- If you're building out a SaaS business
and you're trying to find the right SaaS idea.
The thing is you don't need to get too fancy,
if you look at some of the most successful SaaS businesses
that has existed ever, they only boil down
to three golden ideas.
There's only three golden ideas that actually exist
when it comes to building a successful SaaS business,
whether it's a traditional SaaS business
or a Micro SaaS business.
So in this video, on this episode,
I'm gonna walk you through the three golden ideas
and how to pick the right one
and how to actually go after the right market.
Intro.
(upbeat music)
What's up everybody. Welcome to Unstoppable.
On this channel I help SaaS founders,
like you navigate the path to the next stage of growth,
navigate the path to product market fit
and to help you build epic SaaS businesses.
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Welcome, it's really great to have you back.
Now, if you're building out a SaaS business
and you're trinary figure out the right idea,
it's really easy to get overwhelmed with the sheer number
of ideas that are out there.
But here's the thing, there's only three golden ideas
that actually exists in SaaS, only three.
So if you're excited to dig in to the actual idea,
I'll then tell you how to pick the right market to go after.
And they'll give you some resources
to actually dig more into this.
So if you excited to dig in, smash that Like button.
Okay, so first of all,
there are only three golden ideas of SaaS.
The first one is your system of record.
This is where you write down
everything that you did in your job.
When it comes to B2B, SaaS systems of records are kings.
If you're a system of record in a particular market,
you will have such deep moats.
You will have such unique advantages.
You can become an epic brand.
Wanna know what the biggest system of record
out there is right now in B2B SaaS, it's Salesforce.
And in fact, Salesforce is so huge, so big,
they actually just surpassed Oracle in popularity.
As of four days ago, Salesforce actually passed
the market capitalization of Oracle,
which is insane because Oracle was started in the 1970s
or 80s in our arcade times, and Salesforce were started
in this century, that's insane.
And if you actually look deeper into the history
of Oracle and Salesforce, at one point,
Salesforce was the underdog
and yet they were able to grow, why?
They were able to grow because they went in for the crown.
They went in from becoming the system of record.
Now, suppose you're going after a market
and we'll talk more about markets after this,
but the system of record is already taken,
then what do you do?
That's when you get to the second golden idea.
The second golden type of SaaS idea
is the system of engagement.
If the system of record is where you go
to actually write down what you did,
the system of engagement
is where you actually do all the things.
Tout App, for example, was a system of engagement
for salespeople.
There was no way in hell we were gonna become
the system of record for salespeople.
Salesforce had that locked down
and if Salesforce didn't have it Oracle didn't,
if Oracle didn't have it, Microsoft dynamics didn't,
and they didn't do it, HubSpot didn't
HubSpot didn't do it.
There's a long tail of CRM providers
that were trying to be the system of record
for niche markets.
We were like, "there's no way we can compete with that."
So let's go and be the system of engagement.
And for the system of engagement for salespeople
actually helped them send emails,
it helped them write down their tasks
and helped them follow up
and helped them make phone calls.
It helped them run their meetings.
All of that was a system of engagement
and it sat on top of the system of record.
Now it's very rare.
Most of the time a system of engagement will never be more
valuable than the system of record.
So there is a hierarchy to this.
So the second type second golden type
is system of engagement.
And then finally, there's the third golden type,
which is the you have a system of record.
Then you have the system engagement.
The third golden type of SaaS is your system of decision.
Let me explain on this one, 'cause this one
is not as popularly known.
System of decision is essentially
where you go to make your decisions.
This can be a BI tool, a Business Intelligence tool.
This can be a analytics tool. This can be a reporting tool.
This can be a bespoke tool that looks at a bunch of ideas
and gives you some predictions because of AI,
but that's essentially your system of decision.
So, basically you have a pecking order here.
The most important thing in any market,
in any space when it comes to SaaS is your system of record.
