5,004 reads

How I failed to validate a SaaS idea before building it (and why that’s awesome)

by Ryan J. YostDecember 5th, 2018

Too Long; Didn't Read

Like many developers, I love cranking on side projects. It’s how I taught myself to code and continues to be a ton of fun, but that passion is hurting my ability to reach my goal of bootstrapping a profitable SaaS product.

Companies Mentioned

featured image - How I failed to validate a SaaS idea before building it (and why that’s awesome)

From a developer who’s sick of building “neat” apps that don’t solve problems.

My graveyard of projects is evidence of the fact that I’m guilty of coding first and asking questions later — the infamous “built it and they will come” fallacy. And I haven’t even learned how to get people to show up once I’ve built the damn thing, so I usually just give up and move on to something else that sounds fun to build…

If I ever want to solve a legitimate problem for real people and start my own SaaS business, I have to learn how to efficiently and reliably validate or invalidate ideas before wasting months building something no one wants.

So, here’s the breakdown of my first attempt at testing the feasibility of a new SaaS idea before starting to build the first version. I go into detail in the rest of the post, but here’s the high-level overview of stuff I did that ultimately led me to NOT proceed with the idea…

Made a crappy, simple landing page with a Mailchimp email collection form
Participated on Indie Hackers forums and shared my idea for feedback
Made a slightly more legit landing page with email collection
Did a ton of Googling, forum reading, “market research”, and other internet deep diving
Chatted with a buddy about how he tackles the problem my SaaS would aim to solve
Gathered insights from a Google survey, with respondents from Reddit and a GroupMe group of friends
Used basic pay-per-click ads on Google, Facebook and Quora
Determined what I would need in terms of tech and time to build a basic version of the SaaS product. Also considered what the quickest and most doable (yet still valuable to the user) MVP would look like.
Critiqued how I would monetize my idea (B2C? B2B? Ads? Affiliates?) and if my target audience would actually pay for it.

A quick grain of salt before diving in…

I’ve never built a successful product or anything that has been used regularly by users. And all of the tactics/thinking I employed here were derived from a couple years of reading, participating in forums, etc. So, I am in no way laying out some tried-and-true way of validating, merely documenting my journey and showing what I did and learned along the way.

Here are just a few of the resources that have been great for learning more about critiquing and validating a SaaS idea.

I’ve barely started implementing what can be gleaned from these resources — but hey, gotta start somewhere!

This experiment is basically my “Hello world” for marketing and non-technical stuff.

The Idea

I used to be a financial planner, and even I struggle to manage all of the mundane, complex responsibilities that adulthood requires. Taxes, insurance, personal documents, implications of switching jobs or moving apartments, etc. — it’s a lot to keep track of and handle effectively.

I wish I had someone — something — to nudge me along, give me practical advice, send me reminders well before I need them, keep me accountable, and just generally make adulting easier. I know my friends and colleagues have the same pain points, because they know I used to work in finance and often reach out to me for basic advice/guidance.

So I thought about making an automated assistant to keep track of boring adult stuff (expiration dates, important tax deadlines, etc.) and send timely, relevant text messages with reminders, guidance, tips, resources, etc. that would make the user more responsible and help them get more stuff done with less brainpower.

Normally, I’d just start hammering out code, building the notification system, hooking up SMS, learning some AWS services, adding unnecessary features, on and on and on for months. And I’d love every minute in my cave playing with cool ideas and tackling fun technical challenges. But that just isn’t a sustainable approach to building a successful SaaS product.

Landing Page as MVP

I finally took the advice of many and built a super basic landing page to showcase the idea and collect emails.

It took me a day or two total to…

come up with a name that had an available domain name and buy it (ashby.app)
build a pure HTML/CSS landing page
set up a Mailchimp list with an intro email after signup
deploy the site to AWS, hook up SSL, etc.

Here’s that initial landing page.

I knew this first version of the landing page was pretty crappy, but it took very little time and was enough to gather some initial feedback.

I started with a quick sanity check on Indie Hackers

Rather than setting up ads or blasting the url out to my target audience of young professionals, I made a post on Indie Hackers, an awesome community of folks working to bootstrap their own products. You can see that first post here. I was super upfront about what I was doing — trying to validate an idea with a simple landing page and no product to back it up.

You can read through all of the comments, but I had the following main takeaways from this post and the awesome people who helped me flesh out the idea.

