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How to cut expenditures in your SaaS business?


Managing the finances in any SaaS startup is important, if you are spending more than what you are earning,


and you don’t have any plans on how to control it, your SaaS won’t be able to last long. Thus in this article, we will be looking into what places we can save money, and what practice we can apply to lower the spending.


But before we start, I have written a book on marketing if you want to take a deep dive into marketing and know how to get long-term paying customers for your SaaS, Marketing Strategies to Grow Your SaaS which will cover all the necessary steps and strategies in depth to help you take your SaaS from scratch and get some real paying users.


I’ve seen a lot of people who have a successful SaaS running in the market, but after some time they need to remove people, do some server downgrading, or even change their pricing model of the SaaS.

This affects the ongoing business as sometimes users are not happy with the change, server migrations can introduce some bugs in the system, manage the work with limited resources, and so on. So let’s understand places where you can take considerations and how you can lower your spending.


Poor Hiring & Firing🧑‍💻


I’ve seen a lot of startups hiring people even for the work they don’t need. In SaaS startups, a person needs to be multi-tasking to handle multiple works if needed. Founders hire people like assistants, secretaries, lawyers, or even unnecessary managers.

Even sometimes hiring developers from platforms like Upwork demands rates that are far too high, thus at that time, you need to be careful or take someone's advice in selecting the right people.


Another mistake that I see, is not firing the wrong persons at the right time. It happens for sure some people contribute far less than what they are charging you, in these cases, you must be sure to remove such people from your team at the moment.

To find such people you need to make sure to place the right KPIs/monitoring and consult with your senior developers/CTO about the performance of the newcomers in the time of 1 week to make the right decision.


Don’t share your card 💳


A lot of times what happens is your team needs some subscription to any tool or design resource, to do so founders often share the card with the CTO or the senior dev for him to make the payment.

This is the wrong thing to do, I understand you won’t be able to provide the card whenever it’s needed maybe you are busy or not available. But in startups try to have the payment control in your hand only, or if it’s not possible make sure to check where your card is added and audit why it is needed with your CTO by the end of the month so you can take steps to remove any unwanted things.

If you don’t keep track of these things your team will add your card wherever they need and sometimes there are free resources available that you can use to make things happen.


Audit the 3rd party resources being used 🔑


Your team will often try to find shortcuts, they will try to use third-party APIs or design resources which sometimes can also be done by simply using free resources or coding.

You need to clearly understand what resources you are paying and what value are those adding to your SaaS. If you feel there is not much added value you must remove such subscriptions immediately.

Also, make sure to rotate API keys every 1 week or at least 2 weeks if your team is using any expensive 3rd party provider like an AI service.


Save costs on Cloud Infrastructure ☁️


I encourage all my clients to participate in Cloud Startups programs where you will get credits from them to use. Cloud providers like AWS, Azure, and Google Cloud Platform run these programs and provide up to $100,000 of credits to use.

In this way, for starters, you don’t have to pay money from your pocket and use the credits added to your cloud console.


Here is the list of the programs you can apply to,


You can apply for them to get the credits for your startups and build your SaaS on it.


Also be careful while using platforms like Vercel, Heroku, or Render these are good platforms for starters, easy to set up, and have all things made in UI. But for the long run, you should try using cloud platforms like AWS, Azure, or GCP.


Make sure of these things that I’ve told above and you should be all set for running an efficient SaaS application. Let me know in the comments if I’ve missed anything I would love to have a look into it :).


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