Web developers - opportunity for you to make your fortune [Archive]

DuaneJackson

19th March 2009, 11:31

If you're a web developer, you've got a great opportunity to build a SaaS business.

The main costs in building a SaaS business is the development, if you can do that yourself then you're only cost is time. If the economy is giving you a kick up the backside then you might currently have a surplus of time.

Outline of the business model is here: http://blog.kashflow.com/2009/03/19/saas-business-model/

After reading that, I'd be keen to hear why you're *not* going down that route? Especially if you're still a sole-trader and/or your current business model isn't raking it in.

FireFleur

19th March 2009, 11:47

Well it is already happening, people are producing remote software.

But it is not cheap, and it is not quick to develop, you will be looking at probably a year to develop the solution to an acceptable level. No matter what you choose, then you need to build momentum as well.

But the idea is valid, and due to the economy a lot of developers now have software interests of their own. So, I do agree Duane, but perhaps caution more on selecting the thing of interest to you, it is going to be a slog :)

All software is a service really, be it a shop, EPOS, facilitating a business process, or entertaining, and again some things will work better than other things.

Investors are something that are generally of some importance, unless you have squirrelled away some wonga, but yes the opportunities are out there, as they always have been :)

dstockdill

19th March 2009, 12:17

I'd agree with Duane's encouragement here.

We launched a new software-as-service application this week. It's true it takes time to design, build, and launch - a year is about right. However other costs are relatively low. For example we use the cloud computing cluster in Amazon to run our servers which can cost even less than Duane's £1600/month. Amazon also makes it easy to scale up as your user base grows and they have tools that make backup and security a breeze. So if you're able to take a year out then you can do it.

I wouldn't bother trying to get funding right now unless you've got a killer new idea with an obvious and scalable revenue model. Doing some consulting on the side is a good way to fund the development and operation until the service starts to pay for itself.

Duncan Stockdill

DuaneJackson

19th March 2009, 12:32

I picked the £1,600 figures as it was an easy example of £16/m * 100. A bad example though.

It'd cost considerably less when you get started

stugster

20th March 2009, 07:15

Careful Duane... you might tempt me to develop that PHP version after all ;)

openmind

20th March 2009, 09:24

Or even a ColdFusion version :p

matt.chatterley

20th March 2009, 09:29

I'm waiting for someone to suggest a fault tracking system called.. wait for it.. you'll love this (except Duane who will probably throw something at me)... KrashFlow!! ;)

Or a waste management system - TrashFlow?

Sorry Duane - It's just that 'flow' can be tacked onto so many things! :D

Seriously though, with a good idea behind it (ala KF - there was a big gap in the market there), SaaS can be a real winner.

We've designed our eCommerce (http://www.mattchedit.com/Services/ECommerce/ComparePackages.aspx) system by drawing on elements of the SaaS model (since each installation is partitioned off, it's arguably not SaaS - but it picks up some of the good bits) - this lets us offer commercial eCommerce software, optionally with a bespoke design - at prices that don't squash small businesses before they get started!

Sure, charging £3k+ now and then is fab, but having lots of people paying a small fee is much fabber. Well, I think so!

dstockdill

20th March 2009, 17:50

I've added a blog post demonstrating another reason for going SaaS. Can't link here on my free account, but see our blog for user stats showing the market you have available. Less dependency on the UK market might be a good thing for a few years.

OldWelshGuy

20th March 2009, 20:54

I am developing a canabis racking system called hash flow!

In all seriousness though I have a great web marketing product that is hosted, I just don't have the time to damn well do it :(

UKSEOAgency

20th March 2009, 23:00

Thanks Duane

those 6 hours a night sleep time - has just been cut in half to develop my own SaaS product as ive found an idea :D

DuaneJackson

21st March 2009, 08:45

Thanks Duane

those 6 hours a night sleep time - has just been cut in half to develop my own SaaS product as ive found an idea :D

Good to hear, there's certainly plenty of ideas out there waiting to be exploited.

Interconnect IT

22nd March 2009, 01:37

Hmmmm - SaaS has the risk of becoming Shareware 2.0. I mean, it's good for some things, but not everything.

For instance, a lot of it has very poor protection of clients interests, can't be customised, and is completely outside of the open source movement - even where open source code is heavily used - for example at WordPress.com. Some SaaS is in effect platform software, like SalesForce.com, which allows you to do certain things you couldn't otherwise manage, but it's a limited system and the platform could change at any time and unless you have various layers going on I can see things getting very complex and scary in a few years time.