My copy was pure crap and confused the hell out of people on the value proposition. I focused on the mechanism of SMS messages, when I needed to focus on the benefit of having Ashby guide you through adulthood. That was clear by the initial commenters thinking that this was just a text message notification service. This is why I did this initial sanity check…big win and time saver here.
People wanted examples of the types of things Ashby would help you with. “Mundane responsibilities” could mean so many things….
A couple people joined the mailing list — enough to encourage me to continue the validation process.
The problem looked like a real one — that navigating mundane adult responsibilities sucks, that people want help with it and that there could be a business here.
I learned how to more effectively communicate the idea and its intended benefits. (And that the term “adulting” was confusing to some, so I should avoid using it).
Monetization options besides a subscription model would be 1) advertising based on where the user was on their journey and their location, and/or 2) using Ashby as a funnel to affiliate services which would pay me for referrals.
On the whole, that initial landing page just didn’t make the value of Ashby clear — so I would need a more fleshed out version.

Landing Page 2.0

Given the combination of negative feedback on my landing page and initial evidence that Ashby could become a worthwhile thing to build, I decided to invest some more time (maybe two days total, spread out over a week, interwoven with tons (too much) of reading about effective copy and landing page design, as well as critically thinking about the verbiage used by commenters from the Indie Hackers post) making a more legit landing page that addressed the questions and concerns I’d just learned about.

Here’s the second version of my landing page.

I also followed Buffer’s example of building a landing page that led to a frank explanation that the product wasn’t ready, and that you could give me your email to be kept in the loop about Ashby’s progress. I also provided a checklist of important documents to those who signed up as incentive. I’d made the checklist for another old project, so no extra work besides rebranding 🎉.

Clicking “Get started” led you to this page…

Getting curious eyeballs and (hopefully) signups

Now, with a more legit landing page and firmer understanding of how to present Ashby as an idea, I used a handful of simple tactics to gauge whether I was knocking on the door of a problem that needed solving.

Google Adwords

This ended up being a total dud. I struggled to pin down keywords and a product/industry that was a good fit…

It’s kind of a reminder app, and kind of a financial advice product. Nothing really fit Ashby, so my keyword suggestions felt way off the mark.
I tried using super specific stuff that a struggling young adult would search for like “renew passport”, “first apartment”, “first job”, etc. Those weren’t being searched for I guess.
The movie Ashby with Mickey Rourke was probably the reason for several clicks stemming from direct searches for “Ashby”…That was what gave me the idea for the name, so I deserve those 🤦‍♂️
Using Adwords Express didn’t help…they make it near impossible to switch to the fully-featured version. I doubt it would have helped much anyway.

Here are the final results along with some search phrases that led to views. A 1.3% click rate, with some “Ashby: the movie” noise trickled in there…

I’ll chalk this one up to a combo of inexperience with Google Adwords, a hastily thrown together ad AND a sign that Ashby may not resonate with folks the way I’d need for validation.

Facebook Ads

Another cheap, targeted, simple way to test the resonance of a product idea.

The ad…

The targeted audience…

The results…

I read that the average click-through rate of Facebook ads across all industries is 0.90%. So my 0.49% and 5 likes wasn’t dismal — but again, not what I want to see if I’m going to commit hard to building even a simple first version of Ashby.

Quora Ads

To keep the ad train rolling (because I’m an introvert and this requires no human interaction…), I thought I’d give Quora a try. I love it for learning about potential markets and gathering insights, so maybe I might like their ad opportunities, too.

The ad…

The results…

Quora Ads is pretty new it seems, so I’m not sure how to interpret a 0.27% CTR, but I’m assuming it’s nothing to celebrate. So overall, generic ads aren’t convincing me to go all-in on Ashby.

Regularly participating on Indie Hackers

I continued to participate in a regular stand-up of sorts on Indie Hackers, where I’d post my progress and a link to the Ashby landing page. I got tons of great feedback, advice and motivation there.

I also responded to another post on IH, where several folks commented on how they liked the concept of Ashby. Lots of advice and encouraging words, and an email signup or two, but I take those comments with a grain of salt, because everyone is so supportive and, while they’d tell me if my idea was crap, they also are obviously enthusiastic about tech products, which isn’t typical of most consumers.

Overall email signups and traffic

So, after using the handful of simple methods above to try and get eyeballs on the landing page and capture emails, I got 15 email signups. People seemed to want that checklist given the click rate.

And here’s how many people visited the site the whole time period of having Ashby out in the open, which was a couple weeks. I totally forgot to exclude my IP address so that session stuff is useless!

