What Is Micro SaaS?
A micro Software as a Service (SaaS) business solves one problem for a niche market. As such, the main aim of a micro SaaS is to resolve a problem with the least amount of resources.
The common characteristics of micro SaaS are the following:
- Run and created by a solo entrepreneur with the aim of providing a simple solution.
- Centered around a very specific customer audience.
- Designed to solve one problem for a particular use-case scenario.
- Does not require outside funding.
For example, Invoicy is a micro SaaS company that specializes in creating automated and customizable invoices for freelancers and small businesses.
What Is the Difference Between Micro SaaS and Conventional SaaS?
The main difference between SaaS and micro SaaS comes down to the organization size and the SaaS's range of solutions.
A micro SaaS, on the one hand, aims to provide a solution to a unique problem. Conventional SaaS, on the other hand, tends to offer many solutions for different problems.
Another difference between micro SaaS and conventional SaaS is the size of the team. Normally, micro SaaS are run by one solo entrepreneur or a very small team. Contrarily, conventional SaaS have larger management teams with more employees.
As such, the target audience size of both companies' models varies, with micro SaaS companies looking to provide a solution to a very specific group of customers. In the case of Invoicy, its main focus is to create professional invoices for its target group: freelancers.
In contrast, conventional SaaS models have a larger team with the bandwidth to provide a broader range of solutions. For example, Mailchimp is a SaaS email software and lead management provider. Mailchimp offers automated email workflows, analytics, and lead management as part of its email and lead management solution. Thanks to its broader service offering, it can help different companies depending on the pain point in their lead management.
What Are the Benefits of Running a Micro SaaS?
Speed of Product Development
Micro SaaS are characterized by their simple solution that targets a specific use case for their niche audience. As such, product development is straightforward and allows the product to quickly cater to a market need.
Micro SaaS companies can be created quickly, even if the founders aren't developers. This is thanks to the rise of APIs and SDKs that help integrate app features, without coding, from scratch.
In fact, entrepreneurs who are curious to learn what tech stack they'd need to move an idea into a micro SaaS can use Side Project Stack to understand exactly what no-code tools and APIs they can use.
The business framework and nature of the operation for micro SaaS allows solopreneurs or small teams to move fast and with complete ownership over any product decisions.
As micro SaaS don't have any responsibility to external stakeholders, solo entrepreneurs have complete control over the company's goals, brand and product vision, and ownership to direct the company's growth.
Micro SaaS companies have small teams and offer a narrow service. Consequently, the company will have very few running overhead costs, which allows for the SaaS solution to be able to function at a relatively low cost.
The freedom of low costs means micro SaaS companies benefit from low risks, with higher growth and profit margins. In fact, a study found that the average cost to develop and operate a micro SaaS is around $10,000-$15,000, while a basic SaaS can cost anywhere between $30,000-$35,000, increasing the level of risk, need for outsourced funding, and higher running costs.
Management and development of micro SaaS solutions are cloud-based, which increases the freedom for solo founders to run the company anywhere in the world.
Moreover, thanks to the cloud-based business models, small teams can be managed and deploy solutions from across the globe, which increases the freedom in management and functions.
5 Examples of Popular Micro SaaS Companies
Invoicy identified the common struggles and repetitive tasks that freelancers face constantly creating professional invoices.
Problem: Freelancers spend too much time creating invoices, and invoices need to be structured professionally with all the information required. Audience: Small businesses and freelancers Solution: Customizable and professional invoices
Invoicy works because it's able to save time and create fast invoices that are simple to use, has a customizable platform, and is targeted only to people who need to build beautiful and professional invoices.
Store Location Management
Storemapper helps businesses add their store locations to their website. This is important, as customers need to easily find the store in order to complete a purchase without any roadblocks or frustration.
Problem: Adding store locations requires coding skills most founders don't have. Audience: Small businesses with storefronts Solution: A service that embeds personalized maps featuring store locations on websites
Storemapper works because no coding is required. All a small business needs to do is simply install a package, and then it is able to customize and present the location of its storefronts on its website.
Daily Information Management
Keeping up to date with industry news and thought leadership posts from your favorite industry experts and content creators is exhausting. Mailbrew identified the need to cut through the noise and provide subscribers with only the content from their favorite influencers in a single newsletter.
Problem: People experience an inability to keep up to date with important information through social media. Audience: Anyone interested in keeping up to date with news and industry experts Solution: Create automated and personalized news threads by skimming social media
Mailbrew offers a manageable way to stay in touch with new industry reports, insights, and news from a user's favorite creators. It captures all the headlines and content from industry experts on social platforms and creates a personalized daily newsletter.
Social Proof Management
ProveSource identified the relationship between higher conversions and the use of social proof. When a potential customer adds a product to their cart or views a product page, ProveSource showcases pop-ups of positive reviews and other social proof to entice the user to make the purchase.
Problem: Businesses experience low conversions on product pages and high cart abandonment rates. Audience: Ecommerce business owners Solution: Add social proof comments and past shopping history to product feature pages and checkout
ProveSource works well because it offers ecommerce platforms the ability to gather data and send pops-ups instantly, without the need to code or develop the feature. The installation process is seamless, and the user is able to monitor the changes in conversion rates through product analytics.
One-page Website Creation
Many entrepreneurs and freelancers find the development of a website to be time consuming and complicated. Carrd facilitates the development of one-page websites with a smooth and intuitive design process.
Problem: People who need a website often lack time and experience in web design. Audience: Business owners and freelancers Solution: Intuitive, code-free, one-page website creator
Carrd helps business owners and freelancers with little to no design and coding knowledge create professional one-page websites quickly.
Frequently Asked Questions
What are the different types of micro Saas?
There are three different types of micro SaaS, depending on where the SaaS is held.
- Platform-dependent: A micro SaaS that is built to complement existing platforms and appears as an add-on or extension. For example, ProveSource, which adds social proof to already-existing ecommerce sites.
- Platform-independent: A micro SaaS that takes the form of an app for desktop, mobile, or web with its own platform. For example, Carrd, which holds its own one-page-website-building platform.
- Platform-integrated: A micro SaaS designed to integrate with other SaaS products through an API. These platform-integrated solutions are often highly customizable. For example, Mailbrew integrates with all social platforms to capture and summarize your favorite content creator news from several feeds and platforms to create a daily newsletter.
What are the limitations of micro SaaS?
Micro SaaS business models are great products that offer high-quality solutions. However, the main limitation micro SaaS companies face is related to their solution expansion. Because the very nature of micro SaaS is to provide one solution for one use case, this limits the number of solutions they can offer.
If a micro SaaS were to expand its solutions, it would then require increased investment and cost, which would inevitably change the nature of the business to a conventional SaaS.
Where should I list my micro SaaS?
Once your micro SaaS is ready for the world, there are a couple of helpful platforms to list your new offering to:
- Product Hunt is filled with early adopters and is a great platform to list your micro SaaS. Using a platform like Product Hunt will increase your visibility as well as your conversion rates, as browsers are keen to find a solution to their specific problem.
- BetaList is a helpful platform to list your micro SaaS for new products and early adopters. BetaList is also valuable as there is a large community built around sharing new products and receiving relevant feedback.