I started my journey as a tech-entrepreneur in the year 2020. I was a sophomore in school when I started my first software consultancy firm.
The world has changed now and so have I. I am not interested in building software for one client at a time. I build startups that serve thousands of customers. I no longer charge them a one-time fee and a small yearly maintenance contract (AMC) fee. I now charge them a small amount every month. This is what they call Software-as-a-service (SaaS).
In this post I am going to talk about my experience building over 30 SaaS startups. I have identified three common mistakes that I made that can be avoided early on. Without much ado, let’s discuss them.
Mistake 1: Wrong pricing
Your pricing is a big factor in your conversion. You price your product too high and people will go to a competitor because you are too expensive for them.
On the contrary, if you price your product too low they will get into the “you get what you pay” mode and will go to a competitor who charges more.
There is no set formula on what should you charge. However, look at your competitors and try to cost in the same ballpark. In most cases businesses are not looking for the cheapest solution. Sell them on your product and not your price.
You should experiment with your pricing. Try increasing your price and see how does it affect your conversions. You will find a sweet spot after a few months of tests. Keep in mind that if you charge a customer more and then reduce the price, you should change the price for the earlier customer as well or they will not be happy.
Mistake 2: Lack of customer support
When you are trying to find your first customer, you can probably manage it yourself. However, it will soon become your full time job if you are doing it yourself.
Your customer support people are the primary contact point for your customers. Make sure that you are hiring right people for this job. Hire one more than you need and make sure they empathize with your customers. Invest in proper tools for customer support, there are many such as Intercom , Drift, FreshDesk etc.
If your customers don’t know how to use your tool properly, it is your mistake and not theirs. You should talk to your team regularly to see what kind of common issues are there and keep fixing them.
Mistake 3: Lack of customers
No amount of customers is enough, but not having enough customers will literally kill your startup.
You need to figure out the avenues to source customers. SEO is usually a free method to get customers, but it is a long game rather than instant gratification. However, get that expertise and keep it in mind from day 1 as it pays off many times over.
Paid ads are a good way to validate that people will buy what you are offering them. It may not be a sustainable model in the early days if you are bootstrapped though.
Finally, keep looking out for channels that can help you get more leads. It could be collaboration with an influencer, posting on Facebook groups or building a following on LinkedIn. There are multiple tools to help you with these such as Buffer, Hootsuite (but I recommend the best Hootsuite alternative called RecurPost).
I hope this article will help you avoid the most common mistakes B2B startups make.
