SaaS_startups

According to CrunchBase, there are about 11,288 SaaS-based startups in the world. That’s the level of competition we are talking about. Companies are always on the lookout for ways to keep them ahead of their competitions.

One thing successful startups have found out is that while most of the factors might not be within their control, the internal factors such as cost and resources are definitely within their control. Proper financial planning and optimised execution are the building blocks to any long term business’s success.

Having experience of co-founding and running three companies, with one in London and the two in India, the last 25 years have given me key insights into how to make the most with the resources you get.

I have tried, tested, failed, tried again, and succeeded in implementing measures and goals to optimise resources. One thing that I have learned over the years is that you don’t win in business (especially startups) if you waste money.

What we are going to address here is not just about being frugal but also about being sustainable. You cannot build a business by being a cheapskate, right? What worked for us was finding the right talent (or rather a sustainable talent with low turnover) and developing deep knowledge about the problem we are solving. The key here is to develop a low yet evolving footprint.

Also Read: A Beginner’s Guide: Should I buy a SaaS for my startup?

Frugality in work and office space

The section that I would like to discuss is how we optimised the costs in our daily-tools and operations. I believe this is where we saved a major chunk of our resources. We were very open and candid with our employees about our ethic of frugality in everything that we do in the company. We tried to be sustainable in almost everything that was under control, from creating a coworking space, work from home facility to using the right tools to minimising the travel expenses. To dive you a little deeper and get into the details, I’ve broken down the list into these areas.

Frugality in the product-development phase

Although we were being cost-effective with a lot of our choices, we never compromised on the quality of tools for our software developers. They would always get the most advanced and tech-forward computers and equipment. Before you jump to the conclusion that this was a biased (and uneconomic) call, let me tell you how it wasn’t.

As a SaaS company, developing a competitive product was the heart of all our operations. And my top priority was to take long-term, sustainable and smart decisions in product development.

One of the fundamental decisions that we had to make was choosing the cloud server infrastructure. It was a close call between AWS and DigitalOcean and we went with the latter.

One reason was obviously the pricing. And since we had a few but skilled and experienced software developers and I myself was involved heavily, it allowed us to build the website from scratch and gave us the flexibility we wanted.

Another bold technical decision that we took was choosing Scala as the language for programming. Scala is a very sophisticated language and to be honest it is not an obvious language to choose. The reason why I insisted on using this language is that I had over 15 years of experience working in Scala.

Not only did I have trust in it, I knew that I would be able to oversee each and everything going on in the website. And in case of an emergency, I will be able to take things on my own hands and keep the website in check. As entrepreneurs, sometimes it is important to take the route that is comfortable for you or one which you have faith in rather than venturing into unknown territory.

Also Read: 5 things Saleswhale learned about building a global SaaS platform from Southeast Asia

So far these two have been some of the good (and frugal) decisions we have made.

This doesn’t mean we haven’t made any mistakes. We did. Big ones that too.

For any startup that wants to build a mobile application, one of the cheapest and obvious ways is to go for a hybrid platform. We did the same and went for Titanium, which is a hybrid platform. But we started facing a lot of performance issues and it just didn’t suit the product we were building. After one year of struggling we had to move to native development. The app was already live on Titanium and it was a massive struggle to shift the platform. We could do it only because we had a very small number of users at that point in time.

So my advice for upcoming SaaS entrepreneurs would be to spend adequate time in the product development phase. Remember each small and big decision that you make in this stage will stick with you in the long run. In my opinion, the best way to be frugal here is to aim for the long run and go for a sustainable approach. The more you switch platforms in the later stages of your development, the more expenses you will suffer. Having a sustainable approach ensures frugality in the long run.

Efficient use of office space

One of our top priorities was having a good coworking space. Since we were a small team, rigorous collaboration was a must. While deciding on the office space for the Guwahati team, we made sure that a major part of the office space can be utilised as a coworking arena. This is where people across departments would sit together and work.

In fact, for the first five years, I myself preferred sitting in the common area. This helped us in two ways, mainly. Since we were a one-of-its-kind SaaS software operating from India, this working style helped everyone in the team understand each other’s role and contribution towards the common goals. Secondly, it helped us save a lot of money as we didn’t have to spend too much on renting out extra spaces for each team and department.

Also Read: How to choose a coworking space for your startup

It is a no-brainer that managing the operating space effectively can generate additional profits. I’ve mentioned earlier about the common working area which helped us a lot in setting the tone of the workplace. Rearranging and making the most out of the available space smartly can save up quite some bucks. Since we were sacrificing personal luxuries at the top-level, people never complained if we didn’t have state-of-art furniture or matching desks at our office.

Remember at the beginning of the entrepreneurial journey, the focus should be solely on growing (and sustaining) the business. When that happens, having a nicer office will be the least of your worries.

As a perk to make up for the limited desk space, we had a loaded snack station to keep our people happy during work hours. (This is a proven hack and I would definitely recommend it).

We didn’t have such options in India back in the day but you can even rent furniture from places such as Furlenco on a temporary basis. Optimising on your resources for the long term and sustainable development is not easy and definitely be augmented with years of experience behind your back. What wise people do is learn from their mistakes, smart people learn from others’ mistakes.

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