But, I cheerfully use various SaaS solutions. It tends to be no better or worse than most proprietary software and so long as API's are available it has excellent potential. But in general I prefer self-hosted solutions which support various APIs. Our bug tracking system is likely to cancel out our use of Basecamp soon, because it's a: a lot cheaper, b: proven to be very effective on complex projects, and c: we have full control of it.

stugster

23rd March 2009, 09:12

Interesting read here: http://news.cnet.com/8301-13641_3-10201715-44.html

edmondscommerce

23rd March 2009, 10:13

Interesting thread and definitely food for thought.

To me though as a developer I wonder how I would find the time to actually promote my excellent new SaaS system and bring in the customers..

Also as a lone developer I would be concerned about being vulnerable to some big corporate coming into the market place with a development team and marketing budget that I can't hope to match.

This isn't to say that I don't think SaaS is a viable and valid business model - but I don't see it as being particularly different to any other business model in that it ultimately boils down to having a good product with a unique selling point and an effective marketing system to promote it. There is no guaranteed success story. I am sure right now there are countless SaaS wannabes who are failing or going to fail.

If I was a developer who had been made redundant then I would definitely consider doing this. However to succeed I suspect you would have to team up with (as a minimum) an excellent general business manager and an online marketing expert.

Another totally viable business model for developers with time on their hands is to release an excellent open source software package and then set up a company to handle the support, installations, customisations etc required by businesses who adopt the open source software.

OOS has the advantage that it is totally free and there is already an infrastructure to promote these packages among a community. That means that marketing it is easier and you have the possibility of building up a large user base quickly.

However - you might then find yourself in a Twitter situation - massive user base but now how do I make some cash out of it???

Conclusion -

Nothing is as simple as just do it and you will make money

DuaneJackson

23rd March 2009, 10:18

Also as a lone developer I would be concerned about being vulnerable to some big corporate coming into the market place with a development team and marketing budget that I can't hope to match.

That can work in your favour (http://www.nytimes.com/external/readwriteweb/2009/02/11/11readwriteweb-kashflow_vs_sage_saas_battles_in_tornado.html).

However to succeed I suspect you would have to team up with (as a minimum) an excellent general business manager and an online marketing expert.

I didn't need to. what's the general business manager going to generally manage? I haven't had one of those. As for the marketing, you can learn it as you go alon. That's the approach I've taken and it's worked OK so far.

As for open source, the capitalist in me just doesn't get it.

JLF Marketing

23rd March 2009, 12:08

matt.chatterley

23rd March 2009, 12:10

I have no idea what this is as im no techie, however am i right in saying this is a piece of sofeware that opens up in a browser rather than being on a disc?

If this s the case i have a huge idea, where there is demand all over the UK for millions and there will always be this demand. How much would something like this cost to set up?

If this is not the case has anyone got any idea how to set this up?

Thanks

Yup. Thats the case - essentially (there are some finer details arguably involved)!

As to how much - less than something which would be distributed on CD or other media, most likely - but precisely how much would depend on what you want to do!

Also because of the nature of SaaS - essentially it is software distributed as a service, on a subscription basis (again, simplified view) - there are running costs; not a set of one-offs.

JLF Marketing

23rd March 2009, 12:13

DuaneJackson

23rd March 2009, 12:22

Anything from £1k to £20k+. It really depends on the complexity. I'm happy to have a chat on the phone or by email if it helps.

FireFleur

23rd March 2009, 12:23

edmonds commerce brings up a good point, and if you want to do things like this investment is important, not only for the money itself but for the involvement of others.

On paper it is quite cheap for a developer to produce software solo, you don't have the overhead of inter departmental communication, or office politics screwing up the works.

The trick is to find a good partner who can focus in on other elements of the business, or is silent for the main and pumps in cash when needed.

Promotion and support are the problems for developers outside of learning all the arcana that is :) It should be remembered that promotion is a simpler thing to do than code solution, but really promotion works on cash spend by being given access to other people's toys and audience. Support is problematic because it can just eat all your time up, better to sell separate support licences and/or install a charge by minute phone. Some try to create a community for self support and that is a powerful idea.

But all these ideas, are true of any software project, virtually all software is net aware nowadays, Software as a service, well what else is it or has ever been? The upgrade path is just on rolling, but of course that can be done without the main software running remote.

DBMark

23rd March 2009, 12:25

Is there anywhere i could find out more? I have an idea which i think would be great and would always be huge demand. Also, something which is always good, there is nothing out there to compete. How much would something like this cost to set up, i know its like how long is a piece of string. Say for example, i have a couple of discs with all the material i want on, but want it in this Saas format, whats involved?