The second one is your system of engagement
where you actually do the work. You do the work there,
and then you actually go and write down
what you did in the system of record.
But the value of the system engagement providers
writes it down for you.
So you actually just do the work.
And then the third one is your system of decision,
your system of decision so you decide
what you're gonna do.
Gives you a bunch of data, gives you insights,
maybe gives you some predictions.
And based on that, you decide what you're going to do.
So you go do it and this in the system of engagement.
And then once you do it, you go write it down
in a system of record if the system of engagement
doesn't do it for you.
Are you guys getting this. When you think about it,
if you think about any successful SaaS business anywhere
they fall under one of these three categories.
So let's just say you're now saying,
"all right cool, I wanna do one of these.
This is gonna be one of my SaaS ideas.
How do I pick the right market? "
If you've been following me for a while,
you'll know that market tramps everything.
If you have a great market and a mediocre team
and okay product and an okay Go-To-Market,
you can still win.
When you can have a phenomenal team,
a beautifully built product,
an amazing and brilliant unstoppable sales funnel.
But if you're in a shitty market,
you will not win, you will not get anywhere.
So markets matter the most.
Market essentially tramps team product
and Go-To-Market all together.
So picking the right market is super important
when you're picking your SaaS idea.
And the way I like to do it
is I like to find specific markets.
My biggest question that I asked SaaS founders,
when they're just starting off, is who do you want to serve?
Who are the group of people that you want to serve.
You spent a lot of time with, they have domain knowledge in.
You can find those groups of people you wanna serve them.
The next step is go figure out what market they're in
and then ask, do they already have a system of record?
If they have a system of record and super legacy,
it's outdated, like it was with Oracle versus Salesforce,
then go disrupt it.
But if there's already a system of record
and they're brand new and they're in the Cloud
and they're great, then maybe you don't wanna disrupt them.
Then maybe your idea for that market
should be a system of engagement.
If there's already a sense of engagement,
then your idea maybe should be system of decision.
And if there's already a system of decision,
then maybe it's a crappy marketing
and you shouldn't get into it.
Now let me pause here for a second before I go into
how you can apply these ideas into your SaaS
or a Micro SaaS business.
I want you to comment below with yes,
if you start to get this.
If you start to see the pattern where
you don't really need to make this all complicated,
all you really need to do is figure out
are you doing a system of record, system engagement
or system decision.
Because those are the three golden SaaS ideas
for getting that got to smash that Like button
and if you haven't already comment below with a yes.
If you're not shy and you don't wanna complain about me
telling people to say yes, I want you to say yes.
It's fun. Just do it it's awesome say yes down below.
And then let's dig into principle number three.
Now, before we go into principle number three,
by the way, if you are starting a SaaS business,
if you are digging more into this,
if you're trying to figure out your strategy
around your market,
be sure to check out my 10 point SaaS checklist guide.
Once you hone in on your market and you hone
into the SaaS idea, one of the things you're gonna have
to figure out is what type of SaaS business
you wanna build.
Now there's two kind of SaaS business.
You can either go for a traditional SaaS business,
or you can go after a Micro SaaS business.
Micro SaaS business these are all the rage today
because they are very small.
They're self contained and it can be
incredible revenue generators without a lot of funding.
Most importantly, they can go after very specific
small niche markets.
Let me explain, there's this actually three kinds of stores.
Forget SaaS business for a second. Think about brands.
Think about stores, let's just say think about
your local retail store that you would go to.
There's this actually three tiers of stores.
The first kind of store that you're gonna find in a mall
is a global brand.
That's kind of like a Walmart, your Best Buy
or Apple or McDonald's, these are big global brands right?
The second you're gonna find it's a regional brand.
These are stores that are in specific regions.
They're not everywhere, anywhere in the world,
but in specific regions they operate.
They're not tiny they may be franchises.
They may have multiple locations but they're not as big
like a global brand.
And then the third kind, the third kind of store
you might find is a boutique store.
