How to Start a Successful SaaS Startup



Senior editor

Parul Saxena

Chief editor

Last updated: February 12, 2021

The global software as a service (SaaS) market, hasn’t unleashed its full potential yet. In fact, it’s continuing to grow steadily and is projected to reach 63.36 billion dollars by 2023. These numbers make the market the largest segment of the cloud services industry.

Getting a share of this spectacular and ever-expanding market is possible, especially if you start with the right idea.

Launching a successful SaaS startup begins with a good concept and a well-formulated plan.

Several other essentials include developing the right business model, testing the idea thoroughly, understanding the competition and what makes your SaaS business different, having a customer onboarding strategy, and continuously focusing on ensuring high-quality service.

Learning from the experience of others will always serve as a reliable source of inspiration.

While most startups do fail, some have managed to establish themselves in the respective field and grow their reputation quickly.

Today, we’ll take a look at some of these SaaS startups and the factors that contributed to their success.

List of Successful SaaS Startup

1. The Spectacular Growth of Shopify: Innovative Service Provision

Even if you don’t work in the realm of eCommerce website development, you’ve probably heard about Shopify.

The company was launched in 2004 because its founders didn’t really like the solutions available to online retailers at the time.

Today, Shopify is the third biggest eCommerce platform in the world, with a 20% market share. Statistics suggest that Shopify supports over 600,000 businesses, and the company’s total revenue for 2018 reached 1.07 billion dollars.

  • What Shopify did differently?

At the time, Shopify introduced an array of innovative services and solutions that its competitors didn’t feature. Shopify allowed small and medium-sized merchants to build their own website and customize the final outcome. It also provided for automated inventory management and easier payment processing.

The Shopify team also invested in key partnerships with top dealers and even eCommerce websites like Amazon to boost the popularity of the platform.

2. SalesForce Won Through a Focus on Progressive Development

SalesForce is another excellent example of a SaaS startup that evolved rapidly.

The cloud-based software company offers customer relationship management (CRM) solutions, marketing automation, and customer service tools.

Set up back in 1999, SalesForce grew quickly due to its diversified portfolio of readily available solutions for an array of business needs. Progressive development and constant modifications of the tools to address contemporary realities have also proven to be beneficial.

  • What SalesForce did differently?

The SalesForce empire is currently valued at 13 billion dollars. The startup grew so fast because the company developed relatively straightforward business solutions and put heavy emphasis on the benefits of the cloud. In fact, many reports suggest that SalesForce is the very first company to adopt and push the model aggressively.

3. Trello’s Utilization of Word of Mouth Promotion

A number of startups have become wildly successful due to the effective marketing strategies they adopted.

Trello is one outstanding example.

The free collaboration tool is used to organize work and do effective project management. What’s most interesting about the company is that it doesn’t do marketing on its own. Rather, it relies on customer advertising.

  • What Trello did differently?

Instead of having a dedicated marketing budget, the company decided to focus exclusively on improving the quality of the SaaS solution delivered to clients. As a result, Trello has received a high volume word-of-mouth promotion. There are countless reviews, blog posts, and social media recommendations because Trello works, and its customers are more than happy to share that information with the rest of the world.

4. Zendesk: The Power of SEO and Domain Names

Here’s a really cool example of how careful market evaluation can contribute to the growth of a SaaS startup brand.

Zendesk is a cloud-based customer service solution. It gained a ton of popularity through a carefully executed marketing strategy.

Through search monitoring, the startup employees found out that people were searching for “Zendesk alternative” on Google. They were trying to identify other similar service providers, and the Zendesk team saw an opportunity there.

The company invented a fake music band called Zendesk Alternative, bought the domain name, and even created a social media presence for the band. Thus, when looking for Zendesk alternatives on Google, people would come across this bizarre but carefully formulated marketing ploy.

  • What Zendesk did differently? 

Zendesk recognized the power of search engines and the right domain name. Tools like can be used for the purpose – they help for the pinpointing of effective branding opportunities. Going back to the Zendesk example, the fake domain converted 95% better than the main Zendesk website. It really won customers through creativity and the fun approach towards beating the competition.

5. Sophos: A Lucrative Niche, a Ton of Personalization

Security hardware and software solutions are becoming increasingly important as digital threats evolve in potency and scope.

Sophos was launched as a security SaaS startup that developed antivirus solutions. The security services are very diverse, which is one of the primary factors behind the success of Sophos.

  • What Sophos did differently?

For a start, Sophos began offering solutions in the security field. This happened at a time when few other similar developments were readily available. In addition, Sophos makes excellent use of the flexibility brought on by the cloud. Companies can choose the exact service that matches their needs without spending money on an overpriced solution that will remain largely unutilized.

There are several key lessons to learn from these examples.

Obviously, having a product that people would want to buy is the first one. The second, much more important lesson is that successful SaaS startups see opportunities where others see threats.

A well-planned marketing campaign, clever use of competitor strengths, and the identification of unmet customer needs can all have a profound effect on the success of a startup. Paired with a great product and high-quality customer service, such a daring, and tailored strategy would never go wrong.

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