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GOLD! Ask Me Anything About SaaS ( I'm building my 7th )

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alexkuzmov

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Hello everyone.

A lot of you know me for my digital marketing Gold Thread here on the FLF ( see sig ), as well as other posts in the forum.

What you might not know is that I've successfully built 6 profitable SaaS programs either solely by myself, or with a single partner ( and with no other employees other than VA's ), and that I am working on building my 7th SaaS

I've learned a few things in SaaS over the last 7 years that span:
  • Handling competitors
  • Reducing churn
  • Fraud reduction
  • Technology for SaaS needs
  • Big Data ( billions of new data points daily over years )
  • Increasing LTV
  • APIs
  • Pricing
  • Onboarding
  • Project management
  • Marketing
  • Customer service
  • Partnerships
  • Customer demos/profiles, MVPs, UVP's, ahHa moments, etc
  • many many more things

I've focused all my SaaS programs in the digital marketing space, but I have some ideas for new SaaS programs expanding outside of that for the future.

I can't answer questions related to:
  • Legal - please seek an attorney
  • Specific finance questions about my current or past SaaS programs - I'm not going to divulge other than generalities to the public. I can verify for a mod though if needed.
  • Info on verticals outside of digital marketing - meaning if you have a SaaS for doctors and you ask me a specific medical question, I won't know it if it pertains to doctors or medical
  • LLC vs Scorp Vs etc - This is legal
  • How long is a piece of string type questions

And before anyone asks.. NO, not all 6 SaaS are currently running right now. I closed down the first 5 over the years at different times due to either partner problems or interest died off for me and I rolled into the next SaaS combining ideas to make something new.

For clarification, I am running 1 active SaaS right now and building another ( the 7th ) that is not public atm since it is not finished.

Ask away!


P.S. - Listen, I'm a different type of person. I have very unique views that don't always fit the norm you might have heard elsewhere. What I tell you is what has worked for me and the way I see things from my own personal experience. There are many ways to skin a cat. If you don't agree, that's cool but always think things over for yourself and what will work for you.

.
Hey @eliquid I`m Alex, a software engineer, I`m also currently working on as SaaS platform with friends of mine, trying to get it off the ground. The platform is used for e-commerce.
I wanted to ask you a couple of questions related to clients.
About a month ago we finally had our hard proof and received the first payment from a client.
Right now we have a couple of clients but we are still losing money because of expenses for hosting, legal stuff and so on.
We have a chance to break even if we sign a client who is willing to work with us, lets call him G.

We`ve been trying to get G.`s stuff ready, changing design, adding functions, adding products, adding payment methods etc.
Initially we had agreed on a monthly payment but we added alot of stuff for him and alot more products than he wanted in the begining.
One of my colleagues met G. on monday and felt that G. might be shady.
He felt that G. has been playing us and might be a bad client, meaning that we`ll have legal and other problems if we work with him.

My questions are:

1. Have you dealt with bad clienst which threaten your business?
2. Should we try and avoid such clients, even on a gut feeling?

Any advice would be much appreciated
 

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eliquid

eliquid

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Hey @eliquid I`m Alex, a software engineer, I`m also currently working on as SaaS platform with friends of mine, trying to get it off the ground. The platform is used for e-commerce.
I wanted to ask you a couple of questions related to clients.
About a month ago we finally had our hard proof and received the first payment from a client.
Right now we have a couple of clients but we are still losing money because of expenses for hosting, legal stuff and so on.
We have a chance to break even if we sign a client who is willing to work with us, lets call him G.

We`ve been trying to get G.`s stuff ready, changing design, adding functions, adding products, adding payment methods etc.
Initially we had agreed on a monthly payment but we added alot of stuff for him and alot more products than he wanted in the begining.
One of my colleagues met G. on monday and felt that G. might be shady.
He felt that G. has been playing us and might be a bad client, meaning that we`ll have legal and other problems if we work with him.

My questions are:

1. Have you dealt with bad clienst which threaten your business?
2. Should we try and avoid such clients, even on a gut feeling?

