Some surprises for me - 1. Why is VC funding so down the rank compared to self funding, friends and family, angels and even debt? Is it probably because VC funding expects a >100x exit and most SaaS probably can't deliver that? Or are SaaS founders turning away from VC for ideological reasons (like want to enjoy the process instead of rushing to justify a valuation?) 2. 50%+ people pursued ideas which were not their…
> 50%+ people pursued ideas which were not their own itch to scratch.
I can think of few reasons -
1. They are jumping into unknown places because they already know about companies and software in the topics they are familiar with and think they can't compete on technical bases alone. The catch is they are woefully unaware of solutions in those unknown places. It's easy to get something rolling anyways.
2. They fight in terms of pricing model or other metrics than on product as a whole on easy to push services. As a solo founder and owner, you can afford to price it lower than a team of many working full time or adjust it to 2% unhappy users. You don't need millions in revenue.
> 30%+ didn't validate before building. 20%+ just asked their audience. Effectively, 50%+ just jumped into it without doing any significant and rigorous testing. Probably because the cost of entry and failure is too low?
This is not specific to SaaS , the effects are greater partially explained by your mentioned reason a lot. But software is more magic to people in terms of earning money than other hardened ventures so no surprise it's hard to validate and find market for. Interestingly, lot of techies ignore simple ideas or immediate problems because they think they could have written a small script to solve it instead of being dependent on an external company if they were an employee yet that didn't happen, so why not?. More people need sales training and peeking outside their echo chamber (only companies who need software are tech companies or devs and normal internet users.)
> 80% don't offer a forever free plan
Economic viability and people want to generally ditch products and switch around a lot.
> Most founders don't know their website visitor to trial conversion rates.
> Asking for a credit card before a free trial has almost no correlation with revenue growth.
Mentioned by others already. It's pretty hard to account for. If you post your thing in technical places only (many people who open SaaS are pretty biased in their social network), lot of people are eager to test the thing but they don't convert into long term paying customers. I have noticed many people being burnt this way.