Our workshop with Software Pricing Partners following the SaaS Summit: All About the Cloud is now finalized! Seating is limited so please check the details below and sign up NOW:

SaaS Offerings: How to Develop, Price, Operate, and Succeed

• One Day SaaS Executive Workshop Covering Technical and Business Topics
• May 13, 2010 at the Donatello Hotel (near Union Square) San Francisco

Executives responsible for succeeding in the SaaS market need to make a series of critical choices in developing, packaging and selling their offerings. This one-day workshop provides the insights and tools needed to make the right choices.

Many of the challenges SaaS companies face can be met by balancing and integrating technical considerations with the business aspects of SaaS. Companies that can do this can bring their products to market rapidly and become cash-flow positive quickly.

This workshop is the first to integrate pricing and business models with development and deployment. The workshop will be held on May 13th, the day after the OpSource and SIIA event SaaS Summit: All About the Cloud at the Westin St Francis Hotel on Union Square in San Francisco. The workshop venue is conveniently located one half-block from the St Francis, at the Donatello Hotel on Post Street.

Which companies can benefit by attending this workshop:

• A new venture or as an ISV with on-premise products considering developing a SaaS offering
• A service company with significant vertical expertise than could be delivered and monetized in a SaaS model.
• An existing SaaS provider who made choices opportunistically that now constrain growth and cash flow.
• A SaaS entrepreneur with limited funding that needs to achieve positive cash flow early with products that evolve with the market.

Company challenges this workshop can help overcome:

• Building out a suite of products but are unsure of the pricing and operational models needed to grow.
• Developing a framework for sorting out technical and strategic choices required to move to the SaaS business model.
• Facing significant operational problems including efficiency while keeping churn under control in an existing SaaS product.
• Ensuring the pricing model, development framework and operational plan will work in complex, highly competitive markets.

Topics to be covered:

• What Makes the SaaS Model Different and Difficult?
• Making Development Choices Strategically
• How to Choose an Effective Pricing Metric
• Creating a Lean Product Development Roadmap
• Using Packaging and Licensing to Increase Success
• Finding the Right Price Levels and Discounts
• Operating a SaaS Business
• Auditing Your Plans with a SaaS Reference Framework

Because of the value of this workshop, the importance of the SIIA/OpSource conference for SaaS providers and the convenience of the venue, this is an excellent opportunity to “put it all together.” The workshop content makes it well suited to a mixed group of business and technical members of your team because it joins the issues of both sides into a single view.

Per Person Pricing

Group Promo Codes

Three or more members of the same team:

• On or before May 3rd – 57KA5G
• After May 3rd – 7GNGBH

All attendees will receive copies of the workshop materials. The workshop fee also includes a “working lunch” and refreshments during the day.

Secure Registration with Acteva.

Hotel

The Donatello Hotel has a limited number of rooms available for workshop attendees at $139 during the period of May 9-14. This is an excellent opportunity to save with a very convenient location if you are also attending SaaS Summit/All About the Cloud Event.

• To receive this discounted rate, you must the contact the hotel directly at 415-441-7100 – and ask for In-House Sales and  the “SCIO Pricing” discount.

About the Speakers

Michael Dunham, VP of Service Engineering – Scio Consulting
Mike Dunham has more than 20 years of hands-on experience helping major corporations and government agencies succeed in an increasingly technical environment. As Scio’s principal consultant, Dunham provides clients insight into trends that affect business and technology planning so the processes Scio uses can bring clients’ ideas to life. As the VP of Service Engineering, Michael defines Scio’s service products and operational processes. A native of Sacramento, CA, he holds a bachelor’s degree in business administration from the University of California at Davis.

Jim Geisman, Principal and Founder – Software Pricing Partners
Jim is an acknowledged expert in software pricing and, since founding the firm in 1982, has helped several hundred companies develop effective pricing models and strategies. His consulting spans established and emerging software companies delivering B2B solution via desktop, enterprise-class and, more recently Software-as-a-Service / on demand software. Jim has been a board member or advisor to several early stage technology companies. He holds degrees in Electrical Engineering from Tufts University and an MBA from Harvard Business School.

A quick introduction on our podcast:

I’ve seen a lot of different “roadmaps” for SaaS products lately. Some of them are good guides for specific questions. Some are simply misleading or poorly focused. But only a few of us are talking about the two guiding thoughts behind a realistic roadmap that are critical to success:

1. Developing a product that customers want, will pay for and will advocate
2. Finding and scaling an economically viable business model without wasted time or money

These two points form the basis for a slowly building consensus among founders of successful (and some failed) SaaS companies and those of us who have been involved in multiple projects over time. If you haven’t come across them, you will if you need to go for funding of any kind or show a business model these days. These folks are in the business of making money from the SaaS business model and developing companies with a worth that is many times their investment.

