nurture throughout • Expose more • Measure everything Support Blurring lines with
- 11. Sales Methodology @timoliver47 #LegacytoSaaS #DENStartupWeek from “Elephant hunting to “Land and Expand” Investment in sales cycle Investment in growth
- 12. Pipeline Transition @timoliver47 #LegacytoSaaS #DENStartupWeek SaaS only Provide Options Legacy Only Mature Deals New Leads Developing Opportunities
- 13. Compensation @timoliver47 #LegacytoSaaS #DENStartupWeek What do you pay on? • Connect to LTV • Long-term contacts aren’t much more valuable • Use easy-to-grasp proxy metrics Pay up in the first year! • Yes, the percentages will go up • This isn’t insurance – resist the “book of business” approach • Over-communicate
- 14. Implementation @timoliver47 #LegacytoSaaS #DENStartupWeek • Strive for fast, standard deployments • Push configuration into the customer’s hands • Effective onboarding over extensive training • Learn to say “no” to customizations – maintain upgradability No Camping! Forget about PS as a profit center
- 15. Customer Support to Customer Success @timoliver47 #LegacytoSaaS #DENStartupWeek Product works Customer satisfied What customer wants Upsell opportunities Reactive Project successful Business benefits Best practices Growth & renewal Proactive
- 16. The Impact of Churn @timoliver47 #LegacytoSaaS #DENStartupWeek
- 17. Speaking of Financial Metrics @timoliver47 #LegacytoSaaS #DENStartupWeek • MRR vs ARR? • Modeling infrastructure & support costs • Determining customer acquisition costs • Predicting churn • Estimating LTV – don’t forget obsolescence • Prepare for cash flow dip
- 18. Overall Culture @timoliver47 #LegacytoSaaS #DENStartupWeek • Everything is part of the product • Consider user experience with every touch • Embrace agility throughout – get it out and iterate • Accelerate time to value • Customer success mentality • Collect data at every opportunity • Ingrain metrics in decision-making
- 19. Questions @timoliver47 #LegacytoSaaS #DENStartupWeek Contact me: Tim Oliver tim@covalentdata.com toliver@writepositioning.com www.linkedin.com/in/timoliver47 https://twitter.com/timoliver47
Editor's Notes
- How many in room: Have or are transitioning from legacy to Saas Have worked with legacy on prem apps Have worked with saas apps Roles in audience: product? Engineering Sales Marketing Finance Cust success Talking from my research & experiences Assumption that not ripping bandaid off all at once; assume decision is made – this isn’t about pros/cons of doing it YMMV
- Legacy on prem: reduce code base branching Combined: give SaaS access to some new features for legacy customers Hosted: Maintain some customizability with single tenant hosted solutions
- When are you ready for existing customers? You know it’s stable When do you want to provide incentives? Have good migration tools in place Cost benefit What kinds of incentives? Reduced subscriptions? Waived PS fees? When do you want to end-of-life? Better to lose remaining maint revenue
- Traditional mindset is to herd all the cats in the enterprise for a single bite at the apple. With SaaS, the sales cycle must be shortened.
- Present options too early and you risk delaying sales Present too late and you may end up with disgruntled and/or difficult to migrate customers