As the growth of Software as a service (SaaS) continues to shake and topple many other traditional businesses, it is now the most popular way most companies prefer to deploy their products and services.
The cloud-based computing business model continues to grow in adoption and usage. It now every nook and cranny of the business world and had been the fastest and largest market segment globally since 2019.
For an Enterprise exploration of the industry, here we look at what Software as service companies, the types of SaaS companies, what they do, and finally at the top companies exploring the SaaS business model. Let’s dive in!
What Are SaaS Companies?
Software as a service is a business model where organizations or businesses offer users or clients the use of cloud-based software applications which are centrally hosted. These companies that provide this cloud-based software and applications are called SaaS companies.
They offer users and clients who might be individuals or other companies many advantages that include lower cost as they do not have to buy and install IT infrastructure, make it possible for startups to get access to high-quality software and applications on a subscription basis which is lower cost and budget-friendly, give them access to many features and functionalities, among others.
What’s more? SaaS companies develop, host, maintain and update the cloud-based. These remove the time-consuming maintenance process, making an update of the product prevalent in the traditional software model delivery. As these SaaS companies’ products are cloud-based, they have no borders and can access the global market and all niches restricted. This delivery across international borders is made without increasing the delivery cost. This easy delivery has been one of the many reasons why the SaaS space and companies in it are booming and will continue to do so in the future.
Recent trends, predictions and statistics show the prospect for the SaaS business model and why as well as how SaaS companies are changing the business world;
From 2020, It has become essential that SaaS build customer-success functions and take grand steps towards customer success management.
- Many of the top SaaS companies in 2020 had realized that the product of the main driver of growth in the industry. Many data from SaaS lead generation campaigns done in these top companies support the power of SaaS products. Hence, product-led growth and exploitation of the data can be a powerful tool.
- Customer spending has been noticed to have more growth over time than others over the number of unique SaaS apps purchased. Therefore, this higher percentage growth means that the existing SaaS vendors, SaaS companies are focusing on specific niches very fast using product differentiation.
- There is an ongoing gradual shift from the use of options provided by client/server architecture to the hybrid cloud where there is an integration of the private and public cloud.
- Several reports show that SaaS companies are churning more data every year. Globally this is increasing the number of features that are being offered through expansions and acquisitions.
- AI technology has made awesome contributions to cloud security. This contribution has helped boost the growth of SaaS companies as people feel using SaaS apps is becoming more secure. Threats and internet malicious content can be identified and captured before harming their SaaS companies’ infrastructure.
- The boom and proliferation of SaaS companies come with a need for easy and effective data migration and integration. This integration can be done using APIs and therefore has prompted the use of APIs among SaaS companies.
- Since SaaS companies are the opposite of the traditional on-premise, they are built on three steps: cloud computing inclined; setup, growth, and stabilization.
- Setting up your SaaS company means that you will have to use a well-tailored approach to provide excellent integrations with customers’ systems. Building a SaaS company entails a lower implementation cost and a strong focus on the product.
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Some Important SaaS Stats for 2021 and Beyond
The SaaS Business Model: How to Join In
As mentioned before, building a SaaS business involves three stages; setup, growth and stabilization. Let’s take a look at these steps and how you can move into the SaaS space with them.
The Setup
This stage is where the foundation of the SaaS company is built. The founders discovered the pain point of their future clients, the gap among the needs in the SaaS industry, etc. They develop the SaaS product, plan the lead generation campaigns to use and push the product info the market, and identify their specific market.
This stage is all about setting up the plans for all the activities and processes to make the SaaS company have a stronger foundation. You must know that creating an effective sales and marketing strategy is important at this stage; you must also think about managing the company’s finances and customer support.
Growth
Following the launching of the SaaS product into the market, the company will experience some growth if the product is met with great quality acceptance in the niche it serves.
However, because of SaaS companies’ flexibility to expand their target market fast, you will have new customers who will adopt your software or application. This expansion will create a sudden demand, and you will have to respond quickly to the market to meet this demand. It will lead and entails high activity by your sales, marketing and customer support teams to help capture this demand and maintain a high customer base.
