How to Build a SaaS Product [8 Steps Process to Follow]

Key Takeaway:

  • As per the report of EnterpriseAppToday, 73% of organizations are either planning or switching all their systems to SaaS-based solutions.
  • There are 8 steps for building a SaaS product out of that the first and second steps are core which includes defining requirements accurately and shortlisting a software development company.

Are you planning to build a SaaS product for your business? Do you want to learn about the core steps of building SaaS applications?

You are reading the correct post.

Being a leading SaaS services provider in Canada, we have experience in developing SaaS applications for multiple industries like healthcare, logistics, fintech, and manufacturing.

Based on our experience and extensive research, we have curated a complete guide on how to build a SaaS product.

By following this blog post, you get insights into the process of building cloud-based SaaS applications, the market size of SaaS applications, and later on the cost of SaaS software development.

Let’s get started.

Before you learn about the core process of developing a cloud-based SaaS application, let’s know the market statistics of the SaaS industry which helps to plan your SaaS app development effectively.

Growth of SaaS Applications in the Market

Here are the statistics on the SaaS market that provides insights into the growth of the SaaS industry.

  • According to Statista, the software as a service (SaaS) market is estimated to reach $232 billion US by 2024. Also, the report suggests that is the continuous growth of SaaS solutions as organizations worldwide adopt SaaS for multiple business functions. Solutions such as customer relationship management (CRM), ERP, and eCommerce.
  • According to GlobeNewswire, the SaaS market size is estimated to grow at a CAGR of 18.5% from 2022 to 2028. Also, the market is anticipated to reach $462.95 billion by 2028. The key market players in the SaaS industry are Google Inc, IBM Corporation, Microsoft, SAP, Amazon, and Salesforce.
  • As per the research of Zippia, SaaS growth can generate annual recurring revenue between $5 million to $100 million.
  • 73% of organizations are either planning to switch to switching all their systems to SaaS platforms, as per the report by EnterpriseAppsToday.

The above statistics indicate a strong sign that investing in SaaS solutions offers a promising future. So, whether you are planning to build your own SaaS application or planning to switch all your systems to a SaaS platform, this is the right time. Let’s learn about the complete process of building your SaaS platform from scratch.

How to Build a SaaS Product from Scratch [8 Easy Steps to Follow]

The process of SaaS development looks similar to the usual type of software development. But, the SaaS development process has its challenges due to its cloud-based nature. Follow these 8 steps that help you to create a tailored SaaS product as per your requirements.

  1. Define the Requirements and Goals of Your SaaS Product

    Having a clear vision and understanding of the problem you want to solve with your SaaS product is of utmost importance. Most successful SaaS applications in the market target specific pain points in the market and resolve them. So, while defining your requirements or making a clear vision for your SaaS development, ask these questions to yourself.

    • What problem would you solve for users? Ask yourself, what is the core issue that users are facing? How the current SaaS software solutions are addressing it, and where are the gaps to fill?
    • Who is your audience for your SaaS product? For identifying the audience, initiate surveys, and polls, and conduct market research, and interviews to get valuable insights into what kind of products end users want.
    • Who are your core competitors? Find similar SaaS products to your concept. The target audience of your competitors. Get an idea of potential gaps in the market or demographics that are underserved.
    • What is your unique value proposition (USP)? As you understand the problems of your users, articulate how your solution is different and better than existing solutions.

    Answers to all these questions help you define your SaaS project requirements. Remember, defining the requirements correctly is important. Following these questions help you to define the high-level requirements.

    Understanding the overall market of SaaS applications or products helps you define the appropriate business strategies for your SaaS startup. Also, you get a proper understanding of how to build a SaaS product that has demand eventually in the competitive market. Let’s move to the next step which is shortlisting to find the right SaaS application development partner.

  2. Shortlist Software Development Companies to Build Your SaaS Product

    As you have shaped your SaaS product idea, now you need to find a reliable and technically efficient SaaS company that helps you with product development. Here are the key areas to look at while finalizing your software development partner.

    • Network in SaaS industry groups, attend SaaS-focused events or reach out to peers who have already been through the process of finding trustworthy companies.
    • Conduct research into forums, check industry reports, and specialist review platforms like Clutch, GoodFirms, and G2 to get a comprehensive view.
    • Check the portfolios of the best software development companies to learn how they solved specific challenges or build innovative solutions.
    • Find companies with repeat clients which suggest reliability and consistent performance during every project they built for their clients.
    • Understand the process of the companies for incorporating feedback, which tools they use for communication, and how efficiently they manage SaaS projects.
    • Check which hybrid engagement hiring models they provide for better flexibility.
    • Learn and include companies that offer clear cost breakdowns, minimizing the chances of hidden or unexpected charges.