These are boutique brands. They're very specific.
They're owner operated.
They don't have multiple locations,
but they sell a certain thing
and they give an incredible service.
And they're very profitable businesses.
The same thing applies to SaaS.
When it comes to SaaS, you can have a global brand.
That's like Salesforce, you can have a regional brand.
That's like, Hoot Suit.
They're big but they're not everywhere like Salesforce.
Or you can have a very boutique brand,
a Micro SaaS, something like a Built With,
which apparently has one employee
and like millions of dollars in AR.
That's a perfect example of a Micro SaaS.
There are a lot of cases where you may come across
a certain market. That's amazing it's a great market,
but it's not a venture scale market.
That market happens to need a system of record
or needs a system of engagement.
But at the same time, it's not so huge
that a venture capital's gonna be salivating over it.
This is a perfect place for you to actually build
a Micro SaaS business.
When you build a Micro SaaS business.
They tend to be going after smaller niche markets.
They then tend to be very well-defined.
They tend to have a self service offering
and they tend to actually be profitable,
wildly profitable for the founders themselves.
So to recap, there's only three types of SaaS businesses.
System of record, system of engagement
and system of decision.
What matters the most when you're picking your SaaS idea
is not a crazy idea.
You just gotta pick one of these three,
but really figuring out what's the right market.
Because market tramps everything, you pick the right market,
you figure out which one they need and go build that.
And when you're doing that based on the market
that you're picking, based on the market you wanna serve,
based on the market and the size of that market,
you can then pick whether you're trying to build
a traditional SaaS business or a Micro SaaS business.
There's no right or wrong answer to this.
It's just what's the right opportunity.
The market determines the opportunity.
There's no such thing as a great idea in a vacuum.
The market decides if it's a great idea or not
today, tomorrow and the day after.
So, there's a couple of videos
that you might wanna check out.
If you'd wanna dig more into this.
The first video that might be very valuable for you
is to check out my video on "figuring out
Total Addressable Market."
You check that out over here. Also link to it below.
I go into much more detail on how to really
measure the market and size the market step by step.
Also I have a brand new video coming out
on "how to do TAM the right way versus the wrong way."
This video down below will give you the primer.
But the next video that I'm launching,
I think it's coming up on Wednesday
is gonna give you a much more practical guide
to measuring TAM.
So, be sure to hit the Subscribe button and that bell icon.
So you get notified when I dropped that video.
The other resource I have
is if you're about to start a SaaS business,
check out this video on "how to start a SaaS business."
If I were to start one today,
I've had nearly 15 years of experience
in multiple SaaS startups under my belt
in building SaaS companies.
So I did a video and what I would do
if I were starting one literally today.
So you can check that out here.
I'll link to it below as well.
The last resource I have for you
is my 10 point SaaS business checklist.
It walks you through a set of questions
that you should answer to really validate your SaaS idea.
Great SaaS businesses are built on the right market
with the right product and the right Go-To-Market motion,
all three at once, early on.
So, I have this checklist that you can download.
You can follow the link below
or go to tkkader.com/sass-checklist.
I'll link to it below as well.
Lastly, if you got value from this video,
please smash that Like button
means the world to me and my team and the YouTube algorithm.
If you have a founder friend,
if you have an engineering friend
that's always been thinking about quitting their job
and starting a business, please share this video with them,
share this channel with them.
We wanna get our word out there to as many SaaS founders
as possible
. We're building a community an unstoppable community,
of SaaS founders,
and lastly remember, everyone needs a strategy
for their life and their business.
But when you are with us, yours is gonna be unstoppable.
I'm TK. And I'll see you in the next episode.
(soft music)
When you think about the most successful SaaS businesses
that exist anywhere, let me shut this off.
This keeps going off. Why does this keep going off?
Sorry.
Okay great, lesson number three,
is now that you have your three different
types of golden SaaS ideas.
(phone ringing) Oh my...
(long beeping)