People who are unfamiliar with the Lean concept often think that it means developing a product that is at best, minimal and at worst, a product that is too basic and that no one will actually want. We’re used to the idea that it can easily require a two-year development cycle to get a fully-featured product to market. So, when someone says, “We can develop a SaaS product in six months or less!” there is a tendency to dismiss them as novice product managers or marketers.

If this has been your thought, I don’t blame you.  You should question what is behind that type of claim. If it is just the size of the development team that can be brought to bear on the project, I would remind you of the old joke in production engineering:

“While we know that it is true a woman can produce a baby in nine months, this does not mean it is also true nine women can produce a baby in one month.”

For our own part, we’ve developed our concept of lean product development based on careful analysis of what we could provide to our customers to help them be successful. Rather than repeat the entire mantra – let me call out some leading references you should be familiar with for evaluating your roadmap:

• Bessemer Cloud Computing Law #1 – Less is More! Leverage the cloud. Don’t spend money to build features that don’t provide direct value to the end user.  Go into the market and “rent” services. Services allow you to concentrate your resources (time, talent and money) on your core value. They will in fact be richer and more cost effective than anything you can afford to develop.
• Steve Blank – Perfection by Subtraction – Having a clear, tight vision helps to keep development scope down, but it isn’t the key to the “minimum viable product” often mentioned in discussions about product development.  The key is to get a product in front of customers who can understand the vision and who can become evangelists for it because – They have a problem your vision will solve. They understand they have the problem. They have been actively looking for a solution. They have put together some parts of a solution themselves. They have or can get a budget for something that solves the problem.  These customers can validate the vision and will actively pull it into the shape that fits their context. With them behind you – you can develop a beta product that is much closer to what the market needs.  This is also part of Bessemer’s Law #5 – Build Employee Software – which talks about the “consumerization of software” that SaaS has enabled.
• David Skok – Why Startups Fail – The business model is just as important as the feature set in the end. We’ve all heard of great products that never sold enough to return their investment before failing. Learning if you have a market fit, if you can actually scale your operations profitably, if the cost of acquiring a customer (CAC) is less than the average lifetime value (LTV), and if you are going to have enough cash when it comes time to hit the marketing accelerator pedal – these are differences between success and crash and burn. They come down to having a roadmap that gets you into the market early, allows you to test your business model and your product before you have burned all your cash.
• Eric Reis – The Promise of the Lean Startup – Leverage the Agile methodology and philosophy to develop progressively based on customer pull rather than a miracle of market anticipation. We’d all like to be Apple, but we’re not – and getting there is a lot harder and more expensive than we need to expend ourselves on.  The SaaS multi-tenant model allows incremental releases and fixes, usage monitoring, and real feedback-driven products that customers pay for. Eric has a very good presentation with the difference between two companies he was with – that brought him into Lean thinking.
• And finally – Evangelous Simoudis – Criteria for Determining a Company’s SaaSyness – This brings all the previous ideas together with having a successful business model and product BEFORE you go for funding. This puts funding when it will do the most good – when you can use the extra acceleration to get the proven product in the market and when in the classic hockey stick market model, it will be easier to get cash with attractive terms.

But – that means having a roadmap that allows you to make these things happen with a reasonable investment. It means signing up customers and getting cashflow before you reach what you might otherwise think was a full-featured product. It means a company with a product in a licensed model will have to think a little differently than a startup to retain their existing customers, but the larger picture should remain stable.

So, coming back to the premise of this article – a realistic roadmap for SaaS should allow you to -

• Validate your vision with early adopter/evangelist customers as soon as you can show them your the core of your product’s business value.
• Test your marketing, sales and operations during a beta that is still less than a full-market version, but allows you to show your vision to the broader market and get further feedback.
• Leverage services and products that allow you to focus on developing the core value and keep your choices in line with business outcomes – lower initial cost and faster time to market.
• Keep your investment to a reasonable level, particularly in advance of breakeven, and allow high power funding to come when it can do the most good – when you have a proven product and customers.
• Allow early cashflow by having a product driven by paid customer demand.
• Be Agile and flexible in both your product development and your business model.

At Scio – we have used these points to come up with a general roadmap that we customize for each customer’s situation.

Our choice of methodologies, tools and technologies is similarly aligned to ensure we can execute successfully at each stage. Every outsourcing company will decide where they need to focus but for us this means:

• Using the .NET framework as our core techology base. This allows us to apply common skills across a variety of devices and applications and to tap into a much larger commercial resource pool for staffing. It also keeps costs low because we can focus on building best practices and development patterns while leveraging a large pool of libraries that are available for .Net.
• Building on a SaaS application server – SaaSGrid – that lowers the total cost of development and provides the common SaaS monitoring and operational needs. Sticking to one “best of breed” application server that we understand the internals of lowers risk and “discovery” associated with learning new development patterns and allows us to focus on the problem of delivering business value to end users.
• Leveraging Agile and Lean methodologies internally to allow us to deliver useable software early with feedback from customers and operate with high efficiency.
• Use a Nearshore model to put us in closer contact with our customer base and to better enable the promise of collaborative software development embodied in Agile.
• A production model that can apply consistent approaches and learning across engagements rather than approaching each project as a “one-time shot.”
• And finally – a business model that not coincidentally has a lot in parallel with the concepts we expect our customers to embrace.

