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What is a SaaS Company and How Can You Start One

on 4 Nov 2025, by Veronica, in Blog, WordPress, Cloud, Guides

by Veronica

Want to know what a SaaS company is and how you can start one this year? SaaS is one of the businesses with the highest valuation.

According to Precedence Research, the global SaaS market is expected to more than triple over the next decade. Currently, it's worth around $408 billion. By 2034, it could grow to over $1.25 trillion.

If you can build and launch a SaaS company that solves a real problem, there’s plenty of room to grow, earn recurring revenue (this is the best part about SaaS), and succeed in the future.

You might be wondering:

What exactly is a SaaS company?
What features make SaaS valuable to an entrepreneur?
How do I build a successful SaaS business from the ground up?
How do you validate a SaaS business idea?
Which marketing strategies can you leverage for your SaaS startup?

Throughout this article, we’ll answer these questions and more, the best way we can. We’ll also walk you through practical steps and share tips to build, validate, market, and scale your SaaS company.

Let's begin by quickly running through what a SaaS company is.

What is a SaaS company?

TL;DR: SaaS stands for software as a service. Instead of buying the software and installing it on a computer, users pay to use the software online, usually through a monthly or yearly subscription.

A SaaS company is a company that builds the software and makes it available to customers over the internet.

The best part about starting a SaaS company? You build the software once and sell access to it repeatedly. That’s why so many entrepreneurs are drawn to it. It’s a scalable way to create steady, recurring income.

Here are a few well-known examples of SaaS companies:

Discord
Slack
Salesforce
HubSpot
Dropbox
Adobe
Canva
Brizy

You're probably signed in on one of these SaaS platforms or even more yourself because they solve a specific problem you face. Whether it's team communication, sales, CRM, marketing, or a simple way to build websites and landing pages.

So, what makes a SaaS company profitable and valuable?

What are the key features of a SaaS company?

Since it's a quick overview, we'll run down key features of a SaaS business and highlight its business value to you, if you're thinking of starting one:

Your software will be accessible online

Your users won’t have to install anything. All they'll need is an internet connection to sign up, log in, and use your product from anywhere. This implies you can reach a global audience and sell to them worldwide once your marketing and sales strategies start picking up. Besides, you'll worry less about devices, operating systems, or installations.

It’s subscription-based

Customers pay a monthly or yearly fee to use your software. You earn a steady income, and customers don’t have to make a big commitment to get started.

A SaaS business is built to scale

With SaaS, you can serve 10 to 10,000 users without changing much on your end. That’s why this business model is great for long-term growth.

It’s remotely hosted.

SaaS runs on cloud servers, not on local machines. If you build your own, you choose the hosting (AWS, Google Cloud, Azure, etc.) and have full control. That means you can run your business from anywhere. With a white-label or reseller model (like Brizy Cloud), hosting is handled for you — you get the convenience of remote access but not control over the infrastructure.

You can easily collect valuable data.

Most SaaS platforms come with built-in analytics and reports. You can see what users like, what they ignore, and where they drop off. This information can help you understand users’ behaviour, improve your product, reduce churn, and find new opportunities.

Built-in customer support

The service in SaaS is such a big deal for many customers. The best SaaS companies know very well that a good service gives customers real value. If you blow it, you lose clients. And in the realm of SaaS, you don’t want to lose clients. It’s called churn, and it is a bad thing.

FYI, happy users stick around longer and help you grow by word of mouth.

? Besides, a new customer you acquire by word-of-mouth has a 16-25% higher lifetime value than those you acquire from other sources.

Up next, we’ll talk about how you can build, validate, and scale a SaaS business.

How do you start and launch a SaaS company in 2025?

Flow chart highlighting 10 steps to start a SaaS company

Step 1: Identify a Problem and Validate It

Most successful SaaS businesses start with one thing: a real problem. And the best products don’t reinvent the wheel. They solve a pain point better than existing options.

Take Brizy Cloud as an example.

Back in 2018, we launched as a WordPress page builder, aiming to make website creation simple and user-friendly. But as more people used it, we noticed a recurring issue: users still struggled with WordPress hosting, security, maintenance, plugins, and updates.

That pain point led to the launch of Brizy Cloud: a managed SaaS platform where users can build websites in the Cloud without worrying about hosting, SSL, CDN, maintenance, or speed optimization. Today, it powers over 300,000 projects.

We didn’t set out to reinvent websites. We saw a problem and built the best solution we could. Your SaaS journey should begin the same way: by spotting a problem and validating that it matters.

Ways to identify potential problems worth solving

Listen to client conversations, feedback, and reviews.
Spot gaps in your niche. Sometimes, opportunities are hidden in plain sight.

