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What is SaaS, explained by someone who makes a living from it

Administrador Building products

SaaS is software you use over the internet and pay for as a service. The definition is simple. What changes on the inside isn't.

You probably use five of them before lunch.

Gmail. Spotify. Notion. Canva. Your accountant's invoicing tool.

They're all SaaS.

What is SaaS?

SaaS stands for software as a service.

It's a program you don't install or buy once. You use it over the internet and pay for it while you use it, usually monthly or yearly.

You don't worry about servers, backups or updates. Whoever makes it handles that.

How SaaS works

  • It lives in the cloud. You use it from a browser or an app.
  • You pay by subscription. While you use it, you pay. Stop using it, stop paying.
  • It updates itself. Every customer is on the same version, always the latest.
  • It's the same for everyone. It isn't custom-built for each customer. It's configured.

That last point matters more than it seems. And it's the hardest one for anyone coming from custom client projects.

SaaS examples

The big ones: Salesforce, Slack, Zoom, Shopify.

The small ones, which are most of them: software that helps sports clubs collect fees, a booking engine for rural guesthouses, a digital menu for restaurants.

We make those three. They aren't famous. But they work exactly the same way: one product, many customers, a monthly fee.

What changes when you build SaaS

From the outside, SaaS is a program on the internet.

From the inside, it's a different way of thinking.

You stop selling projects and start keeping promises. Customers don't pay you for what you delivered once. They pay you every month for what keeps working.

You say no more often. If one customer asks for something only they need, building it makes the product more complicated for everyone else.

Support is product. Every question you get is a clue about what to improve.

Time is on your side. What you build today, you get paid for again next month.

A project is delivered once. SaaS is earned again every month.

SaaS, PaaS and IaaS: the quick difference

You'll see these a lot:

  • SaaS: you use a finished program. Gmail.
  • PaaS: you use a platform to build your own program.
  • IaaS: you rent the infrastructure (servers, storage) and build whatever you want on top.

For the end user, almost everything is SaaS.

Is it worth building one?

If you see a problem that repeats across many similar customers, yes.

If you're after quick money, no. SaaS grows slowly at first. Customer by customer. Month by month.

But what builds up, stays.

P.S. I wrote about that monthly promise in a product is a promise you keep every month.

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