10 Proven Ways to Grow Your SAAS Startup Faster (2023)

10 Proven Ways to Grow Your SAAS Startup Faster (1)

Every startup looks for ways to catapult a business to success. Here are ten tips for accelerating growth for SaaS (software as a service) companies.

1. Sell the problem, not the product

There are plenty of SAAS startups that do various things. Some succeed and others fall away because they can’t sell a solution. Focus on the problem.

Apple did this with the iPhone by focusing on the shortcomings of competitors and introducing the solution as something magical. Identifying pain points for customers and offering a solution will be what really makes you stand out amongst competitors. Not providing another product for something they don’t realize they even need.

2. Start charging early

SaaS startups are often hesitant about charging customers. They think that their product is not yet ready, that it’s necessary to get traction and focus on expanding their customer base rather than on growing revenue.

Deep inside, however, they often don’t just have enough faith in their product and are not sure if someone will buy it at all. They prefer keeping hundreds or thousands of free users attempting to win a few serious customers. Big numbers are comforting but the product remains an unverified idea.

Building a product should imply increasing revenue. So don’t hesitate too much—put it to the test by charging and see if it works in the real conditions. This is one way to minimize your risk too. Instead of waiting to launch until you’ve invested huge amounts of time and money, launch early. If you fail or discover that you need to pivot, you haven’t lost all your effort. This is a good way to validate that your idea has traction in the marketplace.

People truly value only what they pay for. And by paying, people demonstrate they recognize your value. By charging early, you will drive away freebie collectors but serious customers will stay with you.

3. Narrow down your customer acquisition efforts

Often, time, effort, and money don’t bring the desired results. In fact, this may be a targeting problem, not a product problem.

Not everyone on this planet needs your product—and that’s normal. So, trying to market to everyone and anyone is simply a waste of resources.

(Video) Growth Hacking Strategy for SaaS Startups (How to Acquire 100K Users)

To achieve growth, you need to focus on a specific audience that is genuinely interested in your product value.

To identify your target market:

  • Ask yourself questions about your typical user’s gender, age, geographic location, business nature, pain points, interests, budget, and so on.
  • Research your competitors. Discover their keywords and ads for paid and organic search. You may use competitor analysis tools for this purpose, for example, SE Ranking.
  • Determine who they are targeting and appeal to the same audience or concentrate on another group that your competition leaves out.
  • Speak to people, attend your sector forums and events, and organize surveys and polls to narrow down your marketing focus.
  • Use website analytics tools (Hotjar and Google Analytics, for example) to see what visitors view on your website, which pages visit, and what content they are interested in, which will help you to understand what they really care about.

All this will enable you to define your customer personas and focus on their specific needs.

10 Proven Ways to Grow Your SAAS Startup Faster (2)

4. Experiment with pricing

Your pricing should evolve as your company evolves; it is not a constant. You can test your copy around pricing; you may find that the price is right, but it’s not attached to the right value.

Only by charging money and split testing various pricing levels can you understand people’s perception of your product and their readiness to pay for it. Some great split testing tools include Optimizely and VWO.

Your optimal price is when you have:

  • A relatively small percentage of people who complain that you are too expensive
  • Another small percentage that doesn’t hesitate at all before paying
  • The biggest category that says the product is quite expensive but they are ready to buy anyway because they see its value for their businesses.

In his book, “Selling the Invisible,” Harry Beckwith recommends raising prices until 15 percent to 20 percent of your qualified prospects resist this.

Generally, a higher price generates a perception of higher value. And people don’t price shop as much as you expect—they are well aware that something extremely cheap can’t be good and building good products inevitably involves costs.

Think of Apple products. They definitely don’t try to lower their prices. They use a WTP (willingness to pay) to form their pricing. This means they set prices according to the maximum that the majority of their target audience can pay, not the average and not the minimum. Of course, in this case, the product should really feel like a premium one.

5. Offer a transparent and easy-to-scale pricing model

Many SaaS businesses fail to acquire customers just because their pricing is too complicated.

Users simply don’t have the nerve to spend their time deciphering all options and layers in a messy presentation — so be clear. Ask your friends or a focus group to take a glance at your pricing page and evaluate its user-friendliness.

Also, it’s paramount to choose the right pricing model that enables businesses to predict costs and plan their budgets.

(Video) The Fastest Growing SaaS Startup in History | deel

For example, some CRM companies adopt per usage model and charge based on the volume of their user’s customer base. This means that the more customers you acquire by using the software, the higher your bill is. But this is the goal of many businesses to have a lot of customers and gain more continually. Within this model, it’s difficult to foresee and plan costs.

