31 things I learned the hard way about growing a SaaS business. GBP from Duane ‘Startup’ Jackson, Kashflow

A guest blog post – a quick read with 31 real life lessons learned building a SaaS business. Introducing Duane L Jackson, he’s like ‘Startup Jackson‘, but real.

Not Real

Startup Jackson – Not Real

There is so much well meant ‘advice’ out there on blog posts about entrepreneurship and how to do this our that it is sometimes hard to find things that add genuine value. We get pitched some ‘valuable insight’ every day for a guest blog post and the overwhelming majority of it is awful, derivative nonsense from people that write about, or write about other people writing about, being an entrepreneur.

Duane is different.

Any successful entrepreneur with a bio that includes the words, ‘which culminated in my arrest at Atlanta Airport with 6,500 ecstacy tablets‘ is not your usual sort of guy.

Duane says he became an entrepreneur after the subsequent, almost inevitable, prison sentence because he was left with no alternative given the ‘large black hole in my CV’. He set up a web design business with the help of a grant from The Prince’s Trust a UK based organisation to help give people a second chance.

Almost immediately, he hit a problem. He couldn’t understand why accounts programmes were so complicated. This became the realisation that was the inspiration for KashFlow, a SaaS based simple web accounting package for small business.

I should declare two interests – 1 Duane has become a good friend over the years. 2 Our business uses KashFlow. We are a very happy, fully paid (we might be friends but he is too mean to give a discount :-)), KashFlow customer.


Here, he has shared some of the things that he has learned building his business over the years. Don’t expect some clever unified theory of entrepreneurship – though he has some great ideas there too – here are 31 gems of learning learned by building a SaaS business from scratch. Mistakes and all. Hope you enjoy.

Duane Jackson, Founder, Former CEO, KashFlow:

“It’s been nearly a year since I sold KashFkow. It’s taken most of that year to ‘decompress’ after the years of hard graft.

One of the things I’ve enjoyed doing in the past few months is giving advice and feedback (mostly solicited) to other SaaS startups. I thought it might make sense to compile and publish some of the recurring themes, so here they are:

I hope at least one point here gets you to think about something you might be able to do better.”


  • Your early customer acquisition process shouldn’t be scalable. When I started KashFlow I got our first customers by going to networking events and selling in-person. Not really practical long-term for a service that costs £15 a month. But it got those early customers in and ensured a personal connection between them and me meaning I could call them up and get honest feedback.
  • Stay on top of your cost of acquisition of new customers. Make sure you know how to work it out. It’s an important number that should inform a lot of your decisions. But be aware it’ll be a long time before you have any clue about the life time value of a customer in a subscription business.
  • Work out who your customer is. I don’t think that we  ever decided whether we were best suited for ‘greenfield’ sites (companies that had never used accounting software) or people migrating from other products. If we worked that one out, or at least who we were primarily targeting, I think we’d have grown more quickly.
  • Get close to your early customers and bend over backwards to help them. You can add new features very quickly to delight them. Your larger competitors  can’t do this. You can also be much more responsive and personal on the support front. Make the most of those advantages. It’s fine to do stuff to get and please your early customers that won’t scale when you have tens of thousands of customers. It’ll be a nice problem to have when you get there.

Product and website

  • Remove all friction from your sign-up process. Watch someone to go through it – how many times did they need to think about what to put in a form field (not just about what to enter, but whether they want to even share that info with you)? How many choice did they have to make (Do I want the small, medium or large package?) Don’t give them a chance to change their mind once they’ve clicked the button to register. You want their email address in your database as soon as possible.
  • Show personality in your product. Software is bloody boring, don’t be boring. We were accounting software – it doesn’t get much more boring than that. But by being a little light-hearted and informal we managed to lift some of that tedium. Sure, some people will tell you it’s ‘unprofessional’. Whatever. You can take it further and have an actual persona representing your product. We all know Aleksandr the meerkat.  It’s memorable. Mailchimp does the same in software with Freddie the Chimp.
  • If you don’t have an API then you might as as well not exist. Ideally RESTful.
  • You should be constantly split testing, but don’t make this mistake.
  • Don’t re-invent the wheel. The beauty of building a SaaS product now in comparison to ten years ago is the availability of off-the-shelf components. From affiliate management to billing to email delivery – the less code you have to write, the less code you have to maintain.
  • Once the potential customer has registered for a trial, the race is on to show them some value as soon as possible What this means will depend on what your app does. For us we needed to get them to create invoices or view reports (based on imported data). So guide the user through this process.