Thanks for the quick reply btw.

I think you said it yourself by mentioning "How long is a piece of string". For example, when you state " a couple of discs with all the material I want on" - is this just reference data ie a kind of directory? This would be very easy to set up , all you'd need is a decent server/cache set-up with a high-performance database (the opensource db Mysql can be very quick if the clustering and indexing etc are set up correctly and queries optimized). Even if there were certain calculation required, this could be done without too much hassle.
Having said all that, if it was so easy to set up, you'd be sure to get competitor websites almost from the first day. Nothing is as easy as it first appears. But, yes, the initial tecnical installation would be relatively straightforward.

JLF Marketing

23rd March 2009, 12:35

This is a pure example, but lets say im a personal trainer and have put a programme together as a taster of what you will get if you use me. Ive put this onto a coupe of discs. What if i could put this into Saas and keep updating it, and rathr than it be a taster i could actually run it as a virtual trainer and keep updating it charging a subscription. This is an example as i do not want to give my idea away as i know nothing about saaS at the moment.

FireFleur

23rd March 2009, 12:45

You are describing charging for content.

Software as a service primarily revolves around the concept of a charge either on time or access.

So, it is not a million miles away from what we have at retail, so you buy an accounting package and the 'new' one comes out in a year. Except the release is more rolling, and well your accounting package could get updated in the year as well, it is very arbitrary.

One of the problems is lose of data control, but that can be addressed and of course it can also mean more data control but that comes down to the implementation itself.

You are free to apply any form of charge model, and revenue stream creation idea you can logically come up with. SaaS is a marketing term to alert you to the idea of something new with a twist. But it is just a twist, and SaaS remote was one of the first things computing offered, big mainframes and time charging. To this day most unix systems offer an accounting of the amount of CPU a user uses, that use to be a unit of charge.

Kev Jaques

23rd March 2009, 13:14

Hmm, Sex as a Service, would make a packet lol

Any takers? ;)

FireFleur

23rd March 2009, 13:18

What a brilliant and innovative idea, cor I wonder why no one has thought of that before? :) Oldest profession and all that :)

Tip of the hat for getting it into the acronym.

matt.chatterley

23rd March 2009, 13:19

Hmm, Sex as a Service, would make a packet lol

Any takers? ;)

That beats my latest joke. Damn you!

Was going to chip in with:

Sausage as a Service.

After all - most kebabs are merely rented! ;)

Kev Jaques

23rd March 2009, 13:22

Yea nothing new but thought it might raise a giggle or two and offer a bit more light hearted humour ;)
There could be newer models come along as the service time elapses ;) heheh no more trade ins heheh.
Could also have
Slaves as a Service
Spandex as a Service
The list goes on heheh :)

edmondscommerce

23rd March 2009, 17:06

That can work in your favour (http://www.nytimes.com/external/readwriteweb/2009/02/11/11readwriteweb-kashflow_vs_sage_saas_battles_in_tornado.html).

Evidently in your case, but one success story doesn't make it a guaranteed winner every time.

I didn't need to. what's the general business manager going to generally manage? I haven't had one of those. As for the marketing, you can learn it as you go alon. That's the approach I've taken and it's worked OK so far.

All credit to you. I know that I prefer leaving the accounts and business stuff to the people who are good at that. I have tried it and it wasn't my thing. I'm now making more money by being a specialist at what I do. I'm also less stressed out which is great.

As for open source, the capitalist in me just doesn't get it.
I know what you mean, however I also know that some people are making a mint out of open source.

All the above said, a longer term goal of mine is to set up a kind of SaaS system though it will be much much higher charges and much lower numbers of users. Similar business model though.

richardjeaton

25th March 2009, 19:58

I'm pretty new to these forums but am finding them really interesting - which I guess is why I am still reading them a few hours later ;)

It is even better to hear so much talk of SaaS as this is my speciality :D

I have worked in the SaaS industry before it was even known as SaaS and have seen it go from a "disruptive technology" to the mainstream and widely adopted model it is today. :)

Feel free to ask me any questions either on here or directly and can I point you in the direction of a "few" sites that I run on the subject if anyone wants to find out more :cool:

saasblog.com
saasforum.co.uk
saasgroup.co.uk
saasroi.co.uk

Apologies for the spaces in the links but as a newbie I can't post full url's to other sites yet :(

Hope this helps

Richard