There’s been a major shift in the business world over the 21st century as companies close up their brick and mortar shops to go digital.

Software as a Service (SaaS) is a software licensing and delivery model that’s hosted on the cloud where anyone with an Internet connection and device can easily access.

It is sometimes referred to as "on-demand software” because it operates 24/7.

If you want to read more about the basics of SaaS, read our article called “SaaS Basics: Demystifying the New Norm in Software Delivery”.

SaaS applications can be built and customized for any need, niche, or industry.

The SaaS model has become a common solution for many business applications, including customer relationship management (CRM), bookkeeping, onboarding, corporate communication, and productivity tools.

There are many different SaaS solutions depending on the services your company offers and the vision you’re trying to achieve.

First, let's explore the different types of SaaS solutions:

Different SaaS Solutions

Horizontal SaaS

The most important difference between SaaS solutions depends on who your business is trying to serve.

Horizontal SaaS solutions are software products that are designed to serve a function across multiple industries. These solutions are not industry-specific and can be used by businesses regardless of their industry type or size.

Examples of horizontal SaaS include platforms like Microsoft Office 365, Google Workspace, and Salesforce. These platforms offer email services, productivity and CRM tools that can be used by any business.

Vertical SaaS

In contrast to horizontal SaaS, vertical SaaS solutions are industry-specific.

They are designed to cater to the unique needs and requirements of a specific industry or sector.

By focusing on a particular niche, these solutions can offer features and functionalities that are custom-tailored to address specific challenges.

Examples of vertical SaaS that Phase One Ventures has built include Dispute Panda which is a credit repair software for businesses or Cellyce an ecommerce aggregator. These solutions are considered vertical since they provide value and utility to one industry rather than multiple. 

We recently released a case study about Cellyce which you can read more about here.

Enterprise SaaS

Enterprise SaaS is designed to meet the software needs of large organizations.

These platforms typically have robust features that can support large scale, complex operations.

They are designed to integrate with other enterprise systems, have high security standards, and offer comprehensive support and service level agreements.

Examples of enterprise SaaS include SAP, Oracle Cloud, and IBM Cloud. 

Visitor Pixel is an identity resolution software that helps businesses gain non-obvious information about their users’ behavior. The API used in this software is able to filter through enormous amounts of data in order to find patterns which makes it optimal for large enterprises.

Small Business SaaS

Small Business SaaS solutions are designed for small to medium-sized businesses. They are typically more affordable and easier to implement than enterprise solutions.

These platforms often offer a more streamlined set of features designed to meet the specific needs of small businesses.

Examples include QuickBooks for accounting, Mailchimp for email marketing, and Zoho for business management.

Consumer SaaS

Consumer SaaS products are designed for individual use.

These solutions are typically designed with user-friendliness in mind and can be used without the need for technical expertise.

Examples of consumer SaaS include Dropbox for cloud storage, Netflix for entertainment, and Spotify for music streaming.

An example of Consumer SaaS that Phase One Ventures worked on is App Bravo. This software is an aggregator of innovative tools, but what makes it so unique is its centralization on building community. It features engaging elements like reviews, forums, discussions, discounts, posts, and a place to launch more apps, web apps, and browser extensions.

Collaborative SaaS

Collaborative SaaS solutions are designed to facilitate collaboration and communication within a team or organization. These platforms often include features like document sharing, project management, and team messaging. Examples include Slack, Zoom, and Asana.

What Industries Use SaaS

Any industry can benefit from the integration of SaaS but the industries that use it the most include information technology and services, analytics, and financial services. With each of those industries bringing in revenue from $48.7B to $86.5B, it’s easy to see how valuable SaaS truly is in this day and age.

If your company is not in one of these categories, that’s okay. SaaS is still relevant for you.As of 2023, SaaS applications make up 70% of company software which shows how versatile SaaS is. If you’re not an enterprise, there’s still a SaaS solution that works for you and your business.

The Power of SaaS in the Digital Age

The rise of SaaS represents a significant shift in the way organizations consume and use software. The traditional model of purchasing software and installing it on individual computers is rapidly being replaced by the more flexible and cost-effective SaaS model.

SaaS solutions offer numerous benefits, including reduced upfront costs, scalability, accessibility, and automatic updates. They eliminate the need for organizations to invest in extensive hardware, which in turn leads to significant cost savings. Additionally, as these solutions are subscription-based, businesses have the flexibility to scale up or down based on their needs.

The SaaS model also provides greater accessibility. They can be accessed from anywhere, at any time, and on any device with an internet connection. This is especially advantageous in today's increasingly remote and mobile workforce.

Furthermore, SaaS providers handle all updates and upgrades, eliminating the need for users to download and install patches.

This ensures that users always have access to the latest features and that the software is always up-to-date with the most recent security measures.

If you’re interested in 4 more benefits of SaaS, we recommend reading From One Business Owner to Another: Why You Should be Using SaaS.

Choosing the Right SaaS Solution

With so many different types of SaaS solutions available, it's essential for organizations to select the one that best meets their needs.

Here are a few considerations to keep in mind when selecting a SaaS solution:

1. Industry-Specific Needs: If you're in a niche industry with unique needs, a vertical SaaS solution may be the best fit. These solutions are tailored to the specific needs and challenges of your industry.
2. Size of Your Business: Enterprise SaaS solutions are designed for large organizations with complex needs, while small business SaaS solutions are geared towards smaller organizations with more straightforward needs.
3. Functionality: Consider what functionality you need from the software. Do you need a comprehensive solution that handles multiple aspects of your business, or a solution that specializes in one area.
4. Budget: As with any business decision, budget is a critical factor. Consider the cost of the SaaS subscription, as well as any potential savings from reduced hardware and IT costs.
5. Security: Given that your data will be hosted by the SaaS provider, it's critical to ensure they have robust security measures in place.

Conclusion

SaaS solutions have revolutionized the way businesses operate, offering a wide range of solutions to meet different needs.

From horizontal and vertical SaaS to enterprise and small business SaaS, each type serves a unique purpose and offers different benefits.

By understanding the various types of SaaS solutions, businesses can make more informed decisions and select the solution that best aligns with their needs, ultimately driving efficiency, productivity, and success in the digital age.

You can use this information as a roadmap to finding the right SaaS for your business. If you’d like to partner with Phase One Ventures to help you build your own SaaS platform, schedule a free discovery call with the founder himself using the link below.

Free Discovery Call → https://meet.phaseoneventures.com/jon.