How to make a SaaS application?

How to make a SaaS application

Hind Chtibia

Business Analyst

9 October 2023

How to make a SaaS application? SaaS, or Software-as-a-Service, has garnered widespread acclaim as a highly convenient software delivery model for software due to its convenience. Cloud-based business applications can be accessed via web browser without the need for installation or strict contracts, which is a huge benefit for many.  With the option to pay over time rather than all upfront, SaaS applications are flexible and affordable for any budget.

SaaS is a versatile solution that can be applied to any industry or operation, including e-commerce, enterprise relationship management, customer relationship management, healthcare, project management, and HR. Its adaptability makes it a great solution for providers and users alike. This guide will outline all the necessities to learn how to make a SaaS application.

SaaS application

What is a SaaS application?

Software-as-a-service (SaaS) is a sales model that has increasingly replaced the classic software license.

SaaS products are accessed online and available to all users.

For example, popular SaaS companies include Dropbox and Google Apps. Users can use SaaS platforms without installing any software on their devices because the application is hosted on a server. Upgrades and ongoing maintenance are handled by the host side and are invisible to the user. SaaS products are distributed via a subscription model, rather than a lifetime license.

Advantages of SaaS

The main advantage of SaaS solutions is that special equipment is not required. Cloud-based web applications offer:

Security – Your data is securely backed up.

Scalability– Upgrades or downgrades can be easily implemented as needed.

Reliability – Servers can be placed anywhere in the world, so if one goes down, the rest will keep working.

Regular revenue for developers.

Lower costs – SaaS reduces development costs as there is no need to purchase or maintain costly hardware.

Potentially wider customer base due to reduced costs and trial phases.

Accessibility – The solution is available online at all times and only requires an internet connection.

Types of SaaS applications

There are numerous cloud-based application options available. Some popular software options for businesses include the following: 

eCommerce software, such as BigCommerce or Shopify, assists with running an online business, including product management and payment integration.

Vertical SaaS, which offers niche-specific products for optimizing business processes.

Collaboration software, such as Miro, helps with communication and information sharing.

CRM (Customer Relationship Management software), like HubSpot, automates sales and marketing processes.

ERP software, such as Oracle, manages business processes.

Project management software, like Jira or Workflow, assists project managers in collaborating with their teams.

Payment software like Tipalti streamlines and simplifies payment procedures with just one click.

SaaS application development team composition

To build cloud-based SaaS software, we require specific job roles. Here is the makeup of the SaaS development team.

The Project Manager:

This person is responsible for planning the software development process, assigning tasks to team members, and tracking their progress. The Product Manager ensures that the progress meets the set timeframe and requirements.

Business Analyst: 

A person who analyzes the company’s data and determines the requirements for the software to meet the business specifications. This role includes analyzing the software’s market position, documenting progress, and creating a successful business model for the client/company.

As a UI/UX Designer:

a key responsibility will be designing and implementing the application’s interface and user experience.

Backend Developer:

A person responsible for managing tasks on the server side of a SaaS application, ensuring its proper functioning with scripting languages. Ensures that all aspects of the software development cycle are tested, analyzed, and improved to guarantee high quality and flawless functionality.

Frondend Development Personal:

This role is responsible for translating designs into code using JavaScript or another language to provide the framework for client-facing operations.

Quality Assurance Manager:

This role entails testing SaaS software for defects, bugs, and issues and subsequently reporting them to the team for resolution.

The composition of team members can fluctuate depending on the magnitude of the project and the financial resources allocated for its development. It may be necessary to engage additional experts or technical staff. Furthermore, if the project is inclined toward adopting the DevOps methodology for Software as a Service (SaaS) projects, the inclusion of a DevOps engineer becomes imperative. Altcode offers a team of exceptionally skilled and seasoned professionals who possess the requisite expertise to fulfill the project requirements.

SaaS product development process: How to make a SaaS application from scratch

The answer to the question of how to make a SaaS application is to follow these steps:

Market analysis – validate your idea:

The long-term success of your product is dependent on good market research, which gives you an insight into your competitors and the demands of your potential clients, allowing you to validate your idea. This also helps you avoid repeating the mistakes of those who have failed. Through comprehensive research, you can determine whether customers are willing to pay for your product and ensure that your offer meets their needs. Ensure your business model offers clear and recurring benefits and appeals to a broad audience.

Market analysis - validate your idea

Discuss the requirements for SaaS solutions:

Share commonalities, making a well-defined strategy for customization, integration, and security indispensable. In a SaaS model, the foundation of a good solution is maximum security. You must be able to adapt to constantly evolving customer requirements. Your software should be designed to handle a growing number of users without slowing down.