So out of 225 visitors, 15 signed up, which means my landing page had a conversion rate of 6.67%. I have no experience gauging the success of a landing page, but this article suggests that my result ain’t anything great, but not terrible either. More lukewarm results….

Google Survey

To get a feel for whether Ashby would be solving a problem that people strongly want a solution for, I made a quick Google survey without any mention of Ashby.

I posted the survey on r/SampleSize (about 30 responses) and also shared with a group of friends who would be ideal users of Ashby (about 10 responses).

I tweaked the form a bit while it was still active, adding questions that seemed helpful to test my idea, so some results have smaller response rates.

Below, you’ll see the survey results. For each survey question, I’ll break down…

Why am I asking this question?
What the results were (screenshot)
How I interpreted the result

Are you my target demo? Should I pretty much ignore your responses?

Ok sweet, most are 21–30, a.k.a. young workers who could benefit from Ashby. The 18–21 could also be helpful, because they aren’t too far off.

Again, are you my target demo? Building something that involves taxes, paperwork, etc. would be brutal to make international, so I want Amuricans.

Solid.

Folks with ADD/ADHD feel the pain of not being organized and on top of their responsibilities more than others. So this could be an interesting niche.

Ok ok, when I export to Excel I’ll see if there’s any meaningful difference in responses from folks that responded “Yes” or “Maybe”.

I was considering an integration with Google Drive and Dropbox, which would involve a web app that provides an interactive checklist of important documents.

Eh, ok this isn’t looking like a promising option. I considered it for an MVP, because it’d be easiest to build, but just doesn’t seem compelling. I could interpret this as folks being disorganized and not saving copies of docs securely in the cloud, and they would if they had something like Ashby, but gonna assume they just get by doing the bare minimum and don’t worry about it.

If people feel confident about handling the stuff Ashby would help them with, then they won’t feel a strong enough pain to buy it.

Geez, so a minority lack confidence. Doesn’t mean a market doesn’t exist, just that it’s smaller than I hoped. Maybe they’re lying….

If they don’t think that what Ashby helps with is important, they won’t use it or pay for it.

Alright, that’s a great response there. So folks really want to be responsible adults, which Ashby would make more attainable with less effort.

Ashby is intended to be an assistant, so all it would do is help “navigating adulthood and keeping track of your mundane adult responsibilities”. So if folks don’t need help, then they don’t need Ashby.

Mmmm, that’s a lukewarm response in my eyes. I was hoping to see people begging for help…

Then I asked “Why?” to the previous question, just to see what would happen. Here are some responses…

I’m lazy and forgetful

I neglect stuff sometimes

I have ADHD.

I wish I understood how taxes work and that everything was easier to do online.

Because they’re mundane, I sometimes don’t think to do them but otherwise, I’m pretty on top of things

Because I never learned how to do it

I always feel like I could be better on top of things, but also I have anxiety so

I’ve got it more or less down

Because otherwise I forget and I’ll be in trouble

Because I’m not a fucking moron.

I hate adulting and procrastinate doing taxes for example

I have adhd which can make it hard to focus on or remember my responsibilities

I pretty much have all my stuff sorted

I’m still a child at heart

I am not a calendar.

nobody taught me how to do this shit

I procrastinate and can be forgetful

Time. Don’t always have enough time to research.

Cause I’m lazy

Those responses are nothing surprising. I feel that it’s probably all true, but my form led them to that final “why” so may have been a bit distorting.

I did a basic breakdown in Excel as well, just to see how the folks in my target age range or those with ADD/ADHD responded, and it was pretty much how the results broke down above, so no need to dive into that.

Considering the time/effort/tech needed to build a first version of Ashby

To make an absolutely basic version/MVP of Ashby, one that was purely through SMS like the landing page screenshots illustrate, I’d need to…

Get set up with an SMS provider like AWS or Twilio. Given the other services I could leverage on the AWS platform, I’d lean towards that. I have basic experience with AWS, but there’d be a decent learning curve here. Also, SMS ain’t cheap. Email and push notifications are also an option, but not as effective or compelling in my opinion.
In order for Ashby to respond to user text messages, I’d need some sort of machine learning or smart chatbot functionality. Bare-minimum would be a mess of if/else statements. I could probably get away with some bad UX here in an MVP, but seems like a bottomless pit of new learning (which my brain can’t resist) and issues for a first-timer trying to ship something ASAP.
Build a scheduled notification system, that has both pre-set “paths” and the ability to take user input to schedule reminders. I’ve never done anything like that before, so more uncertainty regarding how much time/effort I’d need to ship an MVP.
I’m a front-end developer primarily, and have a solid chunk of back-end experience. But this MVP is looking like 100% backend, dealing with things like phone numbers, authorization, SMS, queues, cron jobs, etc. So inevitably, I’d have to learn a decent bit in order to build the MVP.
While a super bare-bones MVP could be entirely through SMS, I struggled to envision how a web app of some kind to manage one’s account wouldn’t be needed.

