Top 6 Mistakes to Avoid in Your SaaS Startup


The SaaS (software as a service) industry has created many successful businesses. Each new startup has drawn the attention of those with an entrepreneurial mind looking for their big break into the field.

While it may seem simple at first to become an SaaS owner, there are many common pitfalls the uninitiated fall into. These mistakes could not only impede your business growth but potentially cause your startup to fail before it begins.

Keep reading for the top mistakes SaaS companies make when getting off the ground to know what to avoid as you begin your journey.

1. Not Having a Strategy

In the SaaS industry, “strategy” can take on many meanings. Generally speaking, the most important is identifying the cost to run, market, and acquire customers for your business while not letting it flounder and sink in the early stages.

Here, most people repeat a common mistake: they treat their SaaS company like any other small business startup.

While this might seem unimportant, software companies follow a different growth trajectory when compared to other businesses that are selling a physical product. These companies are not only in a position where they have to attract a client to make a purchase, they need to retain that clients on a month to month basis. Furthermore, in the land of tiered and monthly subscriptions, the cost to acquire new clients is often far more demanding in the early stages of the business model when compared to other industries.

Thus, when these elements are not taken into consideration, first-time SaaS founders can find themselves in a difficult position where their growth is inhibited by their financial capacity or they have run their business under water.

2. Finding Your Market After Developing a Product

One of the biggest mistakes new SaaS entrepreneurs can make is to start developing a product without first identifying their audience.

Why is early identification important in SaaS? Convenience.

You are selling a product that is going to help your clients do something. How can you best develop that software if you don’t know their workflow needs? How will you ensure their customer success without knowledge of their specific industry pain points? Will they benefit from a cloud-based service?

Without knowing your audience ahead of time, you won’t be able to answer these questions. The result is that you might have amazing software, but it won’t quite be what any single group is looking for-- losing you customers to more well thought competitors.

3. Poor Timing

In many ways, this mistake is often heavily influenced by the above two points. Without a good business plan, growth strategy, or understanding about your market, it’s going to be very difficult to accurately assess when it's the right time to launch your product.

Launch is an important time for startups because without a robust launch, your business will not have enough revenue to continue past the initial start-up phase.

4. Overlooking the Power of Content Marketing

In the early days of content marketing, business owners used the material for the sole purpose of selling their product and boosting visibility. The role of content marketing has now changed.

On the internet, corporations are personified. Customers expect and desire to interact with the businesses they support and look for that same level of presence on the internet. Use this to your advantage by maintaining social media pages where consumers can interact with you, where you interact back with them, and a blog which doesn’t pedal a product, but shows you are a knowledgeable industry leader.

5. Being Unoriginal 

While Zebras are exotic creatures, in a pack, their individual uniqueness is lost in the similar patterns of their herd. In many ways, the way you present your startup to the world is the same way.

When you are starting up, no one knows your company, why you’re great, or why they should use your service. The issue is, many companies use the same techniques to seem exciting and innovative when, in reality, you blend into the (albeit brightly colored) background.

6. Poor Customer Service

This one is huge for SaaS businesses and SaaS products.

Think about it-- if you are trying to sell a product that runs off a software, there will undoubtedly be many technical moving parts that your average consumer won’t understand. This means that when there is a problem, whether its a software bug or a user error, your clients will likely have few tools to fix the issue themselves.

In situations like these, your customer base is fully reliant on you to have the best customer support possible. This is especially true if you are marketing your software to businesses who could lose precious time troubleshooting an issue that impacts the workflow of their entire staff.

SaaS Funding Experts

Many times what gets in the way of a SaaS company reaching their full growth potential is not having the funds to function at that initial negative profit while leads and sales are being discovered.

At RevTek, we take qualifying companies and help them reach their expansion goals by giving them the financial support where it's most needed. With a full staff of experienced entrepreneurs, we can help businesses assess their strengths, weaknesses, and help them refine and achieve their goals.


Contact us to begin the conversation about how to take your business to the next level.

Funding Solutions from RevTek Capital

If you are looking to raise capital for your startup, choose RevTek.

Our experienced team can provide you with the money you need to expand your tech startup.

Contact us today to learn more about how we can help your business grow.

If you are looking to obtain growth capital or move into a new market, contact us today.

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