There are two different types of micro SaaS companies you might want to create: a micro SaaS business or a micro SaaS start-up. Although some people might think the differences between the two types of companies are minimal, businesses and start-ups are actually vastly different models, and each option is a better fit for different types of micro SaaS teams.
If you’ve decided to found your own micro SaaS start-up, you may be wondering where to begin. What should you focus on? How will you find your niche? And most importantly, what makes a micro SaaS start-up successful?
Below, we will highlight more information on what sets up a micro SaaS start-up for success. Then, we’ll highlight seven of the most successful micro SaaS start-ups to give you some inspiration and tips as you start your journey.
What Is Micro SaaS?
Micro SaaS has become very popular in recent years, but many people are still unclear on what exactly this term means. Generally, micro SaaS is the same as traditional SaaS, or “software-as-a-service,” but on a much smaller scale.
Tyler Tringas, the founder of popular micro SaaS solution StoreMapper, is credited with coining the term micro SaaS. He defines it as:
“A SaaS business targeting a niche market, run by one person or a very small team, with small costs, a narrow focus, a small but dedicated user base, and no outside funding.”
Traditional SaaS caters to a wide audience. It refers to any software that’s available for purchase on a subscription basis, rather than a one-time fee. The most popular example of a traditional SaaS product is Microsoft Office. Users pay monthly or annually for continuous access to Microsoft Office, and any available updates are included in the subscription cost.
Micro SaaS, on the other hand, caters to a very niche market. These companies use a “less is more” approach to create a simple product that solves a specific problem unique to their particular industry, thus building a very dedicated user base.
The Difference Between a Business and a Start-Up
Before we delve into what exactly makes for a successful micro SaaS start-up, we need to discuss the differences between a business and a start-up. You’ve probably heard a lot about start-up businesses in recent years, especially in the tech world. But, what exactly differentiates a micro SaaS business from a micro SaaS start-up?
In general, the main differences between businesses and start-ups include:
- Growth intent
- Level of risk
- Funding type
Let’s discuss these differences in more detail.
Growth Intent
When someone starts a business, they’re typically looking to grow slowly, gradually adding resources and team members as it makes sense for their bottom line. You won’t see many new businesses quickly adding team members, moving to a bigger office space, or working to disrupt the current market.
Start-up founders, on the other hand, are typically looking to grow as much as possible as quickly as possible. They tend to invest a significant amount of resources into their operation before any return on investment even begins in an effort to highly impact their current market and establish themselves as a big player in the industry.
Level of Risk
As nearly everyone knows, there’s a level of risk involved with any business venture. There’s always a chance things won’t work out, and traditionally, business owners work to mitigate their risk level by growing slowly, investing gradually in new ventures, and careful planning throughout their business’s life.
The level of risk involved in building a start-up is much higher than that of starting a business. Founders look for investors who can provide a large amount of capital in the early stages of development in exchange for an ownership stake. They begin expanding as soon as possible to build the biggest and best company they can, as quickly as they can.
While business owners typically have a solid business model that they stick to from the early days of development, a start-up’s business model generally changes over time. They try out new things to see what works best, then adjust their plans accordingly.
The level of risk involved with creating a start-up is the main reason why we see so many failed start-up businesses. To be successful in this industry, you need to not only act quickly but act smartly as well.
Funding Type
Another main difference between a start-up and a business is the way the venture is funded. Businesses are typically funded through savings, loans, and lines of credit taken out by the owner. Conversely, start-ups are often funded by wealthy investors who offer a large amount of capital to the founder in exchange for an ownership stake in the company.
This is often the reason why, while businesses are owned by the same person or entity throughout their entire existence, the main stakeholders in a start-up change often. Whoever provides the most capital usually ends up as the majority owner, leading to frequent changes in control, and as a result, frequent changes in a start-up’s business plan.
Qualities of Successful Micro SaaS Start-Ups
Before you begin your own micro SaaS start-up, it’s helpful to understand what has helped other start-ups find success in the past. While every micro SaaS start-up is different, there are a few things all successful ventures have in common. These include:
- Simplicity
- Little to no competition
- Offering a great solution to a well-known problem
Below, we will explain each of these qualities in more detail and give you some advice on how to implement them into your own start-up.
Simplicity
At its core, micro SaaS provides a simple solution to a niche user base. You’re not looking to pull out all the bells and whistles, all you need to do is offer a sufficient solution to a specific problem in a user-friendly way.
It’s important to remember that, even though most micro SaaS ideas are technology-based, not all of your users will be tech wizards. Avoid any fancy, complicated measures that could turn those less tech-savvy users away from your business.
On the other side of things, your idea should be relatively simple for your start-up to maintain. Since you’re not looking to offer your products to a wide user base, your monthly profits may be low compared to traditional SaaS start-ups. It should never take a lot of resources, whether that’s capital or manpower, to keep the start-up running long-term.
Little to No Competition
Again, it’s important to remember that you’re working with a very small target audience. For this reason, even one competing company can be too much competition for your start-up to become successful.
Ideally, you’ll find a problem that everyone in your target audience is aware of, but no one is talking about or offering a solution to. However, some start-ups do have success solving a problem that other companies are already addressing.
But, it’s important to keep two things in mind when competition becomes involved: the micro SaaS product you’re offering needs to be either five times cheaper or five times better than what everyone else is offering.
