Recently described as “an unstoppable freight train that can only move forward”, the future of SaaS (Software as a Service) looks bright, making it an appealing option for startups deciding in which industry to hedge their bets.
Here are five reasons why SaaS might tick all your startup boxes.
1.Fastest growing software model
Growing at three times the rate of traditional software, public cloud SaaS is currently the fastest growing deployment model, and global SaaS sales are predicted to reach $106 billion by the end of 2016 (with North America accounting for more than half of the market).
2. Strong network of early adopters
One in two US SMBs currently use at least one SaaS solution. Worldwide, more small and medium businesses are adopting cloud apps, with an average of three SaaS solutions per company – a number which is expected to jump to seven next year as the decade-long decline in the use of in-house built applications continues.
Plus, a recent investment banking analysis showed that companies with SaaS software models averaged a six times revenue multiple, twice as high as the average for perpetual software companies – making the business case for switching to SaaS, stronger than ever.
3. Increase in funding
Private financing for cloud and SaaS startups has grown fourfold over the last five years, with the top 72 SaaS startups valued at over $1 billion in 2015. In Canada alone, SaaS VC funding totals $4.3 billion CDN over the last decade, and Trudeau’s government has promised to invest $600M in the Canadian innovation sector over the next three years.
4. Specialist support system
Ottawa is home to game-changing startups – including Hootsuite and Shopify – 580 software companies, 22,000 employees, and a domestic SaaS market that’s growing at a rate of 30% annually. The Canadian capital also has the second highest concentration of scientists and engineers in North America (after Silicon Valley) and corporate backing from the likes of Microsoft Bizspark, Amazon AWS and Hubspot for Startups, making it a hard ecosystem to beat when it comes to SaaS startup innovation.
5. Dedicated annual event
Presented by SaaS accelerator L-SPARK, SaaS North is the first, large-scale reunion of SaaS experts on Canadian soil, bringing together key industry players, actionable best practice, and the latest innovations for the first time. Designed to connect the top SaaS founders, investors and executives to learn, network, and grow over a two day event, this one-stop SaaS shop looks set to shape the future of the market, and establish itself as an unmissable annual event on the startup circuit.