    By following these steps, you choose a company which is more than just a vendor who built your project; they are a partner in your SaaS journey. Your decision requires a rigorous approach and cursory attention when finding a reliable partner.

    A detailed assessment, based on the above pointers ensures your SaaS product is built on a basis of technical expertise. Your software development partner comes on board and validates your idea, a step pivotal to realizing the tangible potential of your SaaS concept.

  3. Want to Build Your SaaS Product?

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  4. Validate Your Idea and Get Consultation From Software Company

    Next, let’s say you partner with us. Within this stage, it’s time to validate your SaaS product idea. As your SaaS product development partner, we help you with evaluation and validation. Now, our business analyst follows the below process for validating your SaaS product idea.

    • Conducting surveys, group discussions, or one-to-one interviews to engage with potential users to understand their pain points.
    • Studying the market in detail to understand and inspect competitors helps to find unique opportunities and identify gaps in your proposed SaaS solution concept.
    • Deciding the USP of your concept that helps you to build a brand and market your SaaS product in the market.
    • Assessing your SaaS product idea to check feasibility and viability to know if it’s technically achievable and prepare a plan for challenges if any occur.
    • Create a (minimum viable product) MVP plan for your SaaS idea and plan to launch the MVP version first to know the initial user response, and then identify the improvements.
    • Understanding and researching the regulated industry regulations that need to be followed if your SaaS idea belongs to specific industries like healthcare or finance.
    • Understanding the potential revenue, costs, and profitability of your idea which is essential for any SaaS business model app idea.
    • Deciding how your SaaS app will generate revenue, whether it’s a freemium model, subscription model, or a one-time purchase, and pricing strategy is also considered during validation.

    These are the important points that your SaaS app development company follows to help with validating your concept. Further, the company lets you know if your idea is viable for further development or requires changes at the initial stage or how it can be improved. Once your idea is validated, the next business plan is prepared for your SaaS product idea.

  5. Develop a Business Plan and Select Tech Stack of Your SaaS Product

    This step is the core part of your SaaS app development journey which is creating a business plan and choosing the right tech stack for your product’s success. Having a plan helps you to determine how your SaaS app will function, scale, and integrate with other technologies. To provide you with a detailed idea of this step, here are the points.

    • Clearly lay out your SaaS product’s goals which include the short-term to the long-term vision.
    • Outline how you will reach your target audience, including channels, budget allocation, and ROI projections for your SaaS software.
    • Creating your daily operational strategy by deciding upon the daily operations, from customer support to content creation and updates.
    • Identify potential obstacles and pitfalls, and create strategies to mitigate or manage risks during your SaaS development.
    • Understand your target audience’s size, preferences, and potential growth to carve out a specific niche.
    • Choose whether to deploy on the web, mobile, or both, considering your audience’s preferences.
    • Decide on programming languages and frameworks. Popular choices include Node.js, Django for the backend, and React, Angular for the front end.
    • Opt for SQL databases like PostgreSQL or NoSQL databases like MongoDB, depending on data structure needs.
    • Consider cloud computing technologies such as AWS, Azure, or Google Cloud to leverage scalability and reliability.
    • Ensure your SaaS technology stack supports seamless integrations with third-party services and tools which is crucial for your web app.

    By carefully preparing your business plan and selecting your tech stack, you lay a solid foundation for your SaaS product’s success. With this blueprint, you develop confidence in your potential investors and stakeholders. As you finalize these crucial steps, your next phase awaits: wireframing and examining the realm of UI/UX design.

  6. Create Wireframe and UI/UX Design of Your SaaS App

    In this fifth step, the visual and functional essence of your SaaS product is done. As your dedicated software development partner, we aim to bring your business idea to life by crafting a user-friendly and aesthetically appealing interface. Here are the steps we follow for creating an appealing wireframe and UI/UX for your SaaS development.

    • Sketching initial wireframes to depict the basic layout and structural blueprint of your SaaS application.
    • Utilize tools like Sketch, Figma, or Adobe XD for high-fidelity interactive prototypes, providing a closer feel to the finished product.
    • Define and standardize a colour palette, typography, and visual elements that align with your brand identity.
    • Design the user journey, ensuring seamless navigation and intuitiveness across the application.
    • Prioritize user experience, ensuring the design resonates with your target audience’s preferences and pain points.
    • Collaborate with developers to ensure designs are feasible and align with the chosen tech stack.
    • Engage in usability testing with potential users to gather feedback and ascertain areas of improvement.
    • Consider accessibility guidelines to ensure inclusivity for all potential users, including users with disabilities.
    • Refine and iterate designs based on feedback, industry best practices, and emerging user needs.

