Want to start your own SaaS company?
Do it. It is hard, harder than you can imagine. But if you do it right, and for real — it can last 30+ years.
If you haven’t done it before, though, here’s my list of the top 9 things founders get wrong before they start:
- It almost always takes at least 24 months to get really off the ground from Day 1. Almost no one budgets enough time, and founders quit before it even really has a chance to get off the ground. More here: If You’re Going to Do a SaaS Start-Up … You Have to Give it 24 Months | SaaStr
- VCs do not fund very many companies — even today. Fundraising is a complex, nichey, weird art and science. The #1 thing most founders don’t get is most VCs don’t actually fund very many companies. At medium-sized funds, each partner often does 2 investments a year. And often just 1 a year at bigger funds. Even in seed funds, each partner often just does 3–4 investments a year. Why will you be that 1? If you don’t know — you won’t get funded. A bit more here.
- You can’t hire some magic salesperson to “get you more sales”, at least not at first. You have to figure it out first yourself. The answer to your problems is not a magic salesperson. Once you have 10, 15, 20 customers … you can hire someone to help. But the magic will be implementing the playbook you already figured out, just full-time.
- Freemium is not a marketing strategy. Just because your product is free, or has a free category, does not mean anyone will find it. Freemium is a funnel management strategy and done right, later it can accelerate viral acquisition. But putting up a new, free product on its own will get you zero customers.
- If your co-founder is not as committed as you, he/she will leave, and before it really takes off. It’s not worth it, or at least it’s almost never worth it.
- Slow growth after a certain point is a sign of a lack of product-market fit. If after say $8k-$10k in MRR you are still growing slowly, you don’t have true product-market fit … even if the customers you do have are happy. You need to iterate more. You may be close, but you don’t really have a product the market is demanding. Not yet.
- First-to-market matters, but so do many other things. Focus instead on being first to do something important 10x better. Mailchimp was not the first email tool. Qualtrics was not the first survey tool. Asana was not the first project management tool. You need to be 10x better at something important. Be first-to-market on that. More here: On Not Forgetting to be 10x Better | SaaStr
- VCs are not out to get you. I’ve had some rough experiences with VCs, but VCs are not out to fire you, steal your company, etc. They are out to invest $1 and make $10 or more … by your growing like a weed. When that doesn’t happen, issues prop up. But VCs do not want to take over your company or fire you. They want to go skiing and do triathalons and see their capital grow with little work. Ideally.
- You don’t have to spend 100 hours a week in the office. But … Work-life balance is a myth. I’m sorry. You don’t have to work in the office 100 hours a week to make your start-up a success. Not at all. But you will need to obsess about it 24×7. The best CEOs and founders all do. On vacation. In the shower. On a run. When you are playing with your kids. Obsession about making it better will always be on your mind. This is stimulating, validating, and interesting. It also changes you. Forever.
(note: an updated SaaStr Classic post)
Published on November 12, 2021
Source: https://www.saastr.com/9-things-first-time-founders-get-wrong-about-the-journey/
- 100
- 2019
- 9
- acquisition
- All
- Art
- BEST
- Bit
- Campaign
- capital
- Co-founder
- Companies
- company
- Customers
- day
- etc
- Experiences
- Figure
- Fire
- First
- fit
- Focus
- founders
- Free
- fund
- funded
- Fundraising
- funds
- Grow
- Growing
- Growth
- here
- hire
- HTTPS
- Investments
- issues
- IT
- kids
- List
- Making
- management
- Market
- Marketing
- Matters
- months
- Other
- partner
- Product
- project
- project management
- Run
- SaaS
- Science
- seed
- So
- spend
- start
- Start-up
- Strategy
- success
- Survey
- time
- top
- vacation
- VCs
- weed
- week
- Work
- Work-Life Balance
- worth
- year
- years
- zero
More from SaaStr
Why 2024 May Be Tougher on Venture Capital Than 2023 | SaaStr
Source Node: 2455999
Time Stamp: Jan 25, 2024
Want Happy Customers? Implement the 5-Visits-Plus-2-Badges Rule. For Your Customer Success Team — And You. (Updated)
Source Node: 1959020
Time Stamp: Feb 14, 2023
SaaStr Annual 2022: Outdoors Again, Festival Style Again, All Kinds of Awesome
Source Node: 1576043
Time Stamp: Jan 11, 2022
Your Variable Comp Plans for Next Year: More Are Better
Source Node: 1564241
Time Stamp: Nov 17, 2021
How Many 1000s of Top Vendors There Are In Each Core Category. 1000s. | SaaStr
Source Node: 2337495
Time Stamp: Oct 19, 2023
SaaStr Podcast 451: How Leveraging Partnerships Can 2x Your Growth with Gorgias.io
Source Node: 865974
Time Stamp: May 16, 2021
Got 100 Customers? Believe It Or Not, It’s Time for Your First User Conference
Source Node: 1471250
Time Stamp: Nov 10, 2021
My App Stack: Nivas Ravichandran, Head of Marketing at Spendflo | SaaStr
Source Node: 2355054
Time Stamp: Oct 29, 2023
In 2024, Maybe It’s Best Everyone Starts as an Individual Contributor. | SaaStr
Source Node: 2434227
Time Stamp: Jan 9, 2024
5 Interesting Learnings From ZoomInfo at ~$1.3 Billion in ARR | SaaStr
Source Node: 2374020
Time Stamp: Nov 8, 2023
Dear SaaStr: Why Did Loom Have a $1.53 Billion Valuation in 2021 and But Is Now Being Acquired by Atlassian for $975 Million? | SaaStr
Source Node: 2326959
Time Stamp: Oct 14, 2023
Dear SaaStr: Are Clawbacks in Sales Applied if the Customer Has Paid in Full?
Source Node: 1924976
Time Stamp: Jan 28, 2023