In the same line with the increased demand, there will an accompanying increase in revenue. To up your SaaS game, you must reinvest this back into your SaaS products and services, such as increasing customer support and IT support.
Stabilization
Stabilization is when your company’s growth begins to stabilize. However, you will get new customers by using added benefits. SaaS companies, at this point, do not take on more overhead costs because if they had reinvested well into marketing, customer support and products updates.
If you had down the correct reinvestment as suggested during the growth phase, these tools would help you keep pace with your customers’ demands and give them a great user experience. They will also help you pursue an eventual exit strategy.
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Types of SaaS Products
Rather than being hosted in-house like the on-premise traditional software delivery, SaaS products are hosted in the cloud. Therefore, users can simply get access to the software using an internet browser.
Some examples of on-premises software applications that are now cloud-based SaaS software include; QuickBooks, Microsoft Office, AOL, etc. However, now you can download them on any device that can surf the internet or use a browser to access them.
SaaS companies are usually categorized into B2C or B2B SaaS companies. This grouping also relates to the type of SaaS product which they sell.
- B2C SaaS companies focus on providing solutions for individuals’ personal use. Thye usually goes in the areas of personal finance and entertainment. Examples of B2C SaaS companies are Bumble, LinkedIn, Netflix and Experian.
- B2B SaaS companies, on the other hand, focus more on customers who are usually others companies, management teams, business owners, and even organizations. Examples of B2B companies are Google, Hubspot and Asana.
Simply put, B2B SaaS companies refer to those SaaS companies that sell software applications to other businesses as a service. These SaaS software applications help these Cliets businesses up their game and automate most of their things.
Hence, many businesses have come to rely on the services of B2B SaaS companies and their services to optimize their operations, sales, marketing and customer support efforts.
Some of the top SaaS companies in the B2C and B2B categories that could give you a perspective of how the cloud-computing market segment is growing will include the following;
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SaaS IT & Security Companies
Parallels
Founded in 1999, with it headquarter in Bellevue, Washington, United States, Parallel is a SaaS B2C private company that offers cross-platform virtualization software solutions to Apple’s Mac OS.
The company has remained at the top of the SaaS space for the last 20 years; in fact, it recorded a whopping $100 million revenue within the first nine years of its operation.
KnowBe4
KnowBe4 was founded in 2010 and had its headquarters in Clearwater, Florida. Since, 2010 it has remained one of the top companies in the SaaS space as one of the largest security awareness, training and acquisition companies.
KnowBe4 is a B2B, and its products are aimed at handling the IT problems of companies globally.
Fleetsmith
Fleetsmith is a B2C and B2B apple fleet Management private company founded in 2016 with its headquarters in San Francisco, CA.
Fleetsmith, while focusing on Apple devices, offers intelligence, paying, device setup, and security solutions as a SaaS management platform. The founding team aimed to solve device management problems for clients.
LogMeIn
LogMeIn is a public company that was founded in 2003 with its headquarters in Boston, Massachusetts.
It is a SaaS company that offers cloud-based remote connectivity solutions. It recorded a whopping revenue of $1.2billion in 2017. As a B2C and B2B company, its services support millions of users globally.
Atlassian
With its headquarters in Sydney, this public company was founded in 2002.
Over the years, Atlassian has acquired millions in revenue, and the beautiful thing is that they have done this without using an Enterprise sales team. It achieved this with team collaboration, user-friendly software, and some good project management tools like Confluence and JIRA.
Solarwinds
Also founded in 1999, but with its headquarters at Austin, Texas, U.S. Solarwinds is a public company and a leading SaaS company that offers cheap and powerful its infrastructure.
As a B2B SaaS company, it has more than 300,000 customers in 29 countries. It enables this client to monitor their cloud-based IT infrastructure.
