Starting a SaaS business is not easy. It requires knowledge, experience, and consistent improvement of the product. While it may look like it’s easy to develop and scale, there are still a lot of steps to success that founders need to know.
In this episode of SaaS-Story in the Making, SaaS Coach Matt Wolach, along with CEO and Co-Founder of GreenPal, Bryan Clayton, talk about some important steps to scaling. With 15 years of experience, Clayton shares his story and expertise that can help founders build their companies by creating a strong foundation and utilizing their resources.
Podcast: SaaS-Story in the Making
Episode: Episode No. 209, “How to Scale Your New Business Quickly”
Host: Matt Wolach, a B2B SaaS sales coach, Entrepreneur, and Investor
Guest: Bryan Clayton, CEO and Co-Founder at GreenPal
TOP TIPS FROM THIS EPISODE
Venture Into an Industry You Know Well
Knowing the industry you’re in is essential in any business. Whether it comes from formal education, a past career, or experiences you’ve gathered, knowing the ins and outs of the industry gives you an advantage in cultivating a unique product or service that the market will love. And establishing something unique becomes your competitive advantage.
Knowledge and authenticity are two of the most powerful things you should have in starting your SaaS business. A fundamental understanding of an industry helps you identify which aspect is more advantageous for you. And it would jumpstart your process and get you the traction you needed. Clayton’s experience proves its efficiency. Spending 15 years in the industry enabled him to develop a product more efficiently as he acquired lessons from past mistakes. The knowledge and authenticity helped the company start at third base and get the traction they wanted.
Developing a product in an industry you know well gives you a competitive advantage. But if you decide to take a risk and shift to a different one, be sure to communicate with your target market. This allows you to better understand your potential customers in knowing what they want that you can precisely deliver. It gives you the advantage of working around them to develop your product, marketing, and the entire sales process and ensure that you provide the perfect product for them.
Do Things That Don’t Scale
Starting out with your product is the most challenging phase of your growth. Clayton calls it the “zero to one” stage, where you are building something entirely new and have nothing. It is a challenging time for SaaS founders. Naturally, your goal in developing this product is to scale. But it is also one of the most common mistakes startups make– trying to make everything scalable right away.
Clayton emphasized the need to do things that don’t scale because you’re at level one. Instead, focus on building your product how your customers, clients, and even providers would want it to look. Establish a great customer experience first and work your way up. You should be able to know your market well, and by the time you have acquired clients, ask for feedback and continuously improve your product. You can also give value by providing your users mentoring services. Not only can it establish your credibility, but also encourage them to use your product even more.
Developing a great product starts with a purpose. There is no absolute way to scale, founders will eventually learn it along the way. And the process demands doing things that don’t scale so you can scale eventually.
Build Your Company Culture & Practice Stewardship Delegation
Building your team is either your best decision or your worst nightmare. Company productivity lies in the efficiency and morale of your team. And when you’re a growing business, you might not afford to take huge risks.
Clayton shared two things that a founder should be in charge of and keep an eye on from time to time: company culture and strategy. The latter is about continuously improving your product and being aware of the competitive marketplace. On the other hand, the former concerns the internal structure and “vibe” of your company, and Clayton gave a few points.
First, starting from the hiring process, he preferred to hire people that “have a chip on their shoulder.” Having the desire to prove themselves and see the company role as something to fulfill almost guarantees persistence. Added to this, it is also important to gradually know the person you’re working with by consistently evaluating them for certain periods. But you should not rely on characteristics alone. In building the company culture, be sure that they have the vibe you are looking for while strictly taking into account the foundation of skills your company needs.
Startups tend to hire other agencies to do other aspects of their business. While it is cost-efficient and allows them to focus on product development, it can also be a waste of resources. In Clayton’s experience, it only made them realize that they have to learn the basics before hiring people to do it so they can practice Stewardship Delegation.
Founders should know how every task should be done in their company. And the only way is to do everything in the beginning. This allows you to set the standard you would want your processes to be at. And by the time you’re delegating it to a team, you have an established and personalized approach done the way you want it to. Because “it’s tough to delegate from the stewardship standpoint unless you’ve done it before.”
Aim for Escape Velocity
As a SaaS company, one of the most critical stages of business that you need to achieve is to make your product work for itself. And eventually create momentum for its growth. Clayton gave startup founders essential points to make it happen.
First, start with driving towards the product-market fit. Build your product around your customers, secure their trust, and make sure they want to use it more. Figuring out how to achieve the product-market fit prepares you to identify how you will create a flywheel. Clayton describes it as “where the product can help grow itself through just the natural use.” It is a cycle that affects your clients, providers, and prospects. As your business works, it pulls in more customers and providers into its cycle and creates better prices while reducing costs. Eventually, it will lead your business to escape velocity. This is where you will grow and accelerate your business far from your competitors. But you don’t have to increase your capital right away. You can bootstrap it and focus on improving your business model.
SaaS is like Poker
One of the most common mistakes in venturing into SaaS is thinking it is easier than a traditional business. However, software businesses are often always unique. They are built from scratch, an entirely new tool so that you will start from level zero. It can be so challenging that “you have to go from failure to failure without loss of enthusiasm.”
Building your ideal product should be taken one step at a time. And it is not always recommended to look way ahead of the stage you are in. Because SaaS is like poker, no guaranteed action can get you through every step. Instead, you will have to “make bets based on risk calculation.” This means you will rely on your knowledge and experiences to move forward. Significantly, paying attention to what is happening at the moment will help you decide whether to take a risk or not. SaaS founders are always at risk, taking bets and trying to foresee the outcome of their actions.
[06:31] “When you’re starting a software business, 99% of the time you’re inventing something brand new, from scratch, that doesn’t yet exist… that is an order of magnitude harder than any traditional business setting that you can ever imagine.”
[12:17] “I think in the early days, it can be helpful to do things that don’t scale and really hand crank on it. Until you figure out ways to automate and get the flywheel going.”
[13:55] “Don’t even worry about scaling it. Just get a seed amount of users and then figure out how to get the overlap between them and solve the most pressing problems at that stage of the game, then worry about that later.”
[10:07] “Start having lots of conversations with potential customers or ideal fit type customers, those types of people, and really get a deep understanding of who they are, what they’re looking for, what they’re striving for, what their goals are. And that’s where you can start to get a better understanding. So you can develop the product and develop the marketing– everything towards them.”
[14:11] “Too many times people are thinking too, too big and too long term.”
[20:38] “They succeed more often when I hire for culture, more than skills, as long as they have the foundation of skills.”
To learn more about Bryan Clayton and GreenPal, visit: https://www.yourgreenpal.com/
You can also find Bryan Clayton on LinkedIn at: https://www.linkedin.com/in/bryan-clayton-a96b33214/
For more about how host Matt Wolach helps software companies achieve maximum growth, visit https://mattwolach.com/.