So overall, building something that’s both minimal and actually valuable to early users is looking like more than a couple weeks. Maybe I’d be OK dedicating a month to an MVP, but that’s longer than ideal — especially with the new mindset of coding less while trying to create a software product.

I thought about monetization options

This is obviously a consumer product, which already makes marketing and monetization way more difficult as a bootstrapper. I have no intention of raising money, so I’d need to get creative to make money on a B2C product.

I did some thinking about how Ashby could add value to businesses, just to see if there was a way to avoid it being strictly B2C. I had a couple ideas…

College career centers or alumni associations — Maybe colleges could offer it to their recent or soon-to-be graduates. I emailed my own college career center and alumni association about whether they help grads with this sort of stuff, and they focused exclusively on career/job/networking. So it doesn’t seem like they’d have any incentive to pay for Ashby and distribute it to their cohorts. Maybe I could have these organizations give away a free couple months, but having free users would require some funding.
Companies for their young employees — There are tons of options that are similar, so definitely a demand. Lots of options also cover WAY more stuff than Ashby would (401k integration, HR, etc.), so I could target smaller companies that just want to provide something of value to their new/young employees.
Financial advisors, for their clients’ kids — While I definitely have a ton of experience in that space, and know that helping the kids of clients is something advisors work on and care about, I know that it would be an impersonal solution, which isn’t too attractive to clients who pay good money for the time and service of a team of capable people. Not a ridiculous B2B option, but my own gut check isn’t getting a passing grade.

Ok, so B2B doesn’t have a super clear path to success. Feels like I’m forcing my idea into a market, rather than creating a solution for a market with a problem.

Maybe I could niche it down to a small subset of consumers, like young professionals with ADD/ADHD, tech people, etc. Even still, the idea of Ashby is super generic by definition, in helping with life’s most common and mundane tasks, so I may have shot myself in the foot there.

In terms of actual monetization structures, there were a few options…

Monthly Subscription — definitely my favorite option. But young people expect everything to be free, have tons of free services to choose from and are unlikely to open their wallets for this on a monthly basis. Parent’s might be willing to pay for their kid to have Ashby, and definitely have the money to do so.
Advertising — would require tons of users using Ashby for free, which of course would mean me supporting the costs to get to a level that advertising would be valuable to companies. Or outside funding, which isn’t something I personally have any interest in.
Affiliates — an Indie Hacker gave me this idea, where I could funnel Ashby users to 3rd party service providers (insurance, investing, tax, etc.) and get paid a referral fee. I know the kinds of things I like to do, and organizing an affiliate network is NOT something I want to do. My goal is to build a SaaS, but it’s gotta be something I’d enjoy working on.

When all’s said and done with these thought exercises, my attempts at finding a viable, small initial target market feel forced and not compelling.

Ultimately, the reasons I won’t be pursuing Ashby

It’s a B2C product, with young professionals as the target demo. Very unlikely to open wallets in any meaningful way.
I personally don’t want to deal with advertising or affiliates.
My research with surveys, ads, convos, Googling, etc. don’t suggest that people care enough about the problem Ashby would be solving. People just get by dealing with mundane adult stuff.
I failed to nail down a viable B2B path or value proposition that seemed attainable.
The value is in a smart, automated notification system that can also take in information, which is a new technical challenge for me and would take a while to build. I can’t envision a simple MVP that took minimal time on my part to add any real value to early adopters. Trying to avoid going into my coding cave from now on.
Generally, I’m getting the vibe that B2B is the move, so think that’s a more realistic path to becoming a bootstrapper.
I’m not passionate enough about this area to overcome all these obstacles. I left the finance world for a reason….

Takeaways for next time I want to test a new idea

Talk to more people in person
Go for B2B — it just seems more doable given willingness to pay and the consensus I get from SaaS and bootstrapping people
Get better at positioning and cost-per-click ads
Don’t forget to exclude myself from Google Analytics….
Pick a space that I’m passionate about, not just one I’m confident in being able to handle.