The SaaS product MVP:

Having a minimum viable product involves identifying the fundamental features that provide value to your customers at minimal cost to your business.  The MVP will be tested by early adopters and developed into the final product.

One way to define a minimum viable product is by answering questions about your user persona, the actions users take to solve their problems, and the proposed solutions.

Choose your pricing model: 

Additionally, selecting the pricing model is crucial, as various models for SaaS solutions significantly impact the product’s popularity. The pricing strategy should align with the targeted users’s needs, including usage-based pricing, where users pay based on the amount of usage. Feature-based pricing refers to offering different feature sets at different prices. Freemium refers to a free version with limited features that can be upgraded. Active user pricing charges per user for the entire product, while under flat rate pricing, the entire product or bundle of features is offered for one monthly or yearly price.SaaS products often feature an initial low cost, free trial, or promotional pricing.  

Technical aspects:

This is the stage where you must decide on the architecture of your SaaS solution. Consulting with professionals is advisable to determine the necessary programming language, tools, and platforms for SaaS product creation. It is crucial to consider the long-term product as well as the MVP.

Find and Create a Development Team:

Now is the perfect time to assemble or establish a team of developers who will manage all aspects of the SaaS development process. You can choose to form a team with internal employees, provided you have the necessary resources, or outsource the development work partially or fully. Outsourcing to an established team can provide numerous benefits and allow you to concentrate on business operations such as marketing. 

Calculate your budget:

By this point, you should have an idea of the cost of developing your SaaS application. Consider the time required to create your product and the selling time. Plan your budget carefully, remembering potential changes and delays. It is advisable to prepare for the worst outcome and be pleasantly surprised rather than the opposite.

How to convert an existing application to a SaaS model

To convert your application into a SaaS business, follow four main steps.


First, analyze your application’s potential in comparison to existing solutions on the market. Review features and integrations Consider whether to introduce a new feature model or eliminate elements of the existing one. and envision the conversion process as revitalizing your product as a cloud SaaS.

Assemble a team

Second, establish a team capable of handling the changes in maintaining and supporting the product that will come with converting to a SaaS platform. Also, consider offering external support and outsourcing SaaS application development if necessary.

Assemble a team

Select a cloud provider

Third, choosing a Cloud Provider. One critical aspect of developing SaaS applications is hosting, which distinguishes it from traditional software development. If your product will be available online, it must be hosted in a cloud environment. Compare several providers and pay close attention to their team experience, number of users, and customer service.


And so forth, migrating to the cloud may take some time, depending on the complexity of your product, your team’s expertise, and necessary integrations. Hiring SaaS software development experts can shorten the development time.

In brief, it is important to keep in mind that in some situations, it may be necessary to transfer the project to a new technology or rewrite the backend/frontend. Therefore, be sure to take this into account when estimating timelines.

For instance, Adobe provides an example of a successful conversion from on-premise software to a SaaS business model. However, now, there is a monthly subscription plan that provides access to other Adobe products, with a smaller fee than the cost of the physical program. In the past, a physical version of Photoshop could be purchased. This plan allows for updates and a trial period with no binding contracts.

What are the key SaaS metrics you should be tracking?

As a business owner, you obviously want to learn how your business is performing. Many metrics can tell you how your product is doing. While using tools like Google Analytics or Hotjar is helpful, it is not always enough.

Most SaaS companies focus on KPIs – Key Performance Indicators such as:

  • Monthly or annual revenue.
  • CAC (cost of acquiring a customer).
  • LTV (Customer Lifetime Value), reflects the revenue earned by a customer throughout the lifetime of their subscription.
  • NPS (Net Promoter Score) – the benefits customers derive from your product.
  • Customer churn – the percentage of customers who unsubscribe monthly.

When analyzing your metrics, keep in mind the distinction between low-touch and high-touch SaaS. For low-touch products, the software allows subscriptions through the website, emails, etc., with minimal interaction from the sales team. With high-touch products, the sales team is deeply involved in processes such as customer acquisition, onboarding, and maintenance.


Although it may not be right for every business case, the creation of a cloud-based SaaS application is gaining popularity due to its various benefits. Many large companies, such as Adobe Photoshop and Microsoft Word, have moved to this distribution model. It’s worth noting that some popular applications like Spotify, Slack, and Grammarly were initially built as SaaS apps.

Whether you are contemplating transitioning to SaaS or developing a new SaaS product and need to outsource the Saas project development, the team at Altcode can assist you. Our team of engineers will assume responsibility for the entire process, affording you the opportunity to allocate time and resources to other business processes.

Contact Altcode for more information.

Hind Chtibia

Business Analyst

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