    By creating a solid wireframe and user interface for your application, we shape your product that’s not only visually appealing but also functionally robust. Preparing an impeccable UI/UX is critical to the success of your SaaS app. Once your design is finalized, the core part of the SaaS software development process starts.

  7. Development of Your SaaS Software Solution

    At this stage, our software development team starts with your SaaS application development. This is the phase where your validated idea and designs of your SaaS transform into tangible software. As your trusted software development partner, our priority is to ensure that your application isn’t just code-perfect but also meets the broader business and user goals. Here are the steps we follow to code your SaaS application and bring it into real-time.

    • Setting up development environments, tools, and repositories to ensure a streamlined workflow.
    • Breaking down your SaaS software product features into manageable tasks or sprints using agile methodologies like Scrum.
    • Using the chosen tech stack, develop the server, database, and application logic ensuring scalability and security.
    • Building interactive user interfaces which align with the wireframes and UI/UX designs provided.
    • Communication between the front end and back end through robust API endpoints.
    • Incorporate necessary third-party tools, multi-factor authentication, plugins, or services, vital for enhanced SaaS functionality.
    • Improve code efficiency, reduce redundancies, and ensure the software is optimized for the best performance of your SaaS platform.

    Through accurate planning and methodical execution in the development phase, our project manager ensures your SaaS product is robust, scalable, and primed for market success. Within the next step, software testers of our expert development team thoroughly test your cloud-based solutions.

  8. Testing and Quality Assurance of SaaS Solutions

    Further, our testing team ensures your SaaS application functions well. To make your SaaS application perform well, we test your cloud-based software from different aspects. If any bugs are detected, our SaaS developers fix them and aim to provide the best software that stands your decided requirements.

    • Craft a comprehensive testing strategy tailored to your SaaS project, detailing key methodologies and objectives for the most precise outcomes.
    • Establish a test environment that mimics production settings, ensuring every test replicates real-world scenarios accurately.
    • Ensure all core features of the SaaS solution work flawlessly, adhering to the predetermined specifications and functional requirements.
    • Actively search for and mitigate security vulnerabilities, prioritizing the safeguarding of your SaaS application against threats and unauthorized intrusions.
    • Assess how the application fares under varying user loads, ensuring its scalability, responsiveness, and overall performance stand up to real-world demands.
    • Confirm seamless interactions between integrated systems, ensuring third-party tools and APIs collaboratively function without hitches.
    • Through engagement with real users, refine the application to match end-user expectations, focusing on its intuitiveness and overall user experience.
    • Harness advanced tools to identify, prioritize, and efficiently resolve any issues, ensuring the robustness and reliability of the application.

    With our rigorous testing methodologies, we ensure that your SaaS product is market-ready, robust, and functions seamlessly. Once the SaaS products are built and rigorously tested, then they are deployed on the cloud servers. Let’s learn how the cloud-based SaaS application is deployed on the servers which becomes accessible to end-users around the users.

  9. Deployment & Post-launch Monitoring/Maintenance

    In this step, once the testing of your software as a service (SaaS) software is executed, further, we start the process of deploying your cloud-based SaaS software on your decided cloud services platform. We ensure to deliver your SaaS software smoothly on cloud servers with minimal disruptions. Further, once the deployment is done, we continuously maintain and monitor your application.

    • We ensure glitch-free deployment on platforms like AWS, Azure, or Google Cloud, promising minimal downtime with automation.
    • Post-launch, our tools actively monitor your application, addressing inconsistencies in real-time.
    • We champion feedback-driven improvements, refining your SaaS based on user reviews.
    • Prepared for unpredictable user growth, we can quickly adjust resources for optimal performance.
    • Amidst rising cyber threats, we constantly update your SaaS’s security, shielding user data and brand reputation.
    • Our agile team promptly addresses any inevitable bugs, minimizing user disruption.
    • We proactively upgrade your SaaS, aligning with market trends and tech advancements.
    • Committed to post-launch care, we offer cost-efficient maintenance without compromising performance.
    • With 24/7 availability, our support team ensures your users face no service interruptions.

    This is the entire SaaS development process we follow to bring your life into a real-time product. By following this entire process, we create powerful, reliable, and robust solutions. Now, you might be thinking about the costs of SaaS applications, right? Let’s learn about it in the next section.

How Much Does It Cost to Build a SaaS Product?