PR & Marketing

  • Consider an Invite-Only Private Beta. It doesn’t have to be as exclusive as it sounds, but making it seem exclusive can make it more appealing. Who wouldn’t want to get in to a club where you need to be on a guest list to get in? But make it easy for your existing Beta Users to invite others. This encourages social media posts about your service – “anyone got an invite code for Flinkywinks?”
  • You’re a tiny mouse. If you want to be seen then find an elephant and jump on its back waving a flag. We climbed on the back of Sage and shouted about how we were doing things that they couldn’t/wouldn’t. Be sure you have a valid case though, if you’re bluffing people will see through it. And be careful who you choose. Some established companies have a lot of love.
  • If your elephant is a public company then make sure you court analysts just like you would journalists. Analysts want to understand what it is that BigCo PLC isn’t doing so well (the stuff you are doing well). Help them understand, but do be honest and as impartial as you can. I spent a lot of time explaining to analysts what SaaS is and why I thought Sage couldn’t/wouldn’t do it properly. Getting cited in research papers not only pissed them off but also raised our profile among investors and potential acquirers. And did a lot to increase our credibility.
  • Be a human on Twitter and other social media, not just a company. Who want’s to “engage with a corporate identity”? BigCo PLC rarely has an individual that can be a figurehead for the business (there are exceptions). You ARE your business, you’re living and breathing it, right? By all means have a company Twitter account, but promote your own too and engage with your customers on all topics, not just about business. It’s called social media for a reason.
  • Re-target like crazy. If you’re paying per-click and not per-impression, what’s not to like? Your adverts will follow existing customers/users around the web. This is a Good Thing. You’re everywhere! You must be doing really well. They were very clever to have chosen to use your service. I suspect (but can’t prove) this effect improves retention and maybe increases word-of-mouth.
  • Why are you using a PR firm, what are they doing for you? If you haven’t got a good answer for this then stop using them! This seems to be one of those things lots of businesses do just because they think they should.
  • Master the sound bite. Get to know some journalists and be available to them to comment on stories. If you learn to phrase things well for them you’re more likely to be quoted in a story and be approached again. If you can say nice things about your suppliers, then there’s free PR to be had.

Targets and KPIs

  • Make sure you measure the right things, and log the metrics. Can you look back exactly 30 days and tell not just how many sign ups you had that day, but how many people logged in that day? If you’re not logging this stuff as snapshots then it’s a real bitch to try and calculate it later on from various pieces of related data (and your DBA will have a fit every time you run a management report)
  • Have targets, even if they’re arbitrary at first. How many new customers are you aiming to get this year? “As many as possible!” is the wrong answer that I used for a long time. Pick a number that sounds about right, then work out roughly how you’ll get there (how many each month from each channel). Then track your performance. Adjust your target if it seems way off. If you don’t have a target then at the end of the year you’ll have nod idea whether the number you achieved was good or bad.
  • Reporting to your board every month shouldn’t be a pain in the arse. If preparing data and updates for your investors/board every month is time consuming and frustrating then you’re doing something very wrong. What you present should naturally come from the KPIs you’re measuring regularly anyway, along with explanatory notes about why you’re under target (again). This topic probably deserves it’s own blog post. It changed my world when I finally got the hang of this.


  • Keep an eye on them, but don’t become obsessed by them.
  • Become friends with them. We never bashed our real competitors – Xero and FreeAgent – and they never bashed us. In the earlier days the founders of all three firms (and others) could be found in a pub together. Sure, there was some dis-information being spread but it was also very useful having a direct connection.
  • Don’t advertise them! We’d show price comparisons against the names everyone knew – Sage, Quickbooks – but not our SaaS competitors. I’d paid good money to get this potential customer to my site. I wasn’t going to tell them about a competing service they may not have heard of.
  • Be skeptical about their outward appearance. Everything might appear to be rosy whilst you’re having a hard time, but trust me – they’re having their own pains.
  • Don’t be afraid to copy them. If they add a great feature, you add it too. There’s no shame in it.


  • Make sure you charge enough to make a profit AND pay a cut to partners. There will always be unforeseen routes to market that require you to sacrifice some of your margin. Make sure you’re able to sacrifice enough to make it worthwhile for everyone involved
  • Be wary of “big” opportunities, especially if they’re not directly aligned with your main objectives. A lot of time can be wasted because you were approached by a household name for some special project. The length of a partnership agreement document is inversely proportionate to it’s likelihood of being a success.
  • Be as transparent and honest as you can, especially when it comes to any problems. Never try to blag your customers with fudged versions of the truth. Weren’t testing your backup processes so lost a load of data? Admit it, say sorry, tell them what you’re now doing differently. We all cock up occasionally, it’s how we deal with it that matters. You’ll be surprised how much loyalty, respect and understanding this approach buys from your customers.
  • Be decisive. It’s better to make 3 decisions a day and one of them was wrong than it is to make one perfect decision a day. You can always change your mind if it doesn’t work out.
  • Don’t get caught up in ‘the scene’. You could go to a conference or dinner or meet-up every night of the week if you wanted to. And if you’re that type of personality you could easily mistake being seen for doing real work. There are a lot of people out there that are well known but have achieved sod all besides being well known! Get your head down and crack on, there’s work to be done!

If you found any of this useful, please do share it with others. And let me know via twitter: @duanejackson

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If this was interesting, you might also like Gail Goodman’s talk, ‘The Long SaaS Ramp of Death’ telling the story of building Constant Contact to a 1,000 employee, $ 1 billion market cap public company.

Spoiler alert: there are no silver bullets.