Focus on problems you understand personally. This way, you’ll be able to solve it better than anyone else. In addition, you’ll be more motivated and resilient when challenges arise.
Use your expertise to solve problems others can’t.

Step 2: Conduct Market and Competitive Research

Finding a problem is step one. Step two is making sure people are willing to pay for a solution. That’s the goal of market research: to validate demand and size up the opportunity.

Start by asking yourself: “Who exactly are you solving this problem for?” Once you’ve defined your target audience, look deeper:

Are they already paying for similar tools?
What frustrates them about current solutions?
Are they actively looking for something better?

You don’t need a big budget to do this. Scan competitor reviews, Reddit threads, Facebook groups, or Discord communities in your niche. Collect insights on:

Market growth
Who spends the most on software like yours
Emerging trends in your industry

Look at your competitors as well

At Brizy Cloud, we noticed some of our users were overwhelmed by WordPress. But we weren’t alone. Other tools like Webflow, Wix, and Carrd proved that demand for simpler website builders was growing.

FYI, the presence of competitors in your market is actually a good thing. It means a real problem exists.

The opportunity lies in identifying where your competitors’ solutions fall short and delivering something better.

Step 3: Define Your ICP and Value Proposition

Once you’ve confirmed demand, it’s time to get specific. That means defining your Ideal Customer Profile (ICP) and crafting a strong Value Proposition.

Your ICP isn’t “anyone with the problem.” It’s the subset of people who feel the pain most, are motivated to solve it, and have the budget to pay for a solution.

Ask yourself:

What industry or niche are they in?
What size of business or team do they run?
What tools are they currently using?
What frustrations or goals do they repeatedly bring up?

Define your value proposition

With your ICP defined, shape your value proposition. Your value proposition is basically a clear, simple statement that explains why your product is the best solution for them. Focus on outcomes, not features.

Here's a simple formula you can use:

For [ICP], who struggle with [main problem], [your product] is a [solution type] that helps them [achieve key benefit] better than [competitors].

That’s it. Defining your ICP and value proposition early keeps you from building for “everyone” and ensures you focus on customers most likely to adopt, pay, and recommend your product.

Step 4: Build a Prototype / No-Code MVP

Before investing in full development, start with a prototype. This is a simple mockup that helps you visualize and communicate your idea.

You can sketch it on paper or use tools like Figma, Balsamiq, or Adobe XD to create wireframes. The goal isn’t to build yet. It’s to see how the product might look and function, and to share it with others for feedback.

Validate your concept with a landing page

So, if there’s any step you shouldn’t skip, it’s this one: validation.

The whole point of validating your concept is to confirm whether your business idea has real market demand, an interested customer base, and, most importantly, whether they’d pay for it.

One of the easiest ways to validate demand is to launch a landing page that:

Describes the problem and your proposed solution
Shows how your product is different from existing options
Explains why it’s valuable
Let's people sign up for early access (or even pre-order)

You don’t need a developer for this. We recommend Brizy Cloud for a bang job. It lets you spin up a professional landing page in minutes without coding or worrying about hosting. This tool is perfect for testing ideas quickly to prove if there’s real customer demand.

Need help creating a landing that truly converts? Check out our guide on how to build a high-converting SaaS landing page and then optimize it.

If people are willing to share their email, or better yet, pay, that’s real validation.

Note: From this step onwards, the principle is simple: sell first, build second. If people sign up, subscribe, or buy, that’s your green light to keep going. If not, refine your problem, your target audience, or your message before moving forward.

Step 5: Develop and Launch Your MVP

Once people have shown interest, it’s time to create your Minimum Viable Product (MVP).

An MVP is the simplest working version of your product. It doesn’t need every feature you’ve imagined, just the core functionality that solves the main problem. Keeping it lean reduces costs, speeds up your launch, and gets your idea into the market faster.

Here’s how to approach it:

Start lean. Build only one or two essential features.
Use no-code or low-code tools (if possible). This helps you launch faster without heavy development costs.
Ship quickly. Get your MVP into users’ hands as soon as possible.

Why is creating and launching an MVP important?

Because it’s the best way to test your idea in the real world. Instead of guessing what people want, you’ll see how they actually use your product. Early users will show you:

What they value most.
What frustrates them.
Which features matter, and which don’t?

This feedback guides your next steps. You’ll use it to iterate, improve what works, fix what doesn’t, and gradually expand your product into the SaaS you originally envisioned. That’s how you go from an idea to a full SaaS product people truly love.

Remember: the goal of an MVP isn’t perfection. It’s to validate your solution and guide your next steps with real-world data.

Step 6: Choose a Pricing and Monetization Model

Pricing your SaaS isn’t always straightforward. If you set it too low, people may not take your product seriously. Set it too high, and many won’t even try it. The right pricing model balances perceived value, user psychology, and your business sustainability.

