Maybe you have that itch again.
Or maybe you’re looking to monetize some strategic software as a service.
You’re soon going to be grappling with an important question, “How do I make sure it sees success?”
SaaS, however, is the rare exception where I’ve found that thinking through both topics as a business exercise will not only get your strategy moving in the right direction, but set you up for success.
If you’ve fallen down the wrong algorithm hole on Instagram or Tik Tok, you’ve likely stumbled upon tech bros talking about SaaS theory. There’s a lot out there.
I’ve boiled the most-popular theories into the top five I think are most helpful at giving you a solid start.
“Find the empty ocean, not the bloody battlefield.”
Create an entirely new category or drastically change the value proposition so that you have little or no competition.
When to Build SaaS
Real-world Examples
I’d argue a lot of Blue Ocean ideas tie closely with Second Mover Advantage. But for the sake of demonstration here, Airbnb saw everyone’s home as a “hotel.”
No one had done that effectively before.
Questions to Ask Yourself
“Catch the right wave — don’t try to swim against it.”
Build when a major behavior or tech shift starts — but before it’s obvious to everyone.
When to Build SaaS
Real-world Examples
You can leverage this when things are proven modern trends (unlike Platform Shift which is more predictive and a gamble).
Obviously, AI is the absolute king and everyone from CPAs to lawyers are looking to capitalize.
Just be careful, there might already be too many people clogging the pipeline, so you’d better have a different angle.
Questions to Ask Yourself
“Be smarter, not first.”
Take an existing SaaS idea and improve it dramatically.
When to Build SaaS
Real-world Examples
For the SaaS play, Basecamp and Trello were the original royal family of online project management. People obviously wanted more, which led to the insane rise of dozens of others that are all now multi-million dollar companies.
How did they do it?
And you could argue that (non-SaaS) companies like Airbnb and Uber were technically also leveraging this tactic.
Back in the day, Taxis were the only option. And they had quite a mixed reputation.
Hotels? Overpriced and underwhelming in most cases.
Key Moves
Use the “Skyscrapering” Technique
It’s not just a metaphor — it actually happened.
Back in the early 1900s, cities like New York and Chicago were blowing up. Everyone had money, everyone wanted attention, and the only thing that mattered was who could build taller. It kicked off this ridiculous arms race where one dude would throw up a building, and almost immediately someone else would come along and say, “Cool… but what if mine was twenty feet taller?”
This technique is super popular in SEO:
How does this apply to SaaS?
Warning
If you’re going to do this, damn it, you better actually do it better.
“When the ground moves, build for the new ground.”
Major technology shifts create brand new SaaS opportunities.
When to Build SaaS
Real-world Examples
Frankly, this one is hard and risky. Maybe what you thought was going to be the next big trend was the equivalent of a Zeplin.
Looking back now, AI is a very obvious winner.
Key Moves
Questions to Ask Yourself
“When supply is low, even a basic solution can dominate.”
When clear demand exists but few or no good tools are available.
When to Build SaaS
Real-world Examples
Key Moves
Questions to Ask Yourself
Just Be Careful
You might soon be the victim of second movers. So make sure you continue innovating, always.
Yeah, I kind of hate the entire philosophy behind this “why” movement. But it really does bring tangible value to building and marketing a SaaS product.
Were you having problems — or seeing gaps – in the industry you’re familiar with?
You might accidentally stumble on the answer here and go back and find a theory that aligns with your thinking.
Or you’ll pick a theory first and go from there.
This is a very key question, and should relate to your ideal customer. Higher price points often bring less, but larger-sized companies.
Maybe you’re not looking to be the gas station coffee of your industry. Or maybe you are. It’s key to know your end goal in terms of customer count and revenue goals associatively.
Or maybe you just invested in greater tech and have higher overhead.
We get asked a lot about lower pricing plans. Maybe one day when we’re bigger we’ll offer it.
But for now, we know we’ve invested in the best tech available to drive the core of the product, and we’re looking for sites and organizations that can afford the benefits we bring. We’re not looking to host every WordPress site in the world, and that’s alright.
There’s another question to ask here: why do you get X for that price?
This should relate to your core mission, and it will drive the places you buck trends. The functions should relate to this directly.
Take us for example. We decided to make a Static WordPress Generator, but we bucked certain trends:
This is a constant question that should drive UI, revisions, and new features. It’s a question to never stop asking, and one to drive with competitive analysis and customer feedback.
About the Author
Ben Butler is founder and lead developer of Headless Hostman, and the owner of Top Hat — a design and web agency.
About SaaSwatch
Our diary of building SaaS and the diary of others building their’s.