Last week our team, like lots of other members of the SaaS community, attended the OpSource/SIIA SaaS Summit 2010 – titled, “All About the Cloud.”  We had a busy and meeting-filled week, as I’m sure many did.

Because SIIA and OpSource gave this conference jointly – it was somewhat different than the OpSource led conferences we have attended in the past. Instead of being an industry conference tilted towards a single vendor’s customer base and prospects, it was much broader, bringing in a wide array of SaaS vendors and industry providers.  Since OpSource has been an industry leader for some time, I wouldn’t attribute the change entirely to the influence of SIIA. More likely it was the combination of the two constituencies along with a bit of a push from the uptick in the economy. Whatever it was, it was one of the biggest groups I’ve seen for SaaS/Cloud conferences in a few years.

It was perhaps most surprising to see the “maturity” of the industry in our guests. Most of the vendors were not from start-ups or ISVs moving to SaaS – instead they were established SaaS vendors – regardless of the lifecycle stage of their product offerings.  This shifted the conversations we had at our booth from “what does it take to build a SaaS product?” to “how do I scale my architecture?” or “how can I extend my offering to bring new services to my customers?”

This is a good thing to see, but I wish the presentations had been more geared to the audience and less to information about vendor’s products, but it could be said equally that no one knew for sure how the attendance would balance out long enough in advance to plan for it. I think that will even out next year, now that there is some history in the combined event.

Jim Geisman and I gave a workshop following the summit that was quite successful as we “filled the house” with as many guests as we could comfortably engage with. It was a wide-ranging group with representatives from some of the largest software vendors in the market to some new entrants from Latin America.  If there was a common theme among them it was the need to understand the options and structure of product development and pricing for SaaS. The folks from DreamSimplicy were good enough to feature a video of our workshop on their website.

There is certainly a void when it comes to clear information that isn’t filtered by a supplier’s agenda. We all do it – but there are also some who push their value above everything else. And, unfortunately, there are several instant pundits in the industry who really have less background than opinions.  From that point of view, I am proud to be associated with someone like Jim Geisman for this workshop because his background shows in the depth he can bring to the subject of pricing.  To say you can’t “afford to get your pricing wrong” may be a bit of an overstatement – companies change their pricing and survive – but it can certainly be as much of a market killer as developing a product that misses the mark.

In no particular order then – some notes and learnings from the Summit:

• Pick your strategy, play through, check your metrics, adjust and play again. I saw several companies who were trying multiple strategies for product, pricing, marketing, etc – simultaneously.  The result is – every attempt is a one-off with no way to measure one against the other logically or if the strategy might or might work if tried more than once.  The people trying to execute on all these ideas are playing a difficult game. Which idea really has legs? Which one do we really want to go with? And by the way – what do their customers think of this apparent lack of single purpose?  It’s difficult to navigate no matter where you stand.
• Look for your weak spots, eliminate them or optimize as well as possible. I heard many stories of early decisions that will eventually put a SaaS company in a no win situation.  Your infrastructure maintenance costs are eating into your cash flow at an ever increasing rate as you grow. Or – perhaps you want to change your pricing or offer a discount and it seems like the only way to do it is take payments manually and adjust the books, unless you want to redevelop your pricing and billing system…. It is easy to say you might have seen these things coming, but that’s Monday morning quarterback speak.  It sounds too simple, but there is help in the Theory of Constraints: First, optimize the situation as well as possible, looking for ways to manage the issue at best you can. Don’t stop there, leverage the stop gap only as long as needed to develop a true solution to the problem.  If you’re losing opportunities or burning cash in SaaS, you’re killing yourself, slowly but certainly.
• If you have an opportunity to speak to your peers and prospects, give them value. This sounds a little simplistic, but it’s worth a thought.  We need to take every opportunity we can to expose our products to new customers, especially in this tight economy, but you can’t spend the time you’ve been given with a blatant sales pitch.  The audience paid to sit in front of you.  What can you give them for their attention? Knowledge. What do you know? What have you seen? What experience do you have you can share? If that is the sum total of your talk, it will be remembered. If it is embedded in your new product announcement, it is more likely people will hear it.  To many of the presentations at conferences today are symptoms of our economy.  Our audience is looking for positive news and knowledge, just like we are.
• SaaS is a business model – not a technology. I still see far to many attempts to sell SaaS as a technology and the same is true when we switch to using “cloud” as a substitute term.  There are technical advances that are becoming available because of the growing SaaS/Cloud market, but they are just enhancements of what otherwise is a service-led, cash flow based, business model.  Companies in the field need to be successful at reaching an adequate size market with a positive cash flow and technology can only assist in achieving that goal.  Understanding the business of online services and planning to scale effectively is critical to success.

I hope to get more chances this year to get out and be in the field and at conferences to hear and share more ideas and experience.  It is a great opportunity to learn more about what is happening “inside” the business of SaaS.