7 Serious SaaS Business Mistakes (and How to Avoid Them)



It’s almost a new year, and many of you are probably thinking about growing your SaaS business. But what do you do if you’re already struggling with growth? Or maybe you’ve noticed some significant mistakes along the way and want to fix them before they worsen. In any case, several common SaaS business mistakes can derail even the best-planned SaaS businesses. Here’s what they are — plus how to avoid them:

Do it all by yourself

You can save yourself much trouble by hiring people who are more intelligent, better, or faster than you. There’s no shame in that—you’ve got plenty of stuff to do that they don’t!

Don’t try to do everything yourself. You might be super-smart and have lots of experience in this field, but it’s better to get the input of a larger team of bright people than try to solve every problem yourself. After all, you’ll eventually have thousands of customers who will bring their perspectives. You could start hiring a team that brings a diversity of opinions to your planning process.

“I’ve learned the hard way that hiring the right people is one of the most important things you can do. It’s been said that ‘the average small business owner has over 90% of their time spent on tasks that are not core to their business model.’ I’m sure we’ve all been in this situation before—trying to juggle too many things at once and feeling like no matter how hard we work, it’s never enough.”

Don’t talk to your customers

As a SaaS founder, your job is to talk to your customers. You need to get feedback from them and ask for advice. The best way to do this is by asking questions that will help you understand what they want your product or service to be. Ask them if they are satisfied with how things are working now and if there is anything that could be improved. If you are having any issues with a particular part of the business, then this is also an opportunity for you to get involved in the conversation about how the problems should be solved.

Make your UI counter-intuitive

One of the biggest SaaS business mistakes you can make is to create a user interface that needs to be more intuitive. Your users will need clarification and support, making them less likely to stay around. Make sure your UI is easy to navigate and understand without prior knowledge of what it does or how it works. If you create a new feature, then ensure you have tested it with real users. It would help if you never assumed that people would understand how something works; instead, make sure you have proof of concept before rolling it out.

Forget about competition

You don’t have to worry about competition. Sure, it’s easy to get caught up in what a competitor is doing—but you should focus on your product and business, not on the competition.

Competition is good for you! It helps ensure that more people are aware of you and your product, which leads to more users and better reviews. Your competitors might even introduce new features or pricing strategies that help improve your business! So embrace them with open arms instead of fearing their presence.

Offer too many pricing models

Offering too many pricing models can confuse customers and reduce your ability to make money. In a study of SaaS companies, researchers found that those with the most flexible pricing structures had a much higher churn rate than those with more uncomplicated, more straightforward plans. This finding suggests that offering a simple pricing model is essential for increasing customer retention and lifetime value.

However, it’s also worth offering flexibility in your pricing plans so that customers can choose how they want to pay you over time or in different situations. For example, you could provide an annual plan and monthly billing options—this way, people who only need occasional access can pick whichever option works best for them at any given time without committing to a long-term contract upfront.

It can also be helpful to offer different plans to different segments of your user base. Users who need additional support help should be paying additional fees. Small business users who require little extra support can be offered lower-price plans.

Ignore security flaws

Security is a critical part of any SaaS but is also one of the most frequently overlooked areas. The costs of ignoring your security can be exorbitant and range from temporary brand damage to loss of customers and revenue (and even legal action). A recent survey found that 80% of companies have suffered security breaches—and those who are breached are three times more likely to lose customers than those who aren’t.

In addition to the potential loss in revenue that comes with losing clients over security concerns, companies ignore their users’ needs because they believe their products are intuitive enough that people won’t need help understanding how they work—but this isn’t necessarily true. If you’re building something new or upgrading an existing product, you may think it’s obvious how things work based on your understanding as an employee or founder; however, and there could be hidden bugs or features that could easily confuse someone using your service for the first time.

Don’t plan for growth

If you’re like most SaaS businesses, you want to grow.

The best way to plan for growth is by building scalability from the beginning of the process. Build out scalable infrastructure and operations that allow your team to add more members as they come online.


We hope you’ve found this guide helpful in building a solid foundation for your SaaS. It’s not easy to take on the responsibility of creating a product that will affect so many people. Still, by keeping these common SaaS business mistakes in mind and working hard to avoid them, we believe you can impact the world around you.