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How to Choose a SaaS Development Company: Full Guide

June 11, 2021
12 min

According to Gartner’s 2020 I&O Leaders Survey, more than 70% of enterprises are investing in SaaS solutions and plan to continue using even more public cloud offerings.

These statistics show how fast-growing the SaaS market is that stimulates more and more entrepreneurs and startups to consider this vertical as investment-worthy.

So, you have come up with the project idea and now it’s high time to find a SaaS development company to help you build software that rocks.

For this reason, we have prepared an article which includes the following topics:

  • SaaS application development: definition and benefits
  • Key aspects to raise while choosing a SaaS product development company
  • Our checklist with tips and tech-savvy questions for a software vendor.

Let’s start the key aspects you should pay attention to while choosing a SaaS development company for your project.

What to Pay Attention While Choosing a SaaS Development Company

1. SaaS product development background

We recommend first analyzing a vendor’s SaaS application development background. It means that you need to review their case studies and check the projects they have built.

An experienced software development provider should definitely have an insightful website where they highlight their strengths in SaaS product development. Check their services pages, case studies, and testimonials to find acknowledgment of their expertise.

Case studies are a great section where you can learn more about the SaaS apps they have developed along with:

  • Key challenges they’ve met
  • Core solutions they’ve built
  • Clear and measurable results they’ve achieved
  • Clients’ reviews they’ve provided.

Apart from a SaaS development company’s website, we recommend visiting their Clutch, G2, UpWork, CrowdReviews, and GoodFirms profiles.

Undoubtedly, experienced companies should have them to grow brand awareness and increase credibility. In case they don’t, it should give you a pause for thought.

These platforms list helpful reviews of a SaaS development agency’s clients with their contacts. So, you can even email them to know if they liked the cooperation process and the results achieved. This allows verifying whether the SaaS development company provides truthful information on their website.

Here is an example of a client’s review on Ascendix Tech profile:

ascendixtech-client-review-clutch

Ascendix Tech Client’s Review on Clutch

Beyond the high-level SaaS application development background, you can pay attention to specific projects within a market niche you’ve chosen.

For example, if you want to build a SaaS app within a Real Estate vertical, we provide a niche-specific case study on how we build a custom real estate listing software for Colliers International Indiana.

custom-real-estate-listing-software-development-case-study-ascenixtech-colliers

Custom Real Estate Listing Software Development for Colliers International Indiana | Ascendix Tech

Such works give you even more understanding on the software vendor’s expertise and experience.

What’s more, it is a totally normal practice to ask a potential SaaS development company to connect you with some of their clients.

Now we want to draw the line and share our tips on how to review the SaaS application development background of a software vendor:

  • Always analyze and place faith in the relevant case studies
  • Try to check testimonials and contact companies’ clients to gather their feedback
  • Review the SaaS development agency’s website to know if they specialize in software-as-a-service or not.

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2. Technology stack

For sure, you want to have a high-performant, scalable, secure, and sustainable SaaS product that could be easily modified and updated.

All these characteristics become possible if you choose a SaaS app development company using the latest programming languages, frameworks, and libraries.

What’s more, partnering with a software vendor specializing in a specific set of technologies is mostly a better decision than choosing a SaaS development agency that uses hundreds of tools.

For example, you want to build a front-end part of your SaaS application in Vue.JS, then find a partner working with Vue.

If you want to have a server-side in Node.js, then consider companies that mostly work with Node.js for backend app development.

The more experience and expertise a SaaS development company has working with several technologies, the higher quality of SaaS product they will provide.

At Ascendix Tech, we focus on Java, .NET Core, Xamarin, Vue.js, and Node.JS to supply our clients with tech-savvy and high-quality technology solutions.

Also, we use more advanced technologies to meet most possible clients’ needs and build SaaS applications that solve exclusive end-users’ problems.

ascendixtech-technology-stack

Ascendix Tech technology stack

 

Additional services

Apart from the SaaS application development, we recommend paying attention to other technology services that SaaS companies provide.

 

UI/UX design

First, your SaaS application should have a visually-appealing and intuitive user interface. So, you can ask a software vendor whether they offer UI/UX design services and review their design case studies.

 

QA testing

Second, you definitely want to have a bug-free SaaS product as it plays a crucial role in the future churn rate and customers’ satisfaction. According to the QualiTest Research Survey, 9 out of 10 users would stop using an application if experiencing bugs or inconsistent performance.

For this reason, ask a SaaS development agency if they have a QA department focused on quality assurance of the built software. Also, you can ask a potential software vendor the following questions to have better insights into their QA expertise:

  • How do you approach software testing?
  • What QA methodologies do you use (unit testing, vulnerability/security testing, etc)?
  • Did you have a negative experience with bug fixing?
  • How did you solve the product performance issues after launch?

 

Post-launch support & maintenance

When you release a SaaS product to the market, it’s of utmost importance to monitor its performance as it may greatly increase the churn rate.