Any advice would be much appreciated
I can't say I have had bad clients that I thought threatened my business. However, I have had shady or bad clients in general and I always dump their asses when I get the gut feeling. So if I can dump them before I think they will threaten me, then I am going to say the same for you if you think your's will. Because I'm dumping them at the first or second feeling of them just being bad.

I have had though, bad partners in my business that I felt were shady and could threaten the business or me personally. People I have known for years as a "client" and then later went into business with only to find out more about them once we partnered. I struggled to end that ASAP and it caused me stressed until we finally legally parted ways. Yes, you must absolutely get away from people like this no matter if they are a partner or a client of yours.

If your product is great, you will not have issues finding another client.

.
 

alexkuzmov

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I can't say I have had bad clients that I thought threatened my business. However, I have had shady or bad clients in general and I always dump their asses when I get the gut feeling. So if I can dump them before I think they will threaten me, then I am going to say the same for you if you think your's will. Because I'm dumping them at the first or second feeling of them just being bad.

I have had though, bad partners in my business that I felt were shady and could threaten the business or me personally. People I have known for years as a "client" and then later went into business with only to find out more about them once we partnered. I struggled to end that ASAP and it caused me stressed until we finally legally parted ways. Yes, you must absolutely get away from people like this no matter if they are a partner or a client of yours.

If your product is great, you will not have issues finding another client.

.
Thank you for the advice.
We`ll see how it goes with G., since there are four of us, we are two on two on the issue.
Because of the time investment we`ll give him the benefit of the doubt, hopefully it turns out OK.

Do you have any advice on onboarding new clients?
How do you entice them to try out the SaaS platform? Discount, extended free trial? Free changes and/or product transfer?
We`re new to this so we`re kind of unsure how to convince a client to try us out.
Should we set some boundries? For example, 3 month free trial but only if there are few to no sales.
If there are X sales per week then initiate payments after only 1 month?
 
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eliquid

eliquid

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Thank you for the advice.
We`ll see how it goes with G., since there are four of us, we are two on two on the issue.
Because of the time investment we`ll give him the benefit of the doubt, hopefully it turns out OK.

Do you have any advice on onboarding new clients?
How do you entice them to try out the SaaS platform? Discount, extended free trial? Free changes and/or product transfer?
We`re new to this so we`re kind of unsure how to convince a client to try us out.
Should we set some boundries? For example, 3 month free trial but only if there are few to no sales.
If there are X sales per week then initiate payments after only 1 month?
You won't like my answer.

If you really have to discount or do free stuff, you are not adding enough value in your product and messaging to win the client over.

I totally get why and what you are doing. Been there and done that.

But having to discount and do free anything is basically winning people by competing on price. And competing on price is always a race to the bottom. Trust me when I say that there will ALWAYS be someone willing to do more for free once you do it.

I would spend more time on making sure your product is valuable to a potential client. You may think it already is, but if it was you would have people beating down your door. A heart surgeon doesn't need to advertise much if I have a heart condition and need help.

Instead of focusing on price, focus on value.

In SERPWoo, our lowest price is $49 a month. Many people say they can't afford it. Instead of lowering price, I add on more benefits. At some point SERPWoo will be so valuable, people will be able to magically afford $49 for what they are getting.

Today, I just launched a new feature in SERPWoo for our paid customers where they can monitor the internet for their brand keywords. It doesn't cost them anything extra. Once they start using it, it adds more value to their lives. They won't want to quit once we solve a lot of their problems like this.

I did this without having to lower my price.

You also need to focus on your message. Once you know what your customers really want, you will be able to hit their pain points and speak their language. Once you do that, you won't have to do anything for free or discount.
.
 
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eliquid

eliquid

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If you are in authority in your topic that your SaaS is in, you know where your customers are.

Drink at the same waterholes as they do.

If you have to dip into PPC at the beginning, you are doing it all wrong.

You gotta create word of mouth. Once you do that, add on PPC or other tactics to keep the fly wheel moving faster.

.
 

Jon L

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I have a rudimentary point of sale system that I built as a custom solution for one client. I'm considering selling it to other similar clients. The problem is that I built it as a single-client solution, with no consideration for making it multi-tenant. Changing it to multi-tenant would take a fair amount of work, work that really needs to go into other essential features.

Its super-simple to create a new database and copy the code to a new folder to set up a new client, so that is pretty appealing. If we got to 100 clients, this would be unwieldy, but, we would be a $1m/year business at that point, so we'd have the cash to manage it, especially with overseas employees.

I think I'm making the right decision to not focus on problems I don't have yet, but wanted your take on this.
 

Clueless Newbie

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The problem is that I built it as a single-client solution, with no consideration for making it multi-tenant. Changing it to multi-tenant would take a fair amount of work, work that really needs to go into other essential features.

Its super-simple to create a new database and copy the code to a new folder to set up a new client, so that is pretty appealing. If we got to 100 clients, this would be unwieldy, but, we would be a $1m/year business at that point, so we'd have the cash to manage it, especially with overseas employees.
I spent my last few weekends changing a single client solution into a multi-client solution. In my case, I was able to get away with doing lots of database changes and few coding changes.

Could you do something similar? May be you can find a creative way to change the database side and minimal changes in the code files or vice versa. If the product takes off, then invest some money back into making it a true multi-client solution.

I'm curious to hear @eliquid the answer on this as well.
 

Jon L

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I spent my last few weekends changing a single client solution into a multi-client solution. In my case, I was able to get away with doing lots of database changes and few coding changes.

Could you do something similar? May be you can find a creative way to change the database side and minimal changes in the code files or vice versa. If the product takes off, then invest some money back into making it a true multi-client solution.

I'm curious to hear @eliquid the answer on this as well.
the other thing that copying and pasting for new clients is the ability to easily customize each client's system without having to be so formal about versions, etc.

What you said about the database, though, has me thinking. I believe I could create views that reference the ID number of the client and leave just about everything else alone. There wouldn't be much to change in the code to accommodate that.
 
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I have a rudimentary point of sale system that I built as a custom solution for one client. I'm considering selling it to other similar clients. The problem is that I built it as a single-client solution, with no consideration for making it multi-tenant. Changing it to multi-tenant would take a fair amount of work, work that really needs to go into other essential features.

Its super-simple to create a new database and copy the code to a new folder to set up a new client, so that is pretty appealing. If we got to 100 clients, this would be unwieldy, but, we would be a $1m/year business at that point, so we'd have the cash to manage it, especially with overseas employees.

I think I'm making the right decision to not focus on problems I don't have yet, but wanted your take on this.

Money can solve a very large amount problems.

This is how I look at things as well.

So copy + paste DBs for each client so you can see if this scales and works. Once you obtain enough money, hire someone else to fix it for you while you keep scaling.
 

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jeandearme

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the other thing that copying and pasting for new clients is the ability to easily customize each client's system without having to be so formal about versions, etc.

What you said about the database, though, has me thinking. I believe I could create views that reference the ID number of the client and leave just about everything else alone. There wouldn't be much to change in the code to accommodate that.
Yes, I don't think either you need more than one database now. Of course, if you wanted to stick to it you can make you backend create new database, but then you would need another database to store users credentials... Take one evening to read about data structuring in databases. You will have a lot of questions answered. Also, use StackOverflow - essential tool for developers today.

What I haven't seen a lot here when it comes to programming things on your own is code structure/architecture. Keyword here is: modularization. If you keep code in separate, yet small chunks of code that has only one responsibility you will have so much more easier time scaling, adding new features, changing existing ones. It keeps your code more readable and easier to reason after couple of months (important!).
 

Jon L

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Yes, I don't think either you need more than one database now. Of course, if you wanted to stick to it you can make you backend create new database, but then you would need another database to store users credentials... Take one evening to read about data structuring in databases. You will have a lot of questions answered. Also, use StackOverflow - essential tool for developers today.

What I haven't seen a lot here when it comes to programming things on your own is code structure/architecture. Keyword here is: modularization. If you keep code in separate, yet small chunks of code that has only one responsibility you will have so much more easier time scaling, adding new features, changing existing ones. It keeps your code more readable and easier to reason after couple of months (important!).
my question is more about what it makes sense to invest in vs how to do it. Until I get a few more paying customers, its not worth spending any time changing things. We've done quite a bit of QA work on the product as-is. Changing up the system so that its multi-tenant, even if I use some database tricks, will require a lot of regression testing. Like eliquid said, money solves a lot of issues. When we have lots of paying customers, I can redesign my system to be multi-tenant.

That said, I know of a company here in the Seattle area that has 600 customers for their point of sale system, each on their own separate code base & database. That's messy. But, they run the thing with only two well-paid ($150k/year) developers, and are raking in the cash. Could they scale that out to 100s of thousands of customers? Nope. But, who cares? They dominate their niche.
 

jeandearme

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my question is more about what it makes sense to invest in vs how to do it. Until I get a few more paying customers, its not worth spending any time changing things. We've done quite a bit of QA work on the product as-is. Changing up the system so that its multi-tenant, even if I use some database tricks, will require a lot of regression testing. Like eliquid said, money solves a lot of issues. When we have lots of paying customers, I can redesign my system to be multi-tenant.
Hmm, but to have more than one paying customer you have to be able to give them access - and to give them access you need money (if going with that scenario). Looks a bit like a loop unless they pay upfront and give you a month so you can redesign system. Maybe there is yet another quick and dirty solution just so you can take customers aboard and redesign on the fly?
 

Jon L

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Hmm, but to have more than one paying customer you have to be able to give them access - and to give them access you need money (if going with that scenario). Looks a bit like a loop unless they pay upfront and give you a month so you can redesign system. Maybe there is yet another quick and dirty solution just so you can take customers aboard and redesign on the fly?
yeah, so the way this will hopefully work:

1) Sell the POS system to a client for something on the order of $10k. Also, collect revenue from credit card transactions processed through the system.
2) for this client, copy the existing code to a new directory in the server. Create a new database on SQL. Point the copied code to the new database
3) Configure system for this new client (configure all their users, locations, part numbers, reports, etc)
4) Repeat with a new client.

Once we get enough clients, we'll have some significant recurring revenue from credit card fees. With that, we can continue to build out the system for the clients. That may or may not include making it multi-tenant.
 
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yeah, so the way this will hopefully work:

1) Sell the POS system to a client for something on the order of $10k. Also, collect revenue from credit card transactions processed through the system.
2) for this client, copy the existing code to a new directory in the server. Create a new database on SQL. Point the copied code to the new database
3) Configure system for this new client (configure all their users, locations, part numbers, reports, etc)
4) Repeat with a new client.

Once we get enough clients, we'll have some significant recurring revenue from credit card fees. With that, we can continue to build out the system for the clients. That may or may not include making it multi-tenant.
This is exactly how to do it.
 
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What I haven't seen a lot here when it comes to programming things on your own is code structure/architecture. Keyword here is: modularization. If you keep code in separate, yet small chunks of code that has only one responsibility you will have so much more easier time scaling, adding new features, changing existing ones. It keeps your code more readable and easier to reason after couple of months (important!).
This was done on purpose. Everything has a time and place.

1. No one has brought this up in the thread, so it didn't have its time yet

2. This forum is filled with more entrepreneurs than developers, so this hasn't really had its place yet

I know a ton of developers who don't do anything else ( they don't do marketing, they aren't really business people, they don't do sales or other things ) and this typically is how they think and what they do.

Is it wrong? Of course not. But again, everything has its time and place.

And the time and place for pretty and well-factored code is not at the start/beginning. These are problems for developers to solve, not entrepreneurs trying to prove an MVP or get their first 20 clients.

No need to plan to scale if you can't validate in the market and don't have money to hire employees to change the code while you get more clients.

Once you have money and things sorted out, then you can hire developers whose job it is to properly factor out the code and scale-out the DB.

This idea may pivot 3 more times before it's profitable. Trying to perfect the code base on each will be a huge waste of time, at this moment.

Just validate and get sales. Hire others to fix your mistakes when it takes off.

A perfectly written business plan, pretty code, sound database, and backups of backups are worthless if it doesn't get customers and that's a lot of wasted time by the time you realize that.

Sales can pretty much cure all.

.
 
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Where can i find a good coder for my saas . Thank you
This isn't really answerable.

It's like asking where to find a good spouse kinda. You just gotta kiss a lot of frogs until you find a good one.

Past that, you can start someplace like Upwork or Craigslist getting in proposals from experienced devs.
 

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