Another example is per-user pricing which depends on the number of people using the software. This model is quite transparent and simple. The users on subscription enjoy an unlimited activity and the company can easily forecast costs.

10 Proven Ways to Grow Your SAAS Startup Faster (3)

Offering monthly, quarterly, and annual pricing can be beneficial. Your end goal to increase growth is to lock in customers for a longer period of time at the annual tier and phase out price-cutting promotions whenever possible.

Other SaaS pricing models include: per active user, flat rate, tiered pricing, per active user, per feature pricing, freemium, and so on. For more on this, check out The Ultimate Guide to Choosing a Pricing Strategy for Your SaaS Startup.

Additionally, pricing is one of the top website pages where visitors have questions. If you use a live chat, set up an automated proactive message offering help.

10 Proven Ways to Grow Your SAAS Startup Faster (4)

6. Listen to your paying customers

People may say all kinds of nice things about your product or service—that they like your product, that they’ll promise to buy it, and so on.

But listening to all voices is a risk. In particular, don’t base your business on free users’ feedback (if you have them) because it’s likely to lead you astray—you’ll be improving your product for the wrong audience.

Of course, provide the best support to all of your users but develop new features for those who take your product seriously and pay you—because they provide you with insights that truly matter. You needed this type of validation when starting your business, and now it’s about repeating that process consistently to maintain and grow a target market.

7. Make big customers comfortable with your pricing

If you want to gain high-profile customers, your product shouldn’t be embarrassingly cheap for them. Imagine an industry leader using a piece of software that costs five bucks!

(Video) Top 10 Avoidable Mistakes SaaS Startups Make

Moreover, a low price creates an impression that your software is not fully reliable and your business may fold up at any moment.

Big players are careful in their choices: in addition to a great feature set, they expect impeccable service, accountability, security, maximum uptime, and so on — and are ready to pay for all that.

That’s why it’s advisable to add Enterprise pricing plans from the start. Even if your product is not yet ready for the Enterprise segment, you’ll be able to collect the requirements and expectations of the big buyers.

High-profile clients may also be looking for flexibility, think about providing custom pricing options to be able to satisfy their particular needs.

8. Exploit paid growth tactics

Some startups lose steam if they struggle to achieve quick growth — but sometimes their real problem is a lack of proper promotion.

Don’t fall under the illusion that word of mouth and organic growth is enough. Marketing plans and strategic sales initiatives are what make businesses actually grow.

It can seem like businesses everywhere are effortlessly scaling quickly to million (or billion) dollar revenue. Keep in mind that you’re looking at their growth from the outside — most likely, they’ve been on a strategic growth trajectory for years. In general, having a great product doesn’t mean marketing is redundant.

Paid digital marketing platforms are a good place to start. Use Google AdWords, Facebook Ads, and LinkedIn Ads, and run remarketing campaigns in Google and Facebook. People usually read reviews before purchasing anything so you can buy traffic on popular software review platforms like Capterra, GetApp, or G2Crowd. Also, consider using GDN — it has over 2 million sites and reaches over 90 percent of people on the internet.

You can read more about the various paid growth techniques here.

9. Partner with competitors

For early-stage SAAS startups, you may have plenty of smaller competitors and 1-2 larger established competitors.

Rather than fighting over an ever-shallowing pool of customers, it may be worth connecting with the competition to take on the big players. Sometimes combining forces can make for a larger impact and faster growth.

(Video) Growth vs. Efficiency: How to Weatherproof Your SaaS Startup for Tougher Times | Christoph Janz

10. Create great content

One of the most effective ways to get noticed in a competitive space is by giving out valuable but free information.

Write about what you know, your solution, and the industry you’re looking to revolutionize. Presenting your audience with great content will help win their attention and respect.


Growing a strong SaaS startup requires faith in your product, great flexibility, and smart market positioning.

The above tips will help you win over the right type of clientele, boost their perception of the value of your product, collect relevant feedback for better strategic decisions, effectively manage your sales funnel, and establish yourself as a thriving business much faster.

Editors’ note: This article was originally written in 2018 and updated for 2020.

Liudmila Ganzha

I am a passionate blogger, content marketer, and artist. Love sharing my experience and knowledge about customer success, ecommerce, content marketing, and startups. Feel free to contact me via email at liudmila7000@gmail.com, or on LinkedIn.

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  • - Elastic Infrastructure.
  • - Data Security.
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What KPIs most important for a SaaS? ›

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Stated simply, the Rule of 50 is governed by the principle that if the percentage of annual revenue growth plus earnings before interest, taxes, depreciation and amortization (EBITDA) as a percentage of revenue are equal to 50 or greater, the company is performing at an elite level; if it falls below this metric, some ...

