SaaS - new software model, new challenges
Another interesting blog article on the the SaaS model, hosting, compensation, VC funding, cash flow, pricing and usability. Excellent read.
Sneak Preview:
- it takes 70% to 100% more capital to fund a SaaS company
- SaaS companies need an average of $35M in VC capital, versus $20M for a similar perpetual license company
- Engineers must design in user customization
- Hosting is a big deal
- How do software companies price their SaaS offerings?
SaaS pricing models need to be more transparent; one of the things that’s putting people off SaaS is confusion over its pricing. At Postcode Anywhere and its sister site TheWebService we try to keep the pricing models simple… it seems like an elegant solution to us, but we’d also like to know opinions on other pricing models and whether a PAYG-type system is seen as A Good Thing…also interested to see some of the other points expanded on!
I agree with you. Pricing should be kept simple for the end consumer. There are 2 choices - pay per account or pay per user per month. See this http://www.saasburst.com/2008/09/how-do-you-price-your-saas-offering/
Would like to hear your thoughts on this.
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