What are the common pricing models in SaaS?

The following are the most common SaaS pricing models you can explore:

Subscription-based. Customers pay monthly or yearly to keep using your product. This is the most popular model and provides predictable, recurring revenue.
Freemium. Offer a basic version for free, then charge for premium features. This works well if you want to attract users quickly and convert them over time.

Flat rate. One price gives access to all features. Simple to understand, but may not fit if your users have very different needs.
Lifetime deal. A one-time payment for unlimited access. Great for raising early funds and validating demand, but it limits long-term revenue. But you'll want to be careful because you get paid once.

Other common pricing models include usage-based, per-user, or tiered pricing. Each model can work depending on your product and audience.

How do you pick the right price?

Before you settle on a pricing strategy, start by checking what similar SaaS products charge.

Study competitors. Look at what similar SaaS tools charge and the models they use. This shows you what customers already expect in your space.

For example, most SaaS tools use monthly subscription plans. If that’s the norm in your niche, it might make sense to follow that model at first, then tweak it later based on user feedback.

Consider costs. Moreover, factor in what it takes to run your product each month and how long it should take to recover your investment. Your price should at least cover these basics while leaving room for growth.
Test and adjust. Your first pricing model doesn’t have to be perfect. Launch with a reasonable price, then refine it as you learn from real users.

Key takeaway: Pricing isn’t just about covering costs. It’s about signaling value and aligning with how your audience prefers to pay.

Step 7: Set Up Go-To-Market (GTM) Strategy

You can build the smartest SaaS product in the world, but without a way to reach users, it won’t grow. A Go-To-Market (GTM) strategy is simply your plan for how people discover, try, and pay for your product.

In the early days, don’t overcomplicate things. Most founders often try different channels, see what clicks, and then double down on the one that works best.

Marketing strategies:

Here are some practical GTM approaches to test:

Start with social media marketing and online communities

Post updates, answer questions, and join discussions where your audience already spends time, like Twitter (X), LinkedIn, Reddit, Facebook groups, or niche forums. Consistency is key. Even showing how you’re building the product can attract early users.

The idea here is simple: try everything, then focus on the one channel that gets the most traction.

Quick tip: If you already have a significant number of followers on a platform, start there before branching out.

Create educational content

Blog posts, videos, and guides that solve real problems do more than market your SaaS. Creating this kind of content builds trust. Instead of just highlighting features, explain challenges in your niche and how your product fits into the solution.

Partner with influencers or affiliates

If creators already serve your target audience, partner with them. Offer free access or demos, collaborate on content, or create an affiliate program where they earn a commission for referrals.

Use early testimonials

Feedback from your first users is gold. Showcase short reviews or success stories on your landing and pricing pages. Positive social proof can make hesitant users take the leap.

Experiment with small, targeted paid ads

If budget allows, experiment with low-cost ads (e.g., $5–10/day) on Google or Facebook. Paid ads are a quick way to test messaging, landing pages, and conversion rates before scaling.

Invest in SEO (Search Engine Optimization) early

SEO takes time, but it compounds.

It won't bring instant results, but if you start early, you’ll thank yourself in a few months.

For example, you can use keyword tools like Google Search Console or Ahrefs to find what keywords your target users are already searching for. Then, create useful content around those topics.

You can also ensure your website follows on-page SEO best practices that search engines use to rank pages higher in SERPs. Over time, this can become your most reliable and consistent source of traffic.

Key takeaway: A GTM strategy isn’t about picking one “perfect” channel. It’s about experimenting, finding where your users actually respond, and focusing your energy there.

Step 8: Assemble Your Team

Even if you’re a solo founder, you’ll likely need extra hands to bring your SaaS idea to life. At the very least, you’ll want:

A UI/UX designer to map out wireframes, user flows, and mockups that clarify how the product should look and feel.
A developer to turn those designs into a working product with real functionality.

Quick note: If your user base starts growing quickly, consider adding customer support early on (in step 5). You can hire them full-time or part-time to ensure your early users are satisfied.

Where can you find talent?

You have two main options, depending on your budget.

On a budget? Try freelance platforms like Upwork or Fiverr for short-term hires.
Looking for top-tier pros? Explore Toptal or Dribbble.

If funds are tight, consider partnering with a developer from your network and offering equity, but only if they’re truly committed.

Step 9: Launch and Provide Customer Support

Once users get their hands on your product, expect bugs, questions, and feature requests.

Here’s how to handle it:

Make support easy to reach via email, live chat, or a simple contact form.
Respond fast. Show users you’re paying attention and taking them seriously.
Fix issues quickly by prioritizing bugs and usability problems.
Collect feedback. Use the feedback from users to shape your roadmap.

