outsourced product development (OPD)

SaaS – Business & Revenue Model Considerations

Based on over decade of our experience in product engineering services, we have learned some very interesting facets of building product, taking it to the market and generating revenue. Having seen successes and failures with different revenue and business models of product engineering companies (ISV’s), I would like to highlight key learning’s around business, service delivery and revenue model

Product companies, including license software companies, recognize revenues immediately upon sale and delivery of the product. SaaS/cloud companies sign customers up front but recognize revenue over time as the service is delivered
For a product company, a […]

Laws for Successful SaaS Businesses

Interesting post from Byron Deeter on Sandhill where they studied more than hundred SaaS companies and came up with following laws for building highly successful SaaS businesses.

Key business metrics for SaaS companies should be CMRR (Contracted Monthly Recurring Revenue) and Cash and not bookings
It takes at least $300K of CMRR to climb the Sales Learning Curve – Stop at three sales reps until at least two of them are making $100K MRR quotas.
As soon as you have climbed the Sales Learning Curve, begin ramping your sales force by hiring renewal-oriented account managers.
Channels are very […]