So, you will surely need to support your SaaS application after launch and keep it bug-free and high-performant throughout its lifecycle.

Make sure to check whether your SaaS development company provides post-launch support and concierge services. It will help you eliminate emerging bugs and errors quickly, solve customers’ problems instantly, and keep your churn rate low.

Otherwise, you will most likely need to find someone else to approach bug fixing and performance measurement of your SaaS product.

 

Cloud migration

Cloud migration services for SaaS applications are a common practice as entrepreneurs may want to choose the model from SaaS to IaaS or PaaS.

Here comes the need for flexibility and scalability of your SaaS product. What’s more, cloud migration services offer such opportunities as cost reduction, digital security improvement, deployment performance enhancement, and high overall efficiency boost.

For these reasons, make sure a development company has expertise in cloud migration so that you won’t change a technology partner in the future and waste time on hiring, on/offboarding, and other activities.

At Ascendix Tech, we have been providing cloud migration services for many years which allowed us to supply the clients with 24/7 tech support and DevOps opportunities.

If you want to learn more about our technical expertise, take a look at our case study of on-premise to cloud migration for Jones Lang LaSalle where we describe the key challenges, solutions, and results delivered.

custom-dynamics365-development-cloud-migration-jll-ascendixtech

Custom Dynamics 365 Development and Cloud Migration for JLL | Ascendix Tech

3. Communication and development

Communication

We strongly believe that communication is a huge part of the future product’s success. The more discussions we have, the greater shape of product clients receive.

For this reason, we recommend choosing a SaaS product development company that provides a streamlined communication process.

It should include regular retrospective meetings, day-to-day follow-ups, and a one-stop messaging tool to discuss all project-related activities when they emerge.

No matter what project management tool you use be it Trello, Asana, Jira, or Zoho, daily standups, reports, and a transparent task tracking system are the key data you should get from a SaaS app development company.

 

Methodology

A software development methodology is an important part of building a successful SaaS product. It is about the way a software vendor manages its both time and labor resources and takes care of scaling and adjusting.

According to the Harvard’s Business School senior lecturer Shikha Ghosh research, 3 out of 4 startups fail after launch having strong financial losses.

There are multiple reasons, but you can avoid one of them by choosing a SaaS application development company that follows the Agile approach.

Briefly, it offers high development speed and flexibility. Here are the key benefits it provides:

  • Enhanced productivity
  • High flexibility in terms of on-going project changes
  • Increased transparency
  • A short time-to-market period
  • Efficient communication on each project development stage
  • Risk mitigation.

So, an Agile approach allows you to build SaaS applications fast, iteratively, and transparently along with the possibility to make changes on the go.

One of its key advantages is cost reduction as you can build a SaaS application step-by-step, develop the core functionality, deploy, and start collecting the initial feedback from early customers.

Based on users’ comments, modify/remove/improve the features so that they meet end-users’ needs directly and make them want to subscribe and become your customers.

Agile Benefits for SaaS App Development | Ascendix Tech

Agile Benefits for SaaS App Development

What’s more, Agile provides a subset lightweight framework called Scrum. It allows dividing the project development process into even smaller sprints and deliverables.

This means you can have greater control and transparency over your SaaS product development.

At Ascendix Tech, we use the Scrum framework for most projects due to the opportunities it offers in terms of flexibility, clarity, and key metrics that allow measuring the project’s progress and software teams’ productivity.

4. Business-oriented approach

As an entrepreneur, you definitely want a SaaS development company to build technology solutions that meet your business needs and follow a strict business model you provide.

This means you should analyze not only the technical background and expertise of a company, but also pay attention to their business insights.

You can perform this by asking yourself the following questions:

  • Did the SaaS development agency describe the way the discussed features would help me achieve my business goals?
  • Did the IT company provide alternative technology solutions according to my business model and requirements?
  • Did the software vendor prioritize the development challenges in order to launch an MVP as fast as possible?
  • Did the SaaS development company persuade me from building some features that wouldn’t bring any sense and value to end-users?
  • Have I experienced that a development partner wants to achieve the product’s success as much as I do?

If you answer ‘yes’ to all of these questions, then the chosen SaaS product development company has a good chance of becoming your faithful partner in terms of making your SaaS application a complete success.

For 25 years, we have discussed lots of projects, built multiple technology solutions, and experienced both ups and downs. In that context, we strongly created the following philosophy:

We build long-term partnership relations, and the success of our clients is our success.

- Ascendix Tech

Our checklist with key questions

Our tips

#1 Try to avoid ‘yes-saying’ SaaS app development companies if their expertise is not vividly proved by case studies and testimonials.

The word ‘NO’ is a positive sign in terms of building a great SaaS application that should rock in the long term. So, when discussing the project requirements with a software vendor, pay attention to the way they offer technology solutions to your specific business needs and technical challenges.

