B2B SaaS: everyone can be a winner.

First of all, for those of you out of the loop: what is SaaS? Often terms like that can be lost on those outsides of the fold. SaaS means software as a service. This is where software that are used on a recurring basis. A good example would be Dropbox. This is a service that allows users to store and share files. Microsoft 365, also a widely recognised SaaS model. Then there are others like Spotify. Although you may use many software service platforms many of the B2C (business to consumer) models have a freemium service to entice user migration. There are popular B2B (business to business) models like Salesforce, Trello and Zen Desk. eDot specialises in B2B SaaS startups.

The perfect, paid for, professional SaaS model is generally generating a recurring revenue by becoming a service within a business environment that aids a certain element of that business e.g. one of our portfolio companies Bionic optimises social media advertisements through analytical data. These platforms general rule of thumb is “everyone is a winner”. A well-designed SaaS platform will show the results, actionable analytics, or the monetary saving by using the service. The ideal SaaS model saves the company more substantially more money or time then is spent on that app.

If the SaaS can demonstrate that in fact it can both generate a profit while simultaneously saving money and time, then it becomes a valuable asset e.g. the value of the service must feasibly outweigh the cost to the company. If this SaaS model happens to live in the B2B space the sales and user migration of said app can easily be found and connected to. The opportunity that B2B SaaS offers over B2C is that the customer feedback loop is easier to implement faster to react to changes in needs or rethink product market fit. Or at least, in theory, this is how a proactive B2B SaaS business should operate, as they do have the opportunity to avail of this data.

Acquisition of B2B SaaS platform clients/ businesses can be easily achieved if the product does what it says it can do, tick the “everyone's a winner box” and have an easy to understand pricing structure. A key feature of B2B is within the selling, you actually can meet the consumer face-to-face. Something that B2C companies simply do not have the luxury of doing.

It may seem benign to mention a clear pricing model yet, when pricing complex analytical platforms designing something that is easily understandable gives transparency from the outset and easily lets the company factor in future cost and see the saving (time or money) that they may make upon purchase of the service. This also aids with price comparison. Often in SaaS B2B, at startup level at least, undercutting or offering a superior service to competitors is an absolute must, and often is the case, but somewhere along the line this gets lost in communication and the company can get preoccupied with the service itself and not truly immersing itself in the market.

Selling, retaining and maximising those MRR’s (monthly recurring revenues) is a business model with in itself. B2B SaaS is guilty, more so then other SaaS of “acquisition obsession”. Getting the next customer, without taking time to retain customers, is an early death knell for any B2B SaaS company. The B2B SaaS model is perfectly designed to form consistent professional feedback to the SaaS designers quickly react to UX issues and improve the model. The B2B SaaS companies utilizing this opportunity are surprisingly low. The feedback model can be transformative to the B2B SaaS and aid towards meaningful user driven changes within the platform. The business can then move from a product driven mind frame (which is a completely different business model again) to a pure service driven business model. The inclusion of these feedback loops the most vital thing to the business as this is how it will evolve and change.