Generally speaking, I think scaling product in SaaS is about 10x easier than consumer internet. Not easy mind you, but 10x easier. Why? Even Salesforce.com only has a tiny fraction of the concurrent sessions of Twitter, let alone Facebook. Your SaaS apps? It will likely barely tax a couple of instances at AWS. I think at EchoSign, we got at least a million users out of each server cluster. That’s a lot of scale from a handful of servers.
But on the people side I think SaaS is much harder to scale than consumer internet. Why? You need so many more different types of people, so much earlier.
To get to just $1m in ARR, you’ll need to attract:
- a seasoned marketer or two – can you do drip marketing? import leads to Salesforce or NetSuite? do lead scoring? marcom?
- the genesis of a sales team – a risky VPS or reps you’ll need to hire and manage directly. Do you even really know how to sell?
- the genesis of support and client success – who is going to manage those customers you worked so hard to close?
- business development/partner management
- in addition to your product and engineering teams. And a lot of those folks will think working in SaaS is more boring than consumer internet.
- and – most of those people won’t infinitely scale themselves. And you’ll have to constantly identify better and better people for these rolls, and attract them to your company.
It’s not enough to just play foosball and push out code.
Hiring is always hard. But my point, is if you aren’t willing to spend 50% of your time (x) recruiting leaders to a variety of functional areas — most/many of which you may have little experience in and (y) getting on planes and midnight calls and dragging the team to meet with customers and partners … and you aren’t committed to totally rocking doing this …
You probably won’t be able to pull it off. Your SaaS company will fail.
So ask yourself if You Scale. Early. If you don’t, bring someone in who does. Founders make the best CEOs, but if you can’t scale, you can’t do the job. And in SaaS, you’ll fail very fast.
(Cross-posted @ saastr)