A few weeks ago I was talking to an entrepreneur about his Software-as-a-Service (SaaS) startup. After three pivots they arrived at an idea that’s taken hold and are starting to scale. While they don’t have Saastr’s Initial Traction (ARR of $1M of more, ARR growing more than 100% a year, and more than 50% of new revenue from zero-cost marketing) yet, it looks like they’ll achieve that this year.
One of the great things about SaaS is that even with near initial traction, there’s a sense of inevitability that the business will be successful. Here are a few reasons why:
- Signing the first 100 customers provides enough use cases to feel confident that the next 1,000 customers will be signed up
- Engineering becomes more cohesive and stable with continued customer adoption and product development
- Starting the marketing engine is incredibly difficult (e.g. SEO, content marketing, etc.), but once it’s working, it keeps on giving
- Recruiting team members gets easier as the story and results are more developed
SaaS companies with near initial traction have an inevitability of success. While it isn’t guaranteed, with continued growth and high renewal rates, the chance is very high.
What else? What are some more thoughts on success being inevitable once a certain size and level of momentum is achieved?