On Premise or SaaS - Challenges!

Discussions
#21

My current plans are to launch as SaaS and then offer the 'hosted elsewhere ’ option.

The hosted elsewhere option could be on premise / behind the firewall or with a hosting company of the customers choice.

I think given the nature of my app in the learning space it’ll probably be the same as the hosted elsewhere version but just on a server I manage.

That way I should be able reduce the differences. I may offer ‘modules’ that customers can purchase that will make use of things like zapier but I’m not anywhere near planning that out yet as I’m still on the market research phase.

#22

I would also like to add finance to the mix here if I may. Large corps, especially in regulated markets (electric and gas utilities and the likes…) will balk at the idea of pushing software spend to operating budgets. They prefer licenses that can be capitalized. So do large public corps…

So I guess being creative with licensing and on premise sales to the large accounts will make the accountants happy as well… One should always try to understand the finance side of one’s market, especially with corp sales…

It was a large factor for us and a few capital expenditure facilitation licensing arrangements were facilitators in many cases…

  1. make sure they can buy it for a lump sum… (they would rather make you a big cheque…)
  2. they own the perpetual right to use that version.
  3. structure maintenance properly as % of license… easy model for finance to understand.

I am always surprized how many of the large corps still prefer to buy software the old fashion way…

Example licensing deal…
Software: 100,000$
Discount on initial license: 50%
Maintenance: 10% of list price (not the discounted price… lol)

This for perpetual use of version 2.0

Upgrades will cost you XX$ …

Typically, electric utilities will run the same version of the software for 5 to 10 years… lol I know, it’s nuts but it’s good money…

So just to conclude, try to figure out your client’s financial constraints… and fit in…

My 2 cents worth…

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#23

You make a great point and one i’ve considered already.

You are 100% spot on, certainly for the big corps i’ve experience of. My On Premise / Self Hosted offerings will be annual licenses which include support and maintenance. At the moment I’m thinking i’m going out on a limb and not offering perpetual licenses but that will be decided by demand :slight_smile:

If it goes perpetual then support & maintenance contracts will more than cover things.

Another option i’m thinking through is multi year discounts e.g. 3 and 5 year license / support bundles with a slight discount as quite often ‘big corp’ will write a bigger cheque so they don’t have the renewal hassles for a few years.

thanks for the reply, a great contribution to the thread