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Ask HN: I need advice on my first B2B SaaS startup

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Re: Ask HN: I need advice on my first B2B SaaS startup

#21

Post by fab1an »

It is difficult to provide useful feedback without much more context, but - very generally:

- since you are just starting out, it is likely that your pricing is too low. Again, hard to say without understanding more about your product and market.

- at your stage it's probably best to try and close a few customers. Having >0 real, paying customers will help with fundraising (and maybe eliminate the need/desire to do any fundraising, who knows?)

- make a few extremely specific customers very very happy (instead of already aiming for "a lot of different industries and company sizes" as you put it.)

- pricing: once you have an idea on what type of customer to for first, figure out what your likely customer acquisition cost will be, and extrapolate your pricing from there. If it costs you 5k $ to get a customer, you probably want to get at least 3x from them over their lifetime.

Re: Ask HN: I need advice on my first B2B SaaS startup

#22

Post by fernandopj »

ericmarcos wrote: post #12

I'd recommend you to do some consulting. I know it's counter-intuitive and something you don't want to do forever, but at the beginning of a B2B company it's extremely useful for 3 reasons: 1) It provides quick cash so it removes the stress of having to look for money too soon. 2) Direct customer feedback while working with them on day to day problems. At this point you really want to understand your customers pains…

Second it.

If right now you're bootstraped, no revenue from SaaS yet, you and your cofounder are on your own and consulting, if related to your product, can give you 2) and 3) but more importantly 1), at a far bigger payout than you'll get from an early MRR.

This advice is opposed to common YC advise "don't lose focus, consulting IS losing focus" and I agree, but right now you're not funded, not accelerated, not incubated or anything and you're trying to finish your product. Stay afloat and don't burn your savings to the ground.

One more advice: finish your MVP soon, and at some point, early than you imagine, tell your first customers that's the version you're putting in production right now and it'll be like that for a while, because waiting for that customer(s) that "will definitely buy once we do X and Y" will KILL your roadmap and KILL your startup. You'll be doing features after features, won't focus on your core features and propositons, and won't discover what is your killer feature that you must polish. That's what will keep your first customers with you.

Re: Ask HN: I need advice on my first B2B SaaS startup

#23

Post by raleigh_user »

id suggest proceeding with caution. these pilot agreements.....did cash exchange hands? if no cash exchanged hands I'd treat these are essentially worthless.

I dont mean to burst your bubble but: if you're solving a problem that is serious enough businesses will give you money today. Usually (in my experience) these "once you add these features" are things that wont actually move the needle enough and you'll find yourself in continuous development of things that won't actually produce revenue.

If no money has exchanged hands, I'd suggest telling your sales cofounder to go get a pilot with actual money being handed over.

Re: Ask HN: I need advice on my first B2B SaaS startup

#24

Post by raleigh_user »

jbob2000 wrote: post #8

Stop coding and start selling. If you have something that is up and running, you need to get it in the hands of paying customers. Until you have actual paying customers using your system, you will be guessing about what features to build. Push the people you have signed agreements with to start using the system. Maybe they don't need the features they asked for. Push them to pay you. Do not pursue an investor until y…

yes. I love this. until you have 10 customers your business is bull (jason cohen said this, not me and I love it). go get some sales. else you and your partner are wasting your time. best to figure out no one wants what you've built in the next 30 days then 8 months from now when you're sunk costs are even larger.

Re: Ask HN: I need advice on my first B2B SaaS startup

#25

Post by oliverx0 »

fab1an wrote: post #21

It is difficult to provide useful feedback without much more context, but - very generally: - since you are just starting out, it is likely that your pricing is too low. Again, hard to say without understanding more about your product and market. - at your stage it's probably best to try and close a few customers. Having >0 real, paying customers will help with fundraising (and maybe eliminate the need/desire to do a…

Thank you, this is very helpful and insightful.

Re: Ask HN: I need advice on my first B2B SaaS startup

#26

Post by barry-cotter »

> Our pricing model is $10/user/month.

patio11: charge more

Seriously, unless you’re going to be selling exclusively into businesses with over 100 employees using b your service you need to charge more. The meetings to consider whether to use your product are going to cost the buyers more in employee time expressed in dollars than your product will.

Re: Ask HN: I need advice on my first B2B SaaS startup

#27

Post by oliverx0 »

raleigh_user wrote: post #23

id suggest proceeding with caution. these pilot agreements.....did cash exchange hands? if no cash exchanged hands I'd treat these are essentially worthless. I dont mean to burst your bubble but: if you're solving a problem that is serious enough businesses will give you money today. Usually (in my experience) these "once you add these features" are things that wont actually move the needle enough and you'll find you…

I appreciate the blunt feedback. Will definitely follow this. No cash has been exchanged yet in the pilot agreements.

Re: Ask HN: I need advice on my first B2B SaaS startup

#28

Post by oliverx0 »

fernandopj wrote: post #22
ericmarcos wrote: post #12

I'd recommend you to do some consulting. I know it's counter-intuitive and something you don't want to do forever, but at the beginning of a B2B company it's extremely useful for 3 reasons: 1) It provides quick cash so it removes the stress of having to look for money too soon. 2) Direct customer feedback while working with them on day to day problems. At this point you really want to understand your customers pains…

Second it. If right now you're bootstraped, no revenue from SaaS yet, you and your cofounder are on your own and consulting, if related to your product, can give you 2) and 3) but more importantly 1), at a far bigger payout than you'll get from an early MRR. This advice is opposed to common YC advise "don't lose focus, consulting IS losing focus" and I agree, but right now you're not funded, not accelerated, not incu…

Thank you!! This is part of the reason I was hesitant to do consulting. (Losing focus)

Re: Ask HN: I need advice on my first B2B SaaS startup

#29

Post by LeonM »

You need someone with sales experience.

Without knowing what business you are in, $10/month/seat sounds _way_ to cheap. You are working with businesses here, not consumers.

At this price point you would have to sell about a 1000 seats just to pay for yourself and your co-founder. If you want to bootstrap and hire 4-6 people, you would need to sell a whole lot more.

If you can really 'automate pretty much any business process' as you claim, than your product is worth much, much more than you are currently charging.

See if you can sell it at $1000/month/seat. Yes, sales will be twice as hard, but you'll need 2 orders of magnitude less customers to stay afloat. If you can't sell for that price, rethink your product or ditch the bootstrap idea.

Re: Ask HN: I need advice on my first B2B SaaS startup

#30

Post by martinald »

oliverx0 wrote: post #7
sharemywin wrote: post #5

accelerators https://thembaisdead.com/list-of-startup-accelerators-and-in... pre-seed and/or angel investors freelance to stay a float. funding portals: https://www.crowdfundinsider.com/2018/03/131246-finra-approv... https://www.crowdfundinsider.com/2018/06/134408-there-are-no...

Thank you, we also thought of accelerators as a plausible option. Part of the reason I asked the question though, is that I am curious how others are able to get from just an idea to VC funding. It sounds simple: build a great product, and get enough traction. But actually doing it, even if we believe in the product, seems to take a lot of time. Are we missing anything that other founders do? Or are the suggestions y…

Many of these people have a past track record which helps hugely, and/or connections with investors. For example, people which have worked in finance often have many coworkers and other contacts who are high net worth which will be willing to write a cheque on the basis of their personal relationship. I wouldn't underestimate this factor when looking at other investment deals.
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