So, what stages of development do we see on the trajectory?

1. First, there is a stage of rapid growth of interest under the influence of inflated and unreasonable expectations. Let’s call this stage “stage 1”. At this stage, people are buying solutions like pies, guided by fashion and the herd instinct lying somewhere next to it.

2. Then comes the sobering-up stage (“stage 2”). This is when people en masse begin to realize that they have not quite correctly associated their needs and the possibilities of solutions. At this point, people stop using the solution or don’t buy it if they didn’t have to make a purchase to try it.

3. Then comes the stage of searching for real customers and finishing up the right functionality for them (“stage 3”). Many may not live to this stage, simply having lost faith in their own product or in their consumer.

4. After that comes the most delicious stage – when the consumer willingly buys a convenient product, because. it meets his expectations and does not cause problems during operation (“stage 4”).

5. Then comes the last – the terminal stage (not shown in the figure), when the owner of the solution must either throw it away or transfer it to other economic or technological principles (“stage 5”).

Debriefing (demand) at each stage.

Now let’s break down the volume of demand at each stage, piece by piece.

How big is the demand in stage 1?

To answer this question, you need to find the reason for the demand by answering another question – who is the target audience at this stage? Obviously, in stage 1, technological pioneers and geeks are in demand – they are chasing fashionable novelties and are ready to experience them for themselves, not paying attention to the consequences. Are there many such pioneers and geeks? Statistically, not so much. According to a study of demand in the SaaS / B2B segment, which we conducted in April last year, there are no more than 5-7% of such companies from the general population. What does it mean? This means that your volume of demand, above which there is no way to jump over, is only 5-7% of the entire population of the target audience. And only if you are ready to have such a volume of sales and fight further – continue in the same spirit.

 From insiders – one of the SaaS developers has a client base of 700K registrations, for example. This is what I mean by the beautiful, a) that there is a demand, and b) SaaS is clearly one of the favorites of the SMB segment.

according to our data, which we cited in the study, there are at least 2M SMB clients on the European. If your friend, whom you do not want to advertise, has 700K test registrations, this only indicates that his target audience has matured to stage 4. That is. your example confirms my arguments. Understand?

We go further. How big is the demand in the second stage?

Stage 2 is sobering. On the one hand, not all technological pioneers and geeks have left – many have remained. But on the other hand, the bulk of customers are skeptics, not yet mature enough to pay for a solution that is not quite suitable for their needs. Therefore, the real demand at this stage can grow, but not by several times and requires very fine and meticulous work to create new functionality, set up the sales department and technical support service. For example, Megaplan began to get close to the exit from this stage, having entered it a year and a half or two years ago. In order to keep the financial performance above zero, a year ago, the marketing department was completely reduced there and the sales department was reconfigured, because. it became clear that the necessary minimum of operational marketing activities works well and is already quite automated, while other activities have practically no effect on the flow of leads. Why pay people who do not bring new customers? Nothing personal – just SaaS.

Further. How big is the demand in the third stage?

If the company found the strength and retained faith in its decision, and also gained a new understanding of the needs of its client and, in addition, the investor did not run out of money and patience to bear losses for several years, plus a lot was done to improve the product – in In this case, the company will certainly have a bright future if the management does not get star fever and go crazy. The third stage is the best period for the company – the period of business scaling. At this point, skeptics turn to face the solution and start experimenting with it. At first, the most daring, and then the rest of the skeptics, start buying. Demand starts exponential growth. The main task of management is the correct scaling of the business. It is not simple. At this stage, excellent managerial qualities are needed for business leaders. Not all startups have them. It’s time to think about how to attract and motivate a person with the necessary business skills for long-term work, if your company does not have one.

We go further. How big is the demand in the fourth stage?

This is the stage of stability. At this stage, management is interested not so much in demand as in finding alternative solutions in order to replace in time what brings the main income today. The main task of the management at this stage is to keep operating costs low and to find real alternatives to existing products – the sources of the main revenue.

Now about the last, terminal stage. It is characterized by the fact that if the management has not found an alternative to the dying solution that generated the main revenue, the company goes under the ice along with a drop in demand for its services.

Indeed, “love lives for three years” and in the SaaS / B2B segment, 2 companies won – Megaplan and MoySklad – and neither the first nor the second were pioneers in business area automation, but they proposed the SaaS principle itself. That is, it seems to me that your drawing reflected underdone popcorn, the one that is at the bottom of the bucket, and all the most fried and with a hypnotic smell – this is SaaS in the story with these two mentions.