Zendesk
Zendesk was founded in 2007, with its headquarters in San Francisco, California, United States. The SaaS company is publicly traded, and it is also involved in B2B and B2C SaaS products.
When it started, Zendesk employed people from its home country Denmark, instead of hiring staff from Silicon Valley. This tactic helped them develop multiple creative SaaS products for managers, agents, developers, and individual users.
Intercom
Intercom has been achieving some of the top success rates in the SaaS space. It was reported to have generated a $50 million annual recurring revenue in 2019, a rare feat in the SaaS space.
The top record-breaking revenue achiever was founded in 2011 and had its headquarters in San Francisco, California. It has been recorded that Intercom uses a combination of powerful lead generation strategies like CTAs, SEO growth strategies and dynamic keyword insertions to achieve this feat.
HelpScout
With its headquarters in Boston, Massachusetts, HelpScout was founded in 2011 as a private company. It is a SaaS B2B company that offers an email-based customer service management platform that includes an embedded search tool for CRM experts as well as a knowledge base tool
Front
The front is another SaaS private company that offers B2B SaaS products to companies and businesses. Its products help firms and organizations turn their emails into actions, help desk analytics and make their workflows more productive.
Front started in 2013 but now has over 5000 companies as clients. Its headquarters is in San Fransisco, California.
Acquire
As Another top-performing SaaS with its headquarters in San Francisco, California, Acquire was founded in 2018. Since its inception to date, Acquire has become a major customer support management SaaS platform.
In line with its objective of providing a top modern-day digital experience for its customers, Acquire has established a reputation for bringing the best customer relations platform in the SaaS space.
Its history of developing high-end SaaS Products comes from the behavior of the CEOs giving a free hand to its engineers. This open-ended company culture had led to the development and delivery of good customer service over the years.
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SaaS Human Resources Companies
Top SaaS platform for professionals – LinkedIn was established in 2002. It headquarters is in Sunnyvale, California, the U.S. Over the years, it has become the main website for job postings, business handling, recruitment and content sharing.
However, hope it started as a recruitment platform; LinkedIn is now also a popular place for B2B marketers who use it as a leading generation and content marketing platform.
BambooHR
Small businesses have always had a problem finding the right solutions to payroll, ERP, etc. BambooHR solves this problem by offering such optimized services for small businesses.
It was founded in 2008, with its headquarters in London, Utah. Its inclusive offers are rapid implementation, free trials, customizable solutions that small businesses fund easy to use.
Lever
The Lever is a SaaS company in the business of recruitment. It was founded in 2012 after raising a $2.8 million seed fund.
It offers many top companies in the world application tracking system, recruitment software, and application tracking tools to up the game for their human resources department.
Freshservice
Freshservice is a SaaS company that is part of the network of businesses owned by Freshworks. It offers help desk SaaS software applications that help customer support teams with their daily duty. Over the last 24 months, it has experienced about 78% growth.
Workday
Workday is a B2B SaaS company that offers human resources teams tools for human capital and financial management. It is one of the top human resources SaaS services used globally. Workday’s market capitalization is well above $54.85 billion.
Upwork
Based in Santa Clara, California, United States, and established in 2015, Upwork has become one of the few best freelancing platforms. It has over 5 million registered client uses and about 12 million registered freelancers.
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SaaS Product-Based Companies
Typeform
Founded in 2012 with the headquarters in Barcelona, Spain, Typeform is a B2B company that offers simple and powerful exceptional forms to businesses and makes its brand interactions efficient.
Adobe Creative Cloud
Adobe Creative Cloud is a pioneer company among the many SaaS companies dealing with product-based offerings. It was founded in 2011 and had its headquarters in San Jose, California, United States.
Being a public company, Adobe has more than twenty mobile and desktop apps that facilitate its customers’ works in video making, video editing, web development, graphic design, and photography. It is also one of the most famous cloud-based tools and has over 15 million users.
Sketch
For the European Union, Sketch offers businesses and individual users the ability to design a landscape easily. It was founded in 2010 and has been known to update itself to fit the latest technology environment effectively.
SAP
SAP is a German software solutions company founded in 1972. It had grown over the years to have two revenue streams and the software and cloud revenue stream.
Userpilot
This B2B SaaS software company offers product experience software that arms products teams with the right weapons to improve their efforts. Such ‘weapons’ will help improve 5he feature engagement, user activation and increase the overall product adoption.
They will allow users to create in-app experiences that will result in greater user adoption and retention.
Userpilot is a good way to lower your churn without hassle on the marketing or development team.
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SaaS Engineering Companies
BrowserStack
With its headquarters in Mumbai, India, BrowserStack was founded in 2011. It is a cloud-based mobile and web testing platform for developers globally. What’s more? BrowserStack makes for easy testing and seamless integration with the existing setup with fast and direct results.
Circle CI
Founded in 2011, Circle CI has its headquarters in San Francisco, California, United States. It furnishes software companies with continuous delivery and integration. Circle CI rubs more than 35 million builds every month
Pingdom
In 2007, Pingdom was founded to provide high-performance website performance that affects conversions, search rankings, page views, revenue, and bounce rates. Over the years, Pingdom had acquired Facebook, Spotify and Pinterest.
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SaaS Dev-Ops Companies
PagerDuty
This SaaS platform helps capture data and insights, interpret them, engage with the concerned people, and develop concise results. It offers over 350 integrations to streamline the processing of organizational operations.
Sentry
Sentry offers developers ye ability to dictate and solve software errors. Its services include provisioned servers, cross-functional visible, and performance monitoring. Simply put, Sentry offers developers protection against code bugs
Namecheap
Namecheap is a popular domain name registrar with its headquarters in Los Angeles, California, United States. Founded in 2011, it offers clients domain names at a cheaper price. What’s more? Clients can sell domains they bought through Namecheap to others.
WP engine
Founded in 2010 with its headquarters at Austin, Texas, United States, WP Engine has become the top leading WordPress digital SaaS platform. In recent years, it has earned annual recurring revenue of more than $132 million.
Datadog
Datadog is B2B and B2C SaaS company founded in 2010 with its headquarters in New York City, United States. It offers monitoring services and stellar analytics for cloud-based projects. It becomes a public company with one of the most successful IPOs in 2019.
Wix
Wix is a B2C and B2B cloud-based website creation tool that makes it easy for users with little or no programming and web development experience to create simple websites. Its market capitalization is well above $13.1 billion.
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SaaS Business Ops Companies
Google G Suite
Founded in 2006, Google G Suite has its headquarters at Mountain View, CA, and over the years, it has become one of the most powerful SaaS collaboration tools for businesses.
Slack
Slack is one of the top SaaS platforms that has witnessed one of the greatest growths. It was founded in 2009, and since then, it now has more than 2000 apps in its directory.
Cisco
Established in 1984, Cisco had evolved into one of the top SaaS companies and a global leader in IT.
Zoom
The Salad video-conferencing company was founded in 2011 but had a boom following the coronavirus pandemic of 2020 as meetings and conferencing went online. It is expected to have a market cap of about $43.1 billion by 2022
Microsoft Office 365
Office 365 is another awesome SaaS software by Microsoft. It was founded in 2006, but it now caters to over 200 million users every month.
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SaaS Finance & Accounting Companies
PayPal
Founded in 1999, PayPal now operates in more than 200 countries. However, it was bought by eBay in 2003 but later had a split in 2004.
Bill.com
Bill is a SaaS financial automation platform founded in 2006. It has its headquarters in Palo Alto, California, United States. Its main service is to provide payment and invoicing assistance to small and medium-sized businesses.
Avalara
Delloite had racked Avalara as one of the leading tax compliance and accounting DaaS software. It makes tax accounting, reporting for every business hassle-free. It is a public B2B and B2C company and was established in 2004.
Intuit
Established in 1983, Intuit spends most of its time analyzing customers’ pain points and addressing them. The SaaS company focuses on developing software that will make most business management processes hassle-free. It is a traded B2B and B2C SaaS company.
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SaaS Marketing Companies
Mailchimp
This 20-year-old email empire welcomes thousands of new customers signing up daily. While it emerged from a trash web business, it started to see great growth and meet new success heights when charging people.
Semrush
Semrush was established in 2008 with its headquarters in Boston, the U.S. Over the years, it has become a leading SaaS research platform for online marketing.
Canva
Canva was founded in 2002, and its headquarters is in Sydney, Australia. It aims to reduce the complications involved in the use of graphic design tools. It had acquired over 20 million users in the last eight years as people seem hassle-free graphic designing.
Canva’s drag and drop feature allows anyone and even novices in graphic designing are to be able to do some graphic designing ad this is the reason it is loved by many. It is currently valued at more than $6 million.
Act-on
Founded in 2008, Act-on shows how a complex marketing system can magically become the top SaaS marketing software for small and medium-sized businesses.
Envoy
Envoy is a B2B SaaS company that makes workplace activities easier with its software that enables reservations, easy booking management, and visitor management. It saw about 80% year-on-year growth in 2020.
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SaaS Sales Companies
Salesforce
Salesforce was founded in 1999, but it has become the most successful SaaS company in the world over the years. It provides cloud-based CRM applications as well as sales applications. Being a B2B Salad company, Salesforce has been benefiting from over 150,000 companies since its establishment.
Hubspot
This SaaS company is a pioneer in content management, CRM, web analytics, social media marketing, and SEO tools. This range of services has contributed to it becoming one of the top SaaS companies in the world.
Pipedrive
Pipedrive got international customers from all over the world in the first five years of its establishment. These customers are spread out in more than 100 countries. It offered a SaaS incubator platform that serves these customers.
Outreach
While working to solve the sales problem with GroupTalent, the founders built this SaaS platform to increase the productivity of sales representatives. From this, Outreach was founded in 2011 with its headquarters in Seattle, Washington.
Yesware
Using the easiness of installation and simple integration to leverage the great value of their brand, this SaaS company won the most implementable SaaS from G2 Crowd.
Yesware was founded in 2010 but is now one of the top sales interaction platforms use by up to a million users.
Xero
Xero is a SaaS company that offers small and medium-size businesses financial and accounting solutions. It had more than two million users and both the B2B and B2C categories of SaaS companies.
Shopify
Shopify is an eCommerce platform that Shopify is an e-commerce company that offers user shopping platform as a service it services in
cludes others on the SaaS structure. Such services include payments, customers engagement, marketing and shipping.
DropBox
Established in 2007, DropBox is a SaaS startup that offers file storage in the clouds and client software, file synchronization, and personal cloud. It operates on all devices that can connect to the internet. While it has a freemium model, uses can get more space on purchase.
DocuSign
DocuSign was founded in 2003 and had its headquarters in San Francisco. Over the years, it had acquired users across 180 countries. It offers users the abil6 to sign on digital documents using electronic devices. The signatures signed with it are in line with US ESIGN, EU qualified signatures and EU regulations.
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SaaS Research Companies
Splunk
Splunk is a simple SaaS software solution used for monitoring, searching for and interpreting machine-generated big data. It is both in the B2B and B2C categories of SaaS companies. In 2020, Splunk’s year-over-year growth was over 100%.
SurveyMonkey
SurveyMonkey is a popular B2B and B2C SaaS data gathering service. It offers online survey developer tools that are helpful in data representation and data analysis. Survey Monkey had been recognized as the Winter Momentum Leader for 2021.
Elastic NV
Elastic NV is B2B and B2C SaaS data analytics platform that allows users to manipulate data differently. Users can penetrate their data using a search feature. Its market capitalization is over $13 billion.
Pluralsight
Pluralsight is a cloud-based education platform that analyzes career skills and matches courses using technology based on their assessment scores. It offers both B2C and B2B products to customers. Pluralsight market capitalization is above $3 billion.