That is just the choices we’ve made.  Making these choices is a lot like we ask our customers to do when picking a feature set. We purposely left “opportunistic” approaches off the table that would mean we had to spread ourselves a lot thinner to support them at the same level as our core. It also means we can concentrate on improving our core value set without compromising the services we deliver.  We concentrate on our core – developing successful SaaS products repeatably, economically, and quickly – and let our customers do the same for their clients.

So what is your roadmap? Does it align with the ideas we and others have offered in recent articles on developing Internet-based products? It’s all about using the delivery technology that underlies SaaS products to your best advantage in the end.  Whether you develop your product in house or with a product developer like Scio – I strongly suggest you consider your roadmap and the driving vision behind it. It can save you a great deal and lower your risk greatly.  Worth considering…

SaaS is not a “one-size-fits-all” business. There are many options now for platforms and services you can use and the number is increasing every day. A lot of the information available is laden with marketing hype. How do you make the right decisions?

We’ve been helping companies transition to SaaS as startups and from traditional licensed software for several years and we’ve build up a practice we use repeatedly to navigate the choices. We’re bringing our practice to the Dallas SaaS University event as a workshop to help SaaS executives and entrepreneurs make the right choices for their business. We’re passionate about helping companies succeed in SaaS and we’d like to pass some of our knowledge on to you.

You can take this workshop combined with your signup to the University event or separately, but I encourage you to take advantage of the combined pricing that is available. This is not a “technical” workshop – we will be covering how the technical and business decisions SaaS requires impact your business and product strategy. We’ll be using interactive exercises to help you put the concepts into your context and build something you can take back to your team. It is a full day with a catered lunch and will be a limited group so you will have plenty of opportunity to ask questions and be involved.

UpDate! – Use Discount Code: SCIO100

Here’s the outline:

Charting Your Course to SaaS

Making the Right Decisions for Your SaaS Product

Overview – How is a SaaS Product and Business “Different”?

• Leaving 30 years of industry history behind
• Transitioning to a service-led model
• 10 ways to fail

Your Service is Different

• What does making the right choices mean?
• Understanding your market, product strategy, roadmap, supporting technologies, and skills needed.
• Knowing flexibility is key in SaaS

Sell the Right Product

• Map your core product and customer assumptions
• Consider test marketing plans
• Developing a go-to-market feature set

Make Strategic Development Choices

• Selecting services and platforms
• Selecting a technical architecture
• Making development and deployment choices

Operating a SaaS Business

• Understanding service-led business requirements
• Leveraging operational metrics
• Understanding end-user interaction in SaaS and product management

Who Should Attend?

This workshop and seminar is important for anyone considering a SaaS product, in the process of developing a product or offering a product that hasn’t reached its potential, including: Entrepreneurs, CXO’s, product managers and key executives in startups, vendors moving to SaaS or existing SaaS companies.

About Your “Professors”
Luis Aburto, CEO of Scio Consulting, is a veteran of international technology and engineering consulting for corporate and government clients in the U.S. and Latin America. Mr. Aburto is the founder of Scio Consulting, and in 2006 was responsible for focusing the direction of the company on SaaS enablement services. Luis has worked with a multitude of software companies of all sizes and across many industries, helping them make the transition to SaaS.

Mike Dunham, Principal Consultant of Scio Consulting, has over 25 years background in the development and introduction of new technology working with startups, government and the largest enterprise software companies. He has worked with Scio for five years, regularly authors articles on SaaS and the software industry and hosts a series of podcasts on SaaS best practices. Mike leads Scio’s professional services helping companies develop and bring to market new SaaS offerings.

As I mentioned – there are several ways you can join us in this workshop and I very happy we have the opportunity to bring it to SaaS University. I’m looking forward to meeting many of my friends at SaaS University for the event. If you would like to know more about what we’re going to be doing or some help building the case so you can get company support to go, just let me know. See you there!

It has been a long time coming, but we’ve finally gotten our blog in place. We’ve wanted to have a place to speak to the industry and our customers for quite a while. We hope you find the posts here informative, short and useful.

To beat our own drum – we’ve made a lot of changes recently at Scio. We’ve moved to our new Nearshore Development Lab in Morelia, Michoacan (yes, that is in Mexico). We’ve formalized several of our services to meet the needs we’re finding in the market. And yes, we’ve started this blog.

We’re not going to stop there – so stay tuned. Subscribe to our RSS feed or just bookmark us. Thanks!