The average cost to build a SaaS application or product ranges from $11,000 – $33,000 for a basic version. Overall, the cost depends on multiple factors of SaaS development, such as scope, complexity, architecture, cloud environment, third-party services, and location of a SaaS developer/developers you hire for your entire project.

If you want to learn in detail about the cost of SaaS product development, read our dedicated guide on the costs of SaaS application development. Next, let’s learn about the top examples of SaaS products or applications.

5 Best Examples of SaaS Applications

Here is a table that provides insights into the top examples of SaaS applications. By going through this table, you learn about the top SaaS companies and their products, features, and design, and why these apps are well-known worldwide.

Name of SaaS ApplicationPrimary FunctionNotable FeaturesSaaS Company
Customer Relationship Management (CRM)
  • Comprehensive customer profiles
  • Customizable dashboards/reports
  • Automated marketing tools
  • Territory & quota management
  • Advanced AI with Einstein Analytics
  • Multi-channel support, Inc.
Team Collaboration & Communication
  • Organized conversations
  • Video/audio calls
  • Workflow builder (automation)
  • Secure data protection
  • Compliance standards
  • Integration marketplace
  • Advanced search for messages/files
Slack Technologies
Cloud Storage
  • File synchronization across devices
  • File recovery & version history
  • Password-protected links
  • Offline access to files
  • Smart Sync
  • Real-time collaboration with Dropbox Paper
Dropbox, Inc.
Video Conferencing
  • Breakout rooms for group activities
  • Recording & transcripts
  • Virtual waiting rooms
  • Calendar integration
  • Interactive polls & Q/A feature
  • Encryption & security controls
Zoom Video Communications, Inc.
Marketing Automation
  • SEO & content strategy tools
  • Landing page builder
  • Campaign performance analytics
  • Social media suite
  • Lead management
  • Integration with other apps
HubSpot, Inc.

Want to Hire SaaS Developers for Your Project?

We have a team of experienced software developers, engineers, and testers who have expertise in converting ideas into reality.

Do you still have doubts regarding SaaS development or SaaS business model? Check our FAQ section.

FAQ About SaaS Product Development

  1. How to license a SaaS Product

  2. Here is the method for licensing your SaaS application.

    • Determine the type of license that best aligns with your business model.
    • Opt for subscription-based, per-user, feature-based, or tiered licensing.
    • Define user rights, limitations, and responsibilities.
    • Ensure software protection and control over distribution.
    • Use software to generate and manage unique license keys for users.
    • Simplify the renewal process to enhance user retention.
    • Evolve licensing terms based on feedback and market trends.
  3. How to convert an existing app into a SaaS business model

  4. Here is the process you need to follow to convert your idea into a SaaS model.

    • Choose a migration approach and resign your app to support multi-tenancy architecture.
    • Hire SaaS software engineers who help you to switch your app to a new delivery model.
    • Choose a cloud provider to host your SaaS application.
    • Migrate your app ensuring seamless data exchanges to cloud databases.
  5. How long does it take to build SaaS software?

  6. The average time to build a basic or micro SaaS software ranges from 3 – 6 months. However, the timeline could change depending on various factors like scope, complexity, and the experience of your hired SaaS software, third-party integration, and the tech stack chosen for your SaaS application development.

  7. Where to hire SaaS software developers for my project?

  8. Here is the list of popular and trusted websites to hire SaaS software engineers and developers.

    • Space-O Technologies
    • Upwork
    • Toptal
    • PeoplePerHour

Let’s Build Your SaaS Product Together

Building a successful SaaS product is a meticulous journey that demands a clear vision, the right technical partnership, and continuous market alignment. Here is a summary of the overall steps crucial for your SaaS product development.

  • Vision & Validation: Understand user pain points and ensure your solution fills existing market gaps.
  • Technical Expertise: Choose a development partner with a track record of SaaS excellence.
  • Iterative Development: Prioritize user feedback, security, and adaptability at every stage.

Are you looking to build your own SaaS product? Want to hire a dedicated team of SaaS developers? Contact us. As a leading software development company, we have experience building 300 custom software solutions from enterprises to start-ups. Remember, with the right steps and commitment, your software solution can be the next big thing. Ready to start your SaaS journey? Let’s build together.

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Rakesh Patel

Written by

Rakesh Patel is the Founder and CEO of Space-O Technologies (Canada). He has 28 years of IT experience in business strategies, operations & information technology. He has expertise in various aspects of business like project planning, sales, and marketing, and has successfully defined flawless business models for the clients. A techie by mind and a writer at heart, he has authored two books – Enterprise Mobility: Strategy & Solutions and A Guide To Open311

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