The Business of SaaS

  > Businesses and investors love SaaS because the economics 
  > of SaaS are impossibly attractive relative to selling 
  > software licenses.

I would be careful and not over-generalize. The statement above is opposite of what many late stage investors think of SaaS companies. Their gross margins tend to be horrible. Some are basically in the business of being an intermediary mailbox for transferring money from their customers to AWS.

Sure, if you can charge, say $1 for processing one Kb of data, you'll love being in the business of selling SaaS subscriptions. But it's not always the case: for many SaaS companies selling more and more subscriptions means constantly re-writing (AKA "scaling") their codebase, maintaining a large and expensive ops team and dealing with ever-growing AWS bill. Some SaaS companies only have ~10% of their R&D allocated to evolving the product, the rest are struggling keeping it running and it's not cheap.

Compare that to selling a recurring subscription to a downloadable license file. Stripe is a great fit for SaaS, but TWLO will have to face a much tougher reality than MSFT had.

SaaS can be awesome, or can be hell, take it from a co-founder of Mailgun.com

Stock market seems to agree: the 1st wave of software explosion produced lots of highly valued tech giants: MSFT, ORCL, etc. The current crop of public SaaS companies pale in comparison, the new giants don't sell SaaS, they sell ads.

P.S. The billing model is very loosely related to how a software is delivered. Look at Adobe who're happily selling monthly billing plans for good old photoshop.

Isn't this more a problem of billing than of SaaS in general?

But yes, I recently read that games make more money in general than even movies, books and music and most of them don't have subscriptions but one time payments.

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In your case, I think you're best off learning each of those things from separate courses / learning material. Mobile app development and Kubernetes are simply not related at all.

This Flask course focuses on building a classic web app using server side templates. It happens to use Postgres and Redis while also performing background jobs with Celery.

To me that's the bare minimum for building a web app with Ruby or Python. Web app + DB + background worker + sprinkles of JS on the front-end. We use Docker Compose to get it all running because the alternative is rolling your own Python environment from scratch which is IMO more time consuming than using Docker.

That's also a good article you linked and I agree with pretty much everything they wrote.

I think it's more important to ship your app than try to incorporate every buzz word for the sake of doing it. I'll admit, sometimes learning new things is highly motivating but at the end of the day, the tech wins REALLY need to be there for it to make sense.

For example I choose not to use Kubernetes in production because 1 server deploys with Docker Compose is very easy to reason about and it works well, even for decently high traffic. I treat ops like I do code refactoring. It's important to get something working, and if you ever get to the point where it becomes a problem, then refactor.

The interesting thing there with ops is, if you have a SAAS app running with 800 customers and 50 of them are on concurrently, do you really need a self healing auto scaling Kubernetes cluster on multiple regions?

Probably not. Those 800 customers might be generating you $49 / month each or $39,200 per month in revenue and something like that could be running on a single $40-80 / month server with a Flask set up (or even Rails for that matter).

In my mind, I'd rather spend my time figuring out how to grow from 800 customers to 8,000 and even then you could probably vertically scale your server, but at this point you're rolling in so much cash that it's all irrelevant. You could just pay someone $100,000 to fix your scaling problems over the course of a few months (without outages) and continue growing your business.

Basically, front load your time in making your product really cool and successful, then invest the time (or money) into scaling when you need it.

I'd be very eager to read whatever you post. My contact details are in my bio if I can be cheeky enough to be remembered when you do publish!

Interestingly, I often feel like Adobe wants it to be higher-touch.

I've had the $10/mo Photoshop+Lightroom bundle forever. I almost never use them, and when I do it's definitely not for pro-level stuff, but I find it worth the price to have these tools available when I need them.

Adobe, on the other hand, really really wants me to get into Behance, watch this or that instructional video, take a survey, read their blog, etc.

But if I got that engaged with their ecosystem, I'd surely end up with support tickets and so on, but I doubt I'd give them any more money. I get that it's worth it to them on average, it just feels weird sometimes as I'm a dream customer at $10/mo.