One person company is a road to nowhere in the SaaS world
There is a quite appealing idea out there - you can make a great business alone. You can make lots of money alone, and yes you can do it all sitting on your favorite couch, the only things you need is a cheap laptop, internet connection, and a decent idea. Moreover you probably even know some people who did this before, and right now they are "Twitter celebrities," yeah we all know them. In fact, this kind of success is not achievable for most of the people, and one who will try and fail will make quite a lot of damage to the bunch of businesses.
There is one exciting thing about micro companies and one person companies - they tend to copy the big, well-established companies, it is easy to spot how they refer to themselves as we for example in terms and conditions or on the landing pages. All these tricks in place just to hide how small they are and build a fake trust.
I think that "organizations of one person" is not a sustainable form of a business and even harmful to the SaaS industry. If you see this other way around, let's dig into details and figure out why exactly this is how it is.
Why "One person SaaS" is the terrible thing
Switch costs in a SaaS world are tremendous
The proponents of the one man company quite often use the metaphor of the small bakery on the street corner as an example of the successful one man or family gig, but unfortunately, it is not a case with online services. Usually, web service delivers most of its value after a significant commitment from the client side, and this is true for both consumer-oriented and enterprise-oriented business.
Let me drop a few examples for you.
- Social network gives you the most after all your friends are there and you spent a lot of time browsing it already so the algorithm knows what kind of content you would definitely like.
- To squeeze maximum value from the project management software company need to migrate all project to the system and all the employees.
In both case client pay for it in some form, it could be money, time, your data, and some other resources. Now if we would look into the commitment towards the bakery is extremely small, just to say "Hi," learn the name of the owner and wish a good day.
One man companies are hazardous
There is a common term in the software industry - bus factor. In short, it a measurement that shows how many people need to leave the project to make it collapse. Probably there is no need to explain that in the case of the one man SaaS this number is ONE. Basically, whenever the founder decides to take a vacation, there will be no one who will keep the light on.
I think nobody would argue that this is not the kind of service customers are looking for.
Whenever micro-SaaS disappears the whole industry is suffering
Frustration, anger, rage just a small subset of the emotions customer feel whenever their favorite service suddenly disappear, especially if the reason for it is the boredom of the founder. There is a different kind of, but I am sure that the desire to try out a new platform build by one person will disappear.
Support is terrible or close to none existent at all
There are two main issues here. Usually, solo founders have too many things on their plate and can't catch up with customer support, or they just neglect it and remove any way to contact them.
Once in while I bought a book from this kind of business, after the purchase, I got an invoice from payment processor company with the seller contact details, and unfortunately, I had to contact the seller about my purchase. The funny thing is that the phone number is fake and web address just point to the seller twitter account. How does the customer suppose to contact the seller? Should I file a chargeback? I am not gonna do it because my issue is microscopic, but many people will do a chargeback or ask for a refund from the payment processor.
Makers should not cry in social media how is unfair payment processor and maker never wins a dispute. They don't win a dispute because there is no real way to contact them and to settle the issue peacefully.
But what should I do then if I want to start a company?
People love to see everything in black and white and making a startup is not a difference, but real life is always much more complex, and it is essential to be very pragmatic on specific topics.
The way I see to make it work consist of two phases: Start small and Make it Sustainable.
Definitely, there is no need to hire 20 people on a first day to look outstanding, finding product/market fit is often a very tedious process, nevertheless it can be done alone. It is much easier to build MVP with a co-founder because it allows you to bounce ideas and to have support when the things are going hard. When things start to take off, it is time to think about scale up the team.
Make is sustainable
After business started to generate stable revenue, I'd start to think about building a team. Team unlocks quite a lot of opportunities such an ability to take a vacation, acceptable level of customer support, and high service uptime.
I see an ideal product team in essence very similar to the NAVY seals team, people should be able to work together well and deliver a lot of value without bureaucracy in an extremely efficient manner. Every team member is specialized on some specific topic, but in essence, everyone is quite a generalist and could work on anything independently.