A Great Solution to a Well-Known Problem
The old saying goes, “if it ain’t broke, don’t fix it.” This statement applies to many things in life, including micro SaaS.
There’s no point in creating a product that solves a “problem” that your target audience does not see as a problem. Research is essential when you’re narrowing down the list of potential products you’re considering. Talk to people within the niche you’re looking to break into, and see what problems they’re having, no matter how minor, with their industry.
If more than a few people mention the same thing, it’s a good sign that that’s the problem you should be working on. You want to become that saving grace for established players in the industry, then build on that success for those just starting out.
Over time, establishing a great solution to a well-known problem will make you a key player in whatever niche you’re focusing on, helping you build a small but very dedicated audience.
Top 7 Successful Micro SaaS Start-Ups
Now that we’ve highlighted some information on how you can start your own successful micro SaaS start-up, it’s time to look at how these tips have helped others succeed in the same way.
There’s no better way to find the tools for success than seeing how other people have found them in the past. Below, we will highlight seven of the most successful start-ups in the micro SaaS industry, which you can further research to find more tips to help you in your venture.
S3stat
S3stat was created by Jason Kester, who had a goal of making a recurring income while minimizing the time he actually spent working. S3stat is a micro SaaS product that translates detailed server access logs, then translates them into easy-to-read statistics, reports, and graphs.
This tool is targeted toward businesses that use cloud hosting. It helps them track their cloud usage through readable reports and graphs that help them identify areas in which they can lower their cloud hosting bills.
All reports generated through S3stat are easily shareable, but also highly protected. Only those who you invite to do so will be able to access your cloud server reports. S3stat is available for a free 30-day trial, then a low price of $10 per month.
Send To My Cloud
Send To My Cloud allows users to create a dedicated webpage where others can upload any type of file, including videos, photos, and PDFs. The files uploaded will be automatically uploaded to your Google Drive or Dropbox account.
This service is a lifesaver for any company or individual who often needs to send or receive files that are too large to send via email. Each file is encrypted for secure access, and files are transferred to your cloud storage account as soon as they are uploaded.
There are three different subscription tiers available through Send To My Cloud:
- Basic ($9.99/month)
- Professional ($29.99/month)
- Enterprise ($59.99/month)
Each subscription comes with a 30-day money-back guarantee. Benefits of upgrading to a higher-cost plan include higher file size limits, more monthly transfers, and more cloud storage accounts.
Snappify
Snappify was created by Dominik Sumer and Anki Batsukh, who set out to create a tool that would allow developers to create easy-to-read, customizable code snippets to share with their followers and audiences.
Apart from creating appealing code snippets, Snappify also allows developers to easily annotate and explain different aspects of their code snippets to educate their audiences and present their latest findings. These snippets can be color-coded to allow for easier explanations, or simply to create better-looking presentations.
Snappify offers both a free and Pro version. The Pro version comes at an affordable cost of just $6 per month and comes with desirable features such as custom image uploads and edit histories.
Sheetsu
Sheetsu is a micro SaaS solution that allows businesses to easily turn Google Sheets documents into a database. It only takes a few minutes to set up, and you can then connect all your sheets to the web, mobile, or any API you’d like to.
Sheetsu’s goal is to take all the hard work out of setting up a website so owners can focus on creating. All you have to do is adjust your site’s data and content through Google Sheets, and the changes will appear on your website.
Signing up for Sheetsu is free. If you want a higher level of customer support or a larger number of monthly requests, you can upgrade to one of their three paid subscription levels: Basic, Premium, or Enterprise.
CookBook
CookBook is the perfect recipe management app for chefs and other cooking enthusiasts. It allows you to create your own personal cookbook by importing recipes from the internet or scanning pages of a physical cookbook through the app’s real-time scanning feature.
You can access your personal recipe organizer anytime, anywhere — online or offline. CookBook allows you to save up to 40 online recipes and scan five pages from cookbooks for free. Once you’ve reached those limits, you can upgrade to a paid plan. You can choose a monthly, yearly, or lifetime membership.
Testimonial
Testimonials are one of the best ways to build trust in your business among an online audience. Testimonial has created a micro SaaS solution that allows businesses of all types to gather and display customer testimonials easily on their site, through copied and pasted HTML code that’s supported on all platforms.
You can collect both text and video testimonials from customers, import them into your account, then get a unique pastable code within minutes to display them on any page of your site.
Testimonial offers a free subscription level, as well as a seven-day free trial on their three paid membership levels:
- Premium ($50/month)
- Ultimate ($150/month)
- Agency (Starts at $300/month)
The benefits of upgrading your account include more testimonials on your site and more account managers.
Segment
Segment is the perfect micro SaaS tool for any business looking to personalize its marketing communications. It allows you to collect customer data from both your website and any mobile apps you offer, then provides a complete data toolkit for your marketing team.
Personalized marketing is the best tool for engaging customers and driving more sales, and Segment helps you do so seamlessly. They offer a free membership level, as well as a 14-day free trial for their Team subscription level. Upgrading to their highest membership tier, Business gives you data on more visitors each month, as well as more integrations.
Conclusion
Start-ups are high-risk businesses, but the potential rewards often outweigh the risks. If you’re considering creating your own micro SaaS start-up, keep the above tips in mind and research what’s worked for start-ups in the past to ensure your venture is successful.