In case a SaaS development company suggests using alternative tools or dissuades you from developing specific features as they don’t bring any sense and become just a waste of money, such vendors can become straightforward partners in the long run.

Most likely, they will have as much passion as you do to make your SaaS product a complete success.

#2 Try not to opt for the cheapest rates on SaaS application development services.

In most cases, this theory works well. Even if you choose the cheapest SaaS development agency with solid expertise, the chances are high that you will overpay in the long run.

For example, you can bump into a poor code quality which would become tough or even pointless to scale and optimize.

This will result in additional code refactoring activities or even rebuilding the whole SaaS application from scratch in order to scale, optimize, and fix bugs properly.

What’s more, you can encounter communication issues.

When building a SaaS software product, communication is of utmost importance as you constantly need to monitor updates and make changes if needed.

If a SaaS model software development company experiences language barriers, then it can lead to insufficient transparency of the project development process and hugely impact the final product quality.

Having a large experience of IT outsourcing to 5 locations around the world, we had faced this challenge multiple times before we stopped in Ukraine. So, we know all the possible outcomes of the miscommunication, non-transparent SaaS app development process, etc.

This way, we recommend learning our story to prevent yourself from the potential losses you may encounter while facing such communication issues.

Technical questions for a SaaS development company

  • Will I have the source code ownership?
  • Could you please share with me the best practices you follow while creating a project’s code?
  • How do you approach and ensure software quality?
  • What SaaS model software development methodologies and metrics do you use to measure a project’s quality and teams’ productivity?
  • How do you approach a software discovery phase and what exact outcomes will I get after?
  • What were the key technical challenges and how did you solve them in the previous SaaS app development project (if any)?
  • Do you provide technical support or concierge services after launch?

How [some] technology solutions will meet my business needs and end-users’ demands?

 

Software vendor asks you to pay for a Software Project Discovery. Should you agree?

 

What is SaaS Application Development

SaaS (Software-as-a-Service) is a cloud-based software or licensing model which means that your application is accessible on a subscription basis. Simply put, SaaS software provides customers with a ready-to-use solution online.

One of the simplest SaaS application examples is Google Docs that offers free online documents to create, manage, modify, share, etc. Everything you need is a Google account to sign in, create a document, and start working right in the browser.

All support, update, and fixing activities are held on the SaaS app provider’s side so that clients only pay a monthly fee and get access to the solution using any device connected to the Internet.

What’s more, many SaaS applications now provide offline mode which enables customers to use the software without any limitations being anywhere in the world. Once connecting to the Internet, the SaaS software servers automatically upload their changes to sync up with the system.

 

How can you, as an entrepreneur, benefit from building a SaaS product?

 

First, cost savings.

A SaaS model allows you to save lots of money by avoiding hardware maintenance costs. All you need is to supply your SaaS software with enough high-quality servers that can be also located remotely.

Also, the initial costs required to build a cloud-based SaaS application are mostly much lower than creating local software. Using the SaaS model, you only pay for the exact capacities you need and avoid purchasing hardware to place your application.

 

Second, a monthly recurring revenue model.

When providing a SaaS application to customers, you get payments every 1/6/12 months. This allows you to build a long-run product strategy, update your solution constantly, and keep users satisfied.

You should always analyze a Churn Rate which indicates how many active users stop using your SaaS application. Try to keep this indicator as low as possible to be sure that your customers enjoy the solution you offer.

In case the Churn Rate goes up, we recommend getting feedback from your customers on what do they dislike about your SaaS app. Always try to fix any issues instantly, release new updates that meet current users’ needs, and make clients even more satisfied.

 

Third, a short time-to-market period.

You can build an MVP version of your SaaS software and present it to customers much faster. No need to follow the traditional long-way development process that may take up to 1-2 years.

Just build the key functionality, place the SaaS app on a server, deploy it, and verify the product-market fit after. We recommend starting with a freemium model which allows users first to test your SaaS product with limited features and decide whether they’d like to use the full-featured SaaS app.

This strategy will help you acquire first users, collect feedback, start gaining an initial recurring revenue, and scale your SaaS software for mass usage.

 

Learn other SaaS subscription models in our article: Steps to Building a SaaS Product.

Looking for a SaaS development agency for your project?

At Ascendix Tech, we know how to develop SaaS applications that rock. Complete a quiz by answering a few questions and get a ball-park estimate for your project.

Conclusion

The SaaS app development market is growing rapidly as there is a strong demand for new cloud-based technology solutions. Entrepreneurs and startups want to build new user-oriented software that will revolutionize the market and make people’s lives easier.

We hope our guide on how to choose a SaaS development company will help you find a reliable software vendor who will become your long-term partner.

Our key advice is to measure thrice and cut once before choosing a tech-savvy counterpart for your project.

If you are looking for an experienced SaaS product development company with solid expertise in building high-quality digital solutions, feel free to contact us and we will be glad to engage in a discussion to better understand your goals and objectives and if appropriate, provide you with a free estimate of your project development requirements.

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