TripleTree, an investment banking firm, and the Software & Information Industry Association (SIAA), in a prescient report released last year identify among the key factors of success of Software As A Service:

• Scalability and Critical Mass. Above all else, SaaS firms must maintain their focus on building their customer base and scaling to profitability, since payment streams are considerably smaller at the outset when compared to the traditional licensing model
• Narrow Solutions and Quantifiable ROI. Due to the investment required to reach scalability, the SaaS firm cannot afford to run the risk of being "all things to all people."
• Client Acquisition & Retention. Strong customer acquisition and retention metrics are vital to Saas firms, as their business model requires a rapidly growing customer base with minimal turnover
• Sales Channels & Partnerships. Many SaaS firms find traditional indirect sales channels with major systems integrators somewhat restricted, since their rapid implementation cycles eliminate large sources of revenue for the service firms
• educating the Market. Moving beyond the "base case" for software as a service, which brought the traditional arguments for IT outsourcing down to the application level, the new approach is centered upon replacing the usual software vendor relationship with a new relationship that creates value in terms of both technology and service.

Source: Zdnet



via: EmergicPrashanth RaiPrevious posts on SAAS here:
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