Business & Finance

How To Generate and Validate Your SaaS Idea: A Step-by-Step Guide

How To Generate and Validate Your SaaS Idea - A Step-by-Step Guide

The business needs a great vision and uses the power of hustle to validate the SaaS idea.

Photo: Canva

Building a SaaS business will require lots of planning and dedication. But, before investing time, energy, and money in setting up, it is essential to spend significant days searching how a SaaS idea can turn into a successful SaaS Company.

The business needs a great vision and uses the power of hustle to validate the SaaS idea. But, now the question is how is an individual doing that? In this blog, there is a step–by–step guide on how to generate and validate your SaaS idea. By going through these steps, discover your visions and whether they have real potential.

The Process of Generating and Validating SaaS Idea

Building any business requires hard work, and the risk of wasting years on something that plan out will be a daunting task. The key to avoiding this problem is to prepare a complete proof plan. Similarly, there are many ways to generate and validate SaaS ideas in the SaaS business, from brainstorming to prototyping.

1. Identify Target Market

The first step is to discover what the potential customer can be for your business. However, SaaS businesses usually serve one or more of the following broad segments:

  • Startups: Startups looking for rapid growth and expansion.
  • Small Business: Business with less than 100 employees
  • Enterprise Business: Business with more than 100 employees
  • Customers: Users who are looking for services.

SaaS development tends to work with these broad categories; the company can use specific niches like demographics, interests, preferences, etc.

See Also: SaaS Industry Trends and Future of SaaS

2. Brainstorm the List of Problems

After segmenting the target market, prepare a list of potential problems or challenges the business might face. So, think about the following points:

  • What are the long–term goals?
  • What is the daily challenges business might face?
  • What are the common pain points and frustrations the target market experiences?
  • What task is time–consuming or tedious?

Here is a cheat sheet to kick off brainstorming based on top-level market segments. Some of the common problems small business face includes the following:

  • Marketing
  • Account and bookkeeping
  • Inventory management
  • Human Resources
  • Customer relationship management

Common challenges startup businesses may face:

  • Financing
  • Quick growth and scaling
  • Customer acquisition
  • Quick growth and scaling

Common challenges enterprise business may face:

  • Compliance
  • Data management and storage
  • Workflow efficiency
  • Integration
  • Security

Common challenges customer businesses may face:

  • Health and Fitness
  • Organization and time management
  • Productivity

Related: 5 Most Successful SaaS Pricing Models (Examples and Strategies Included)

3. Develop Ideas for Solutions

When you generate SaaS ideas, it is crucial to remember that SaaS solutions are usually ones that are:

  • Scalable: The idea should be Scalable up and down to fulfill customers’ specific needs.
  • Simple: The idea should quickly resolve customers’ problems without bells and whistles.
  • Flexible: It is customized to meet the particular needs of different customers.

4. Evaluate Ideas

While considering which trends to capitalize on, it is essential to consider whether there is a large enough market for the idea. However, the middle step between coming up with ideas and validating ideas is necessary. Validation requires a short but notable amount of investment and time, so the business will only be able to validate some ideas.

This process further helps narrow the list of ideas down to the ultimate winner without depending too much on sheer intuition. The concept enables quickly shortlisting a more formal validation process. While evaluating ideas, there are some crucial factors to remember:

  • Is a large market or opportunities available for this?
  • Is the problem really that people are willing to pay to have solved?
  • Is the idea feasible to pursue?

One of the fruitful approaches to guide the decision is to use keyword research tools and determine how many people are searching for the identical related to the idea. This will give an idea of how many people are looking for solutions in a given way that is quick and rough. If the search volume of a keyword is less, then there is no market for this.

Also Read: Top SaaS Tools List for Startups

The Process of Validating SaaS Ideas

To helps business in evaluating ideas, here is a simple structure that leader can use. However, this structure is based on a startup policy about validating SaaS business ideas quickly and efficiently.

The process is as follows:

  • Realize there is an issue to solve and have demand in the market. You can identify this issue by conducting research and talking with customers.
  • After identifying the demand, the next step is to build the idea. In this step, you need to do some feasibility research and evaluate if there is a possibility to create a solution that meets customers’ needs.
  • After that, validate your solution to solve the problem. As to the customer personally and observe:
    • What are the long-term goals?
    • What process do customers feel is tedious to do?
    • What are the common pitfalls and frustrations?

After validating your market idea, the next step is to validate the business model and go to market and growth strategies.

Also, there are a few things that the business can do to analyze:

  • Create a Landing Page: It is an excellent way to validate SaaS ideas quickly. The owner is to create a simple landing page with an email and contact number sign-up form. Social media campaigns allow businesses to get traffic to the landing page.
  • Conduct Customer Reviews: The most popular way to approach customers regarding business launches. It allows them to get customer feedback and evaluate how people will respond. If the response is positive, the chances of a growing business are 100%.
  • Launch Minimum Viable Product: Before launching the final product, it is essential to establish its prototype and evaluate how much people like it. If the customer is engaged in it, then it is helpful for the business to go with a viable model.
  • Run Paid Campaign: It is an approach to attract and inform the target market about the product. It is the right time to go with the proposed model if businesses get sufficient leads or reach.

After going through the entire process, it is an excellent idea to analyze whether the SaaS idea is valid. If businesses can validate demand and feasibility, then there is a good chance of success.

See Also: SWOT Analysis for Software (SaaS) Development Company


Validating, building, and marketing SaaS products is not faint of heart. So, if any of the organizations are interested in starting a SaaS business, it is imperative to do in-depth research and validate the idea before investing time, money, and effort.

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