There is a difference between how a first-time SaaS Founder approaches picking a SaaS idea and building a business vs how a second-time Founder approaches it.
Comparing it to my own experience, it completely matched up. In this post, I’m sharing what those key differences are so you can pick your SaaS idea and stress test your SaaS business.
I’m also going to walk you through the three principles of picking the right SaaS idea with examples I think are really great to go after.
- Timeless SaaS Ideas and Markets
- Existing Series B Companies
- Your Own Domain Knowledge
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One of the earliest SaaS ideas I came up with was called Recommend. I toiled away my nights and weekends into building it — but… it never saw the light of day and never earned a $1. I fell into what I call the “one more feature trap”. Fast forward a couple of years and when I approached building ToutApp… I approached it in a completely different way.
What was the key difference? With ToutApp, I first figured out the right market, then I figured out the distribution, and THEN I focused on the product. I made sure from the beginning that there was already a market for what I was building and that I was solving an urgent and important problem. This is the big difference in how I see 2nd-time Founders approach the idea phase of their company.
Second-time Founders think about the market before anything else. They understand that market and distribution are everything.
If you’ve been following me, you know I share that great SaaS businesses are built on three pillars: market, product, GTM.
When you optimize all three of them, that’s where the money is. Where the product-market fit lies. Second-time Founders understand this.
This is the base context, but what are some great ideas that have a market?
Let’s get into the key principles that give you three different types of SaaS ideas that you can dig into so you don’t waste that first lap. Instead, you can optimize for the market first then everything else. It will save you months of building the wrong product.
Timeless SaaS Ideas and Markets
These markets are timeless because the problems are timeless. You can build:
- A To-Do List App
- Note-taking App
- Messaging App
There is always a new market for these examples. If you have a unique angle or spin you can go after it because there will always be a market for it.
If you want to dig more into timeless SaaS ideas, check out my video that covers the three types of golden SaaS categories. Any successful SaaS business you know can be placed in one of those categories.
Existing Series B Companies
Targeting newly-minted Series B companies are a great way to identify a hot market. This is a small company that has raised a large amount of money because they’ve proven product-market fit and revenue, but still need to scale. This means you can disrupt them.
These companies are super powerful because they’ve done a lot of the hard work; taking the market risk out of the process. They also tend to have older tech stacks, legacy baggage, execution risk so you can go after them and pick up where they left off.
If you want specific examples of Series B companies check out these key opportunities between 2020 and 2025.
Your Own Domain Knowledge
Your own domain knowledge could be a great source of proven marketable ideas. What do I mean by that?
Some of the best SaaS companies started as spreadsheets. Then they turned them into a proper SaaS company.
So, reflect on your past experience and what problems you can solve that you have a lot of domain knowledge on. You know that people have that problem because you at one point had that problem. One trick is to find the spreadsheets that currently exist in your job that can be turned into SaaS businesses.
SO. Here’s what we’ve covered:
- Market and Distribution trumps product
- Above I’ve given you 3 key ways you can identify hot markets
- And from there, you can start to flesh out your Go-To-Market and Distribution as you build your product.
There is a difference between obsessing about just the product. First, you need to figure out where the market and demand are so that you can serve it with a really compelling product. Remember, you don’t want to fall into the one more feature trap in an untested market.
If you as a SaaS Founder can embrace this shift right away of putting market first, then distribution, then product – you will be unstoppable. Also, if you’re in this stage of working on a SaaS idea, this is why I created my 10-Point SaaS Business Checklist.
I’ve taken everything I’ve learned in my 15 years of being in SaaS and put them into questions for you to follow and stress test your SaaS idea. Lastly, check out the video above that recaps everything we just discussed and more.