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How do I get 10 new clients? ›

Take Action
  1. Send outreach emails.
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  3. Get on the phone with potential clients.
  4. Respond to inbound inquiries.
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  6. Attend local meetups.
  7. Interact in social media groups.
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  3. Engage in Live Chat. ...
  4. Utilize Gamification. ...
  5. Re-engage via Web Push Notification.

How do SaaS attract customers? ›

11 Ways to Attract New Customers to Your SaaS Business
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  2. Set SMART Goals. ...
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What are the 4 growth strategies? ›

The four growth strategies

These are Product, Placement, Promotion and Price. Where the Four Ps focus on audiences, channels & pricing, the Ansoff Matrix is more effective for a broader view of markets and uses the older Four P framework within each of the 4 Ansoff quadrants.

What are the three major growth strategies? ›

The four main growth strategies are as follows:
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  • Market development. ...
  • Product development. ...
  • Diversification.

What are the 4 key business strategies? ›

Four generic business-level strategies emerge from these decisions: (1) broad cost leadership , (2) broad differentiation , (3) focused cost leadership , and (4) focused differentiation . In rare cases, firms are able to offer both low prices and unique features that customers find desirable.

What is rule of 70 SaaS? ›

The rule of 70 is a calculation to determine how many years it'll take for your money or an investment to double given a specified rate of return. Investors can use this metric to evaluate various investments including mutual fund returns and the growth rate for a retirement portfolio.

What is the magic number in SaaS? ›

The SaaS magic number is one of the best ways to calculate your sales efficiency. The formula to calculate the SaaS magic number is “(Current Quarter ARR – Prior Quarter ARR) / Prior Quarter Acquisition Spend.”

What is a good monthly growth rate for SaaS? ›

According to a study by Bessemer Venture Partners, the average monthly growth rate for successful SaaS startups is 7-8%. This means that a company's revenue is increasing by 7-8% each month.

What is good growth for SaaS? ›

SaaS company growth rate depends much on a company development stage. On average, the revenue increase falls into the 15% to 45% year-to-year growth range.

What makes SaaS attractive investment? ›

Investors like SaaS companies because their subscription fees, which recur every month or year, make the revenues predictable. Well-run SaaS companies are also inherently scalable, as the cost of serving each customer goes down as SaaS companies grow.

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What are the 5 key performance indicators? ›

What Are the 5 Key Performance Indicators?
  • Revenue growth.
  • Revenue per client.
  • Profit margin.
  • Client retention rate.
  • Customer satisfaction.

What is rule of 40? ›

The Rule of 40—the principle that a software company's combined growth rate and profit margin should exceed 40%—has gained momentum as a high-level gauge of performance for software businesses in recent years, especially in the realms of venture capital and growth equity.

What is the SaaS rule of 78? ›

78 is the magic number when it comes to SaaS, to predicting the MRR (monthly recurring revenue) you need to keep hitting month-in-month-out to reach your ARR (annual recurring revenue) goal for the next year. Simply subtract your target ARR from your last year's ARR and divide by 78. It really is that simple.

Is a 40% EBITDA good? ›

It takes into consideration growth and profit. In terms of interpreting the rule, 40% is the baseline figure where the company is deemed healthy and in good shape. If the percentage exceeds 40%, then the company is likely in a very favorable position for long-term growth and profitability.

What is a good EBITDA for a SaaS company? ›

This number is a well-known figure in the SaaS Industry that assesses the health of your SaaS Business. The formula says that if you add together your revenue growth rate and EBITDA profit margin, and if their sum equals more than 40%, your company is healthy and doing well.

What is the most important barrier to SaaS? ›

Lack of adoption strategy. A lack of a clear adoption strategy and budget is the single biggest reason that businesses fail to make the most out of SaaS, and ultimately lose money.

What are the six pillars of security? ›

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What are 4 ways to attract customers? ›

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  • Promote your expertise. ...
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What are the six strategies to attract customers? ›

The following six strategies will help you attract and keep customers.
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What words attract customers? ›

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  4. Offer connected upsells.
  5. Create a communication schedule.
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  6. Optimize pricing.
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Advantages of SaaS Technology
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What do SaaS customers want? ›

Customers want to see more features that meet their needs appearing on a regular basis. The more they have to leave your product to use other features that should be intuitive, the more likely they are to abandon your product for one that has those features built in or integrated with another tool that does.

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Challenges in the SaaS industry
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The Seven Degrees of Freedom for Growth are: Selling existing products to existing customers.
Acquiring new customers in existing markets.
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  • Opening up new competitive arenas.