Great support doesn’t just solve problems. It builds trust, loyalty, and word-of-mouth growth.

Step 10: Plan for Scaling and Challenges

No SaaS grows without hurdles. What separates successful founders is how they handle them. Two big ones you should expect are churn and competition.

Churn happens when users sign up, try your product, and leave. High churn stalls growth. Causes might include weak onboarding, bugs, missing features, or a lack of real value. Run surveys or analyze user behavior to uncover the root cause, then fix it.

Competition is inevitable. Other SaaS tools will pop up, copy your features, or undercut your pricing. Your defense? Keep improving, double down on what makes you unique, and listen closely to your users.

Track the right metrics

But handling challenges isn’t just about reacting. You also need to track the right metrics to catch problems before they explode and to scale sustainably.

Focus on a few key numbers:

MRR. This is your monthly subscription revenue. It is a simple way to measure your growth.
CAC. This is the cost to acquire a customer. Keep it lower than what they’re worth.

Customer lifetime value (CLTV). This data can help you understand the long-term value of each user and guide your decisions around marketing, pricing, and customer retention.
Daily/monthly active users (DAU/MAU). This metric measures how often users actually use your product.

The point isn’t to track everything. It’s to monitor just a few metrics that show whether you’re growing, retaining users, and staying profitable.

Broadly speaking, scaling is a cycle: track, learn, iterate. Therefore, every challenge becomes a signal to improve. If you can adapt quickly and keep refining based on real data and user feedback, you’ll stay ahead no matter what obstacles come.

Conclusion

Starting a SaaS company offers you an opportunity to earn recurring income and reach customers worldwide as long as you have a solid product and a smart marketing strategy. This journey begins when you identify a real problem in your niche and build a solution for it.

In this guide, we’ve covered everything you need to get started, from:

Validate your idea with real people
Research the market and competition
Define your unique value proposition (UVP)
Building an MVP

Setting up your pricing strategy and model
Marketing your product without burning out
Assembling your team
Providing customer support
Preparing for challenges

Each step will take time, testing, and refining. Just take it step by step, learn from your users, and improve over time.

Using tools like Brizy Cloud can help you design landing pages and websites to validate your idea, attract early interest, and even start getting paying customers before you can start building your MVP.

How to start a SaaS company FAQs

Do I need to know how to code to start a SaaS business?

Not really. If you’re not a developer, you can team up with one as a co-founder and give them equity in exchange. Many successful SaaS businesses started this way. One person handles the product, and the other handles sales, support, and growth.

You could also explore no-code platforms, such as Brizy Cloud, Bubble, and Outsetta. These platforms allow you to build sophisticated applications, manage user authentication, handle payments, and even integrate with other services. More specifically, Brizy Cloud offers a white label solution that lets you resell websites and launch your own SaaS website builder without having to build one from scratch.

How much money do I need to start a SaaS company?

It depends on your approach. Teaming up with a developer as a co-founder can save you thousands of dollars. You trade equity instead of cash.

If you're building it yourself or hiring freelancers, you might spend anywhere from a few thousand dollars to tens of thousands, depending on the complexity of your product.

Want to avoid high upfront costs? Consider launching a smaller version first (a micro-SaaS), or using no-code tools to validate your idea before investing heavily.

How do I come up with the best SaaS idea?

Ideas can come from anywhere, like holding conversations with small businesses or clients. What really matters is how well you execute the idea. In fact, your original SaaS idea will likely evolve into something different once you start getting real customers and feedback.

One proven way to come up with a solid SaaS idea is to copy something that's already working and niche it down. Don't try to build the next Salesforce or Facebook right away. Instead, take a smaller, more focused problem and solve it really well for a specific group of people. That’s often how the best SaaS companies start.

What are some SaaS trends I should pay attention to in 2025?

In 2025, smart founders are taking advantage of:

AI features to personalize, automate, or enhance their tools.
White-label SaaS. This is where you can purchase unbranded SaaS software and put your own branding elements.
Micro-SaaS ideas that solve small, niche problems profitably for a small audience.

If you're starting out, keep these in mind. They can give you a major edge.

Do I need a business plan to start a SaaS company?

Only if you’re looking for funding or financing.

If you plan to raise money from investors or apply for a loan, you’ll need a proper business plan. But if you're bootstrapping, what matters most is having a clear idea of what you’re building, who it’s for, how you’ll get users, and how you’ll make money.

So yes, have a plan. But it doesn’t have to be formal unless you're pitching it to someone else.

What legal requirements do I need to handle when starting a SaaS business?

At the very least, register your business, get a proper domain, and have basic legal policies like terms of service and a privacy policy on your website. Ensure your branding doesn’t violate anyone’s trademarks. Then, as you grow, you might also need to handle: