8 SaaS Myths Founders Should NEVER Fall For 🙅

it feels like startup myths are everywhere especially in this age of social media whether someone's trying to sell you something and they're telling you that starting a company is easy starting your own business is a slam dunk these myths are pervasive and they can be dangerous to entrepreneurs so that's why in this video I'm going to cover eight myths that SAS Founders and really all startup Founders should never fall for before we dive into our first myth I'd like to give a shout out to our banking partner Mercury for sponsoring today's video I'll tell you more about them in just a couple minutes let's dive into the first myth it's that all the good ideas are taken usually this happens when you as an aspiring startup founder have an idea you think the idea is brilliant and then you Google it or you go to chat GPT and you find out that there's already five other incumbents doing the same thing what I want to say is that you can have competition and still succeed now it depends on how large of a business you want to build and how big the niche is in tiny tiny little niche plays yeah having one or two competitors can be too much if you're trying to get to fifty thousand dollars a month and the entire Market is only a hundred thousand a month that makes it tough but in most cases if you want to build a million dollar or more SAS company you can have a lot of competition and still be just fine this is coupled with that thought inside of us that in order to succeed I have to build something completely different than anything else on the market and if we looked through my hundred and twenty something Investments including all the Tiny Seed portfolio companies which you can view at tinyc.com portfolio almost all of them had competition before they entered the market just three examples of that are sign well which is electronic signature the founder is doing amazing you've seen him on this channel before and the company is growing but they are facing huge incumbents like hello sign DocuSign and all the other electronic signature apps another is gym desk a company that's growing quickly but certainly there was software to run your gym in Fitness Studio before they launched but they are doing quite well well as well as castos which is podcast hosting and of course there's been podcast hosts for 10 or 15 years but castos came on the scene with their own unique Spin and they've done well so don't believe this myth that all the good ideas are taken myth number two is that you're gonna build something that people want on your first try the odds are the first startup you launch is going to fail in fact the odds are that when you launch a product you are going to have to Pivot and pivot and build and take customer feedback you're not gonna get it right the first time so even if you are successful with your first idea it's very very unlikely that it will be the vision and the idea that you had from the start I talked recently on this channel about my story growing and selling drip and the initial idea for drip was a very simple email capture widget and it went on to become a full-blown email service provider then a marketing automation provider it really morphed and changed over time even though my vision was something pretty specific in the early days I listened to customer feedback I filtered that through my vision of where I wanted the product to go though and ultimately that allowed me to compete in a very competitive space and to grow to a multi-million dollar company before having an exit back in 2016. myth number three is if you can't code you can't be a SAS founder and that is patently not true I see all around me folks who go find a technical co-founder and partner up and that can be a great matching of skills if one is either marketing or sales or the subject matter expert in a niche and the other one is the software developer who's building the product another alternative you have is to use no code we talked quite a bit about that on this channel but whether you use no code to build your final product or just to build your MVP there are ways around needing to know how to code in addition there's the option of saving up enough money to hire your co-founder in essence this is a phrase that I've heard in the startup space where if you have enough money in the bank you can hire a developer to build it now there's a lot of risk there I will admit and there are some bumpy roads that can happen if you don't have a technical co-founder but whether you save enough money or you do raise funding you do not need to be a developer in order to launch even a Technical startup myth number four is one that all of us as product makers fall for that building the product is the hard part building the product is the easy part there's almost never technology risk or product risk in what we are going to build as bootstrapped and mostly bootstrap Founders finding customers building something people want actually getting people to use it and pay for it these are the hard things we have this myth in our head that my idea is so good it will Market itself it will sell itself everyone will clamor to sign up all I need to do is get it in front of ten thousand fifty thousand people on Hacker News on TechCrunch or insert any Tech news site here that is pretty much never the case I don't know that I can think of a single example where that has been the case where I see someone build a multi-million dollar startup purely based on the product selling itself even in those cases where we hear about really fast growth like slack and superhuman maybe even base camp if you dig under the covers and find out what actually went on people in those companies were selling they were marketing or they were early to a space and in fact there were they were filling a void in a way that you're probably not going to be able to so don't believe myth number four that building the product is the hard part myth number five is that you need to raise money in order to launch a SAS company you may have heard that less than one percent of companies raise Venture Capital I've always said Dustin one percent of company should raise venture capital and the rest should bootstrap but recently over the past few years I've updated my thinking and I now have a rule called the 99 and one rule and it says ninety percent of companies tech companies or otherwise should probably bootstrap nine percent give or take should probably raise some kind of funding to get there faster and then maybe that's through an accelerator like tinyseed maybe it's Angel investment or maybe it's friends and family and then about one percent maybe less should raise Venture Capital so if you keep that framing in mind there are a lot of reasons for this like when to raise funding and why to do it and why not to the bottom line is most businesses shouldn't raise venture capital and shouldn't raise any kind of funding because because they can and should be bootstrapped if you're going to grow a great little lifestyle business to 10K a month 20K a month to support your lifestyle and travel the world don't take investment because investors want a return and you need to grow that company in order for them to get their return I've never been anti-investment or anti-venture Capital I've only been anti people thinking that the only way to build a startup is by raising money don't believe the hype I want to pause here and tell you about today's sponsor Mercury at Mercury you can get business checking and savings accounts virtual and physical credit and debit cards with custom limits payment Integrations and more you'll be happy to know they'll automatically protect your startup's cash reserves with up to five million dollars in FDIC insurance through their partner Banks and sweep networks in fact when my companies tinyseed and microconf found ourselves looking for new banking after svb imploded last month we moved to Mercury one thing we like about Mercury is how simple it was to get a new account set up check them out at the link below and we'll also link them up in the description option myth number six is that you need to read just one more blog post listen to one more podcast watch one more YouTube video learn one more thing before you get started and the bottom line is at a certain point you have to start taking action it's too easy to get caught up in the learning phase and the best learning comes from doing and taking that risk every time you launch something into the world you will be terrified and every time you will learn something and while I obviously appreciate you here learning from this YouTube channel and maybe from my podcast startups for the rest of us as well realize that you have to balance that with doing I consume a lot of podcasts and I consume a lot of YouTube and it's in the spirit of learning to grow my business faster and just learning about the world in general but I balance that by shipping a new book by growing a company and you have to balance that as well myth number seven and this one is specifically for SAS is that you should build an audience first and ask them what they want if you're going to build an info product if you're going to build a community if you're gonna write books and sell courses then you should build an audience and ask them what they want build something for them if you're going to build a SAS product and you don't already have an audience there are so many better things that you could be spending your time on than going on Twitter and building or following I cannot count the number of people who go and try to build that Twitter following up to 5000 and they think that that's going to make their SAS successful and it just doesn't I'm not sure I know of anyone who has actually built an audience and done a good job selling SAS to it again one-time download products WordPress plugins info products but to make SAS work it's got to be one in a thousand build your network not your audience if you're going to build SAS build your network in the space that you're going to operate in build your network in terms of people who can support you people who will be in your Mastermind group people who have been there and done what you want to do but spending this time to curate an audience and then trying to sell them SAS is a Fool's errand in fact less than five percent of my more than 125 Investments have built an audience before they launched I like to think I pick companies that are going to be successful people that are probably already a little bit successful when I back them and so I found it really interesting how few of them actually had an audience I didn't have much of an audience when I launched my SAS companies and in fact I encountered what was the curse of the audience when I built drip I started asking people hey I'm thinking about building this thing and they're like yeah they wanted to make me happy they wanted to say that's a great idea so then I went and built it and some of them signed up and I quickly burned through the audience in terms of people coming and saying yeah I don't really need this and so I had received some false signals and no one was being negligent or or mean or intentionally misleading but they were trying to encourage me and so we had spent a bunch of time building and then people came in when it was an MVP and I didn't have product Market fit yet and so I kind of burned through my audience and when I came back to them and said oh I've built more they were kind of like yeah I already gave that a try it's not for me so be really careful when you hear on the internet that you should build an audience and ask them what they need inevitably you're going to want to ask are you talking about info products are you talking about building a sustainable SAS company and myth number eight is believing that building a successful company is 100 hard work or it's 100 luck or it's 100 skill it's actually a combination of the three and the two that you can control are hard work and skill some people get lucky some people get there early some people stumble upon a great idea where there's a huge void in the market most of us do not most of us have to spend years building up our skills and then hours and hours grinding away and working hard to build an incredible business so don't believe it when someone says it's all hard work or it's all skill or it's all luck because inevitably it's actually a combination those three if you like today's video and you want to see a video that continues this thought process and talks about the number one reason that startups fail and the ways to avoid making that mistake just check out this video here to my left thanks so much for joining me this week I'll see you in the next video

Channel: MicroConf

Views: 14,047

Keywords: MicroConf, Saas, startups, startups 101, software developer, saas developer, saas business, saas startup, app developer, saas founder, building saas, building an app., developing an app, saas product, software as a service, saas sales, tech startups, saas mistakes, saas mistakes to avoid, saas myths, rookie mistakes, founder mistakes, co founder mistakes

Id: zAGw6Ql7bSs

Length: 10min 48sec (648 seconds)

Published: Sun Apr 23 2023