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Using these ideas, Rostow penned his classic Stages of Economic Growth in 1960, which presented five steps through which all countries must pass to become developed: 1) traditional society, 2) preconditions to take-off, 3) take-off, 4) drive to maturity and 5) age of high mass consumption.

What are the 5 phases of growth? ›

The six growth phases are described below:
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  • Phase 2: Growth Through Direction.
  • Phase 3: Growth Through Delegation.
  • Phase 4: Growth Through Coordination and Monitoring.
  • Phase 5: Growth Through Collaboration.
  • Phase 6: Growth Through Extra-Organizational Solutions.

What are the three pillars of growth? ›

Enterprises stepping into the self-serve space and launching their growth practice need to first build a strong foundation on three pillars: technical, organizational, and operational. Each of these pillars plays a specific role, and each can only drive desirable outcomes if the other two are in place.

What are the 3 important focus areas to achieve profitable growth? ›

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Which growth strategy is the easiest? ›

Market Penetration

This is the lowest risk and potentially easiest growth strategy. It involves growing the sales of your existing product in your existing market.

What is the 5 P's of strategy? ›

Each of the five P's represents a distinct approach to strategy. This includes Plan, Ploy, Pattern, Position and Perspective. These five elements enable a company to develop a more successful strategy.

What are the 7 elements of strategy? ›

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  • Step 2: Internal Analysis. ...
  • Step 3: Strategic Direction. ...
  • Step 4: Develop Goals and Objectives. ...
  • Step 5: Define Metrics, Set Timelines, and Track Progress. ...
  • Step 6: Write and Publish a Strategic Plan. ...
  • Step 7: Plan for Implementation and the Future.
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What are the 7 steps to implement a business strategy? ›

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  3. Delegate the Work. ...
  4. Execute the Plan, Monitor Progress and Performance, and Provide Continued Support. ...
  5. Take Corrective Action (Adjust or Revise, as Necessary)
Feb 25, 2020

How do SaaS companies get clients? ›

So how do you actually get the first customers for your SaaS? You can begin by contacting people from your network: friends, acquaintances, current and former co-workers, and ask them for introductions. Let them know when the product is ready and offer to help them with a demo.

How do you keep a SaaS customer happy? ›

15 SaaS Customer Retention Strategies
  1. Define clear expectations.
  2. Provide an “aha” experience.
  3. Contextualize your offering.
  4. Offer connected upsells.
  5. Create a communication schedule.
  6. Keep your product current.
  7. Go above and beyond.
  8. Consider a rewards program.
Sep 20, 2022

How do you attract first clients? ›

8 Ways to Find Your First Customers
  1. Make a list. ...
  2. Look for referrals. ...
  3. Work your network. ...
  4. Show it off. ...
  5. Attend industry events. ...
  6. Team up with other business owners. ...
  7. Build an online presence. ...
  8. Spread the word on social.
Aug 5, 2019

How can I improve my SaaS sales? ›

13 Best Ways to Increase Sales for Your SaaS Business in 2022
  1. Identify Qualified Prospects. ...
  2. Give Short and Value-Focused Demos. ...
  3. Optimize your Email Campaigns. ...
  4. Show Customer Pain Points. ...
  5. Keep your Trials Short. ...
  6. Reward your Existing Customers. ...
  7. Upsell and Cross-Sell your Existing Customers. ...
  8. Show Customer Success Stories.
Feb 15, 2022

What does rule of 40 mean? ›

The Rule of 40—the principle that a software company's combined growth rate and profit margin should exceed 40%—has gained momentum as a high-level gauge of performance for software businesses in recent years, especially in the realms of venture capital and growth equity.

What is the rule of 40 formula? ›

The rule of 40 formula requires just two inputs, growth and profit margin. To calculate this metric, you simply add your growth in percentage terms plus your profit margin. For example, if your revenue growth is 15% and your profit margin is 20%, your rule of 40 number is 35% (15 + 20) which is below the 40% target.

What is a good yoy for growth? ›

Growth rate benchmarks vary by company stage but on average, companies fall between 15% and 45% for year-over-year growth. Businesses with less than $2 million in annual revenue generally have much higher growth rates according to a Pacific Crest SaaS Survey.

Is 3% a good growth rate? ›

Good economic growth can vary, but typically falls within two to four percent. This means that even if a company is only growing five percent a year, it could still have a good growth rate compared to other businesses.

Is a 15% growth rate good? ›

In general, however, a healthy growth rate should be sustainable for the company. In most cases, an ideal growth rate will be around 15 and 25% annually.


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