Founding a SaaS company can be a remarkable challenge that pays off if you get everything right. Unfortunately, many first time SaaS company founders make the same couple of mistakes that can undermine their business before they even get started. If you want to have a successful SaaS company, then you have to avoid making these same mistakes. In this article, we discuss the five biggest mistakes that you can make when founding a SaaS company.
Not Investing Enough in Resources
One mistake that new business owners make is not investing enough in resources. When you are first starting out, funding is limited. Most new business owners do not have access to large amounts of cash to fund the acquisition of new resources. Because of this, it can be tempting to spend as little as possible on resources.
In a SaaS company, not spending enough on the resources that you need stops the business from gaining momentum. Your business needs specific resources to be able to provide high-quality services to your customers. If the customer experience suffers because of the resources that you have available, then your company will lose customers and struggle to stay open.
Failing to invest in resources and infrastructure that can help your company grow over time can also put your company at risk. Although most SaaS products and services are easily scalable with a minimum of resources, this does not mean that you will not have to acquire new resources as your company grows. You also have to be mindful of the fact that the resources that you have available early in your business development may not be the best options for your company. Spend the time, effort, and money to get the resources that you need to provide a service that customers want. There are resources for every price range, and it is a matter of finding the right one for your business at the time.
Hiring the Wrong Team
The most important part of starting your SaaS company is hiring the right team to help you. When you start a business, you’ll quickly realize that you cannot do everything by yourself. However, hiring a team is more complicated than you may think. Picking the wrong people will not only slow your business growth but could also prevent it entirely.
The reason why founders struggle with hiring is because it is difficult to determine who is the best fit for a position within the company. It is worth the time and investment to try to improve your hiring process. While it may seem like a good idea to hire a person with a lot of success in his or her career, that person may not be the best fit for your company. Focus on finding people who are committed, skilled, and are easy for you to work with. By identifying the key characteristics that you need in a company leader before beginning your search, the process becomes much easier over time.
As the founder and CEO of the company, you will likely be involved in every aspect of the company. Unfortunately, you will not be able to manage every aspect of the project. Instead, you will have to delegate to your staff. Continuing to maintain a high level of control after delegating work to your staff becomes unnecessary micromanaging.
Micromanaging is a consistent problem with new businesses because the founders are unable to delegate and focus on other things. This also leads to problems with staff members and being able to trust your team to do work. Learn to pick strong team members and delegate to avoid problems with micromanaging.
Letting Imposter Syndrome Hold You Back
Imposter syndrome happens when you get the feeling like you are not qualified to lead your business. This is a common problem for new business owners, but it can be prevented with the right type of focus. Letting imposter syndrome stop you from running your business effectively means that you will never reach the point where you feel like you are doing a good job. Instead of being worried about being qualified to do your job, focus more on doing your job. Eventually, the feeling of being an imposter will pass as your company begins to find its footing.
Offering Too Much to Too Many People
When people develop businesses, they often want to offer a collection of services because they believe it will make them more likely to be successful. This is often not the case, especially in SaaS companies. Offering too much in the way of services means that your company must be prepared for a lot of different kinds of work. This makes it difficult to build a specialized and reliable infrastructure that is needed to do the work that will make your company successful. Likewise, focusing on a wide target audience also makes it difficult to specialize and connect with the potential customers that will keep your company going.
When first starting out, it is often best to focus on a small niche where you can find reliable customers. This is becoming more of a trend with micro-SaaS companies developing services targeted at fixing one or two very specific problems. Limit your offerings and who you offer them to to make sure that you can provide high quality and reliable service to an easily identifiable group of potential customers. That enhanced focus will make it easier for you to connect to your target audience and get a foothold in the industry.
Work with Professionals to Improve Your Services
Starting a SaaS company can be a rewarding process, but there are many problems to avoid if you want to be successful. At KitelyTech, we work with companies to establish their SaaS operations and can help you with a variety of needs. Call us at (312) 254-8248 to learn more about our SaaS services.