The "stair-step method" mitigates the dual complexity of building and marketing a SaaS from scratch. By first launching a simpler add-on within a marketplace like Shopify or Heroku, founders can leverage a built-in marketing channel, allowing them to master the technical and product challenges of SaaS.
Startups often fail to displace incumbents because they become successful 'point solutions' and get acquired. The harder path to a much larger outcome is to build the entire integrated stack from the start, but initially serve a simpler, down-market customer segment before moving up.
Instead of building a consumer brand from scratch, a technologically innovative but unknown company can license its core tech to an established player. This go-to-market strategy leverages the partner's brand equity and distribution to reach customers faster and validate the technology without massive marketing spend.
When deciding between deepening a vertical, adding adjacent ones, or going horizontal, analyze two key factors: the extent of product modification needed and your ability to market and sell to the new audience. This framework simplifies a complex strategic choice.
Bootstrappers lack the capital and time to establish a new market category. A better strategy is to anchor your product in a known category (e.g., "site audit tool") and then use your unique features (e.g., "that also fixes the issues") as a key differentiator.
Don't force your sales team to learn and sell a completely new product. Instead, integrate the new capability into an existing, successful product, making it "first" or "default" for that channel. This reduces sales friction and complexity, leveraging established momentum for adoption.
Unlike info products, you can't just "sprinkle marketing" on a SaaS product post-build. SaaS requires solving a real pain point to prevent churn. Great marketing for a product nobody wants simply accelerates its demise by exposing its lack of product-market fit more quickly.
Jumping to enterprise sales too early is a common founder mistake. Start in the mid-market where accounts have fewer demands. This allows you to perfect the product, build referenceable customers, and learn what's truly needed to win larger, more complex deals later on.
Aspiring founders often obsess over creating unique intellectual property (IP) as a moat. In reality, for most bootstrapped SaaS companies, competitive advantage comes from superior marketing, sales, and positioning—not patents or secret algorithms. Customers choose the best tool that solves their problem, not the one with the most patents.
Enterprises are comfortable buying services. Sell a service engagement first, powered by your technology on the back end, to get your foot in the door. This builds trust and bypasses procurement hurdles associated with new software. Later, you can transition them to a SaaS product model.
Releasing a minimum viable product isn't about cutting corners; it's a strategic choice. It validates the core idea, generates immediate revenue, and captures invaluable customer feedback, which is crucial for building a better second version.