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Comment by cj | Hacker News Reader

> Just go sell $2-4k/mo SaaS to a medium sized traditional industry that has ancient, crummy software with a target customer employee size of 50 - 1,000 people.

I’ve successfully done exactly this.

Except in order to get there, we had to spend 3-4 years selling cheap $29/mo self-serve plans at volume to iron out all of the kinks in the product and UX. Only after that were we able to go upmarket selling $40-90k/yr contracts.

It all boils down to the fact that customers paying $20k/yr or more have extremely high expectations across the board. It’s extremely difficult to just pop into a completely new market with a brand new product untested by anyone, and expect large companies to trust and buy from you.

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True and what I find funny is that the same companies are often willing to pay a lot of money to consultants that will deliver a shitty streamlit POC. Like they will literally pay consultants the equivalent of 4 years of new SaaS cost to get a POC instead of using a product with rough edges and grow with it. Expectations can be really dumb and confusing.

I'd pay to buy a bad house and then spend money to improve it, rather than paying a full rent for the same bad house and hoping that the landlord uses that money to improve it.

I don't get the comparison. are you comparing a SaaS that is doing 70% of the job and a shitty streamlit POC that no more than 3 people can use in parallel ??

They’re saying that they would rather pay a consultant because they would have control over fixing things that don’t work the way they want. Compared to the alternative of buying a SaaS product that is “rough around the edges” where you’re not able to directly control whether and how the product is improved over time.

that's a false choice because the SaaS startup will often be willing to modify the product to improve it for customers

It can but it's up to its good will.

To be clear: It usually makes no sense to develop an internal solution when there is an estabilished offering on the market. If there isn't, embracing an rough and incomplete Saas solution from a startup may work, but:

- You have no control on how the solution will evolve

- You don't own the solution (an internal solution can became a product on itself)

- You don't have any competitive advange (the money you pay are used to develop a product that benefit your competitors as well as you).

Exactly this!

Yeah exactly. You can't just roll out of bed one morning and grustle out a stable enterprise application. Also:

> customers paying $20k/yr or more have extremely high expectations across the board.

They definitely do, in certain ways. But also a lot of the software companies use sucks shit. But this part of the other comment cracked me up.

> a medium sized traditional industry that has ancient, crummy software

This is actually how to do it but the thing they're leaving out is that you have to already have knowledge of the specific industry and its players, their niches, and the software they use within them. You have to know where standards are high, and where the current options are bad, and how to market that improvement to the companies that are juuuust flexible enough to switch to your product while being conservative enough not to dump you if exactly one VP leaves.

Once you have all that in place, sure, you can "just" sell your software to them lol.

>This is actually how to do it but the thing they're leaving out is that you have to already have knowledge of the specific industry and its players, their niches, and the software they use within them.

In most cases, this requires at least one former employee who used the crummy software. Most likely this person would be the one to identify the problem and propose an alternative solution.

Information like this is extremely valuable. It forms the core of the biz opportunity. Casual comments often overlook this.

Builders doing their own thing may not overlap with employees using office horror software 9-5.

Boiled down into 1 sentence: Create a company that solves a problem you’ve personally experienced.

(If you feel like you haven’t experienced any problems worth creating a company to fix, consider putting yourself in situations where you’ll be exposed to different/new problem sets)

Lol @ "office horror software". So apt.

Yes, get industry experience! You have to be pretty special to be just a software developer with no domain knowledge who can somehow make something more valuable than the bazillion other just-a-software-developers out there. I sell fairly high priced software to companies and I'm doing fine. Though I'm kind of lucky in how I got into it and by now most of my domain knowledge has come from my previous customers asking for things.

We experienced something similar - we were able to wrangle a $30k/year contract as one of our first contracts, but the expectations around the software were and continue to be incredibly high - we sort of wish he had had a few $100/mo customers first to iron out the UX, and just learn more about how to work with a midmarket/enterprise buyer.

Anyway we survived but we understand why companies move upmarket over time now haha.

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