SAAS basics | Navdeep Yadav | Skillshare
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4 Lessons (31m) View My Notes
    • 1. Chapter 1 SAAS IAAS PAAS

      9:37
    • 2. Chapter 2 Why SAAS is so special

      4:26
    • 3. Chapter 3 what us univerisity management software

      5:44
    • 4. Chapter 4 SAAS unit economics

      10:56

About This Class

This class will give you the fair about the IAAS,PAAS and SAAS which approximate for 24% of all enterprise workloads where IaaS is hovering around 12%

PaaS is currently the most popular model, hovering around 32%.

IAAS ay-as-you-go storage, networking, and virtualization which cloud-based alternatives to on-premise infrastructure, so businesses can avoid investing in expensive on-site resources.-Amazon Elastic Compute Cloud (Amazon EC2) is a web service that provides secure, resizable compute capacity in the cloud.

PAAS :- A PaaS vendor provides hardware and software tools over the internet, and people use these tools to develop applications. PaaS users tend to be developers to create unique applications without spending a fortune or taking on all the responsibility and goes into creating, testing, and deploying the app.

SAAS platforms make software available to users over the internet, usually for a monthly subscription fee. With SaaS, you don’t need to install and run software applications on your computer (or any computer).

Backend-as-a-Service (BaaS) is a cloud service model in which developers outsource all the behind-the-scenes aspects of a web or mobile application so that they only have to write and maintain the frontend like firebase, mongo dB etc.

BaaS uses unified APIs and SDKs to connect mobile applications to backend cloud storage, whereas legacy mobile middleware uses local physical services to integrate backend services. The biggest difference between middleware and BaaS is the inclusion of cloud services. In this manner, BaaS is an expansion of PaaS in the mobile vertical field, or better yet, the combination of mobile middleware and the cloud.

Transcripts

1. Chapter 1 SAAS IAAS PAAS: Hello everyone, welcome to the third section of MBA Marketing inside module. And in this module we will try to understand what are the different types of data and how exactly that recommendation engine really walks. So in the last few videos we had through discussion on these three product, but we forgot to cover one important product that is university management software. And this section will try to understand how exactly we can a university management software, how we can create different marketing and business strategy, and how exactly the finance, or so-called the unit economics of this SaaS-based product is going to look like. But before that, actually jumping into the very small metrics of this university management software that we have to understand that what are the different types of service provide in terms of technology? So basically we have four different types of technical service. We have IES v, how fast we have bass and we have SAS. Our university management software lies in the category of SAS. But to understand says we have to understand other three category which is IES, bass and best. But before jumping directly into these four different categories, we have to understand how exactly a company really build infrastructure off the technology. Now in on-premises infrastructure, ego company basically maintains and build the hardware and the software side of the technology. And this is really complicated. Now if you really want to build our own premise infrastructure, then it is very expensive. And it is very complicated because you need to vary the whole infrastructure from networking applications. Let me start from the bottom. First, we haven't cloaking problem. So you need to purchase those networking equipments from Huawei, from LTE. Once you have purchased all those networking equipments, then you need to purchase some storage devices from Samsung or from placebo. Then you need to integrate those storage devices and those networking devices or hardware into a solver and then to configure that. So all you have to build some sort of OS which basically can interact or so-called up Lincoln downlink the data packets from solver to your software. Then you need to create some middleware and runtime, which basically gives you an idea of whether your or integration of storage and networking is working properly or not. And then you need to build an application on the top of their OS. Basically provide you different functionality and flexibility to those over. Now to build this on-premises infrastructure, you need a lot of space, a lot of engineers, and a lot of capital to basically maintain and run these kind of solar. Now this is not possible for every single companies, like some MNCs might or do that kind of stuff. But if you are a small start-up or if you're a small company, you might not have that much amount of resources to build goes loud infrastructure from the scratch. And that's why these different tree kind of platform comes into the picture. That is IES bass, bass and says, Now if you look at the on-premise standard scenario in that situation, in IES. You already have networking, storage and virtualization. Now, if you put the standard on-premise infrastructure input, then you already have networking storage. So war and virtualization in IES, This is already built by different companies. You just need to install your own OS, your own middleware. You just need to test out different runtimes. You just need to store some data in the backend and then you can easily run the application. And if I take an example of IES kind of service, basically Amazon, EC2 and Digital Ocean are two different companies. So if you look at examples like Amazon EC2, and visit an ocean, all these company basically provide you a private or Solver, which you can install your own OS. You can store your data and basically you can draw new application. Now, IES still requires a lot of engineers to basically install the custom OS. Then you need to take sphere of runtime and middleware. Then you need to store different types of data in different location and then you need to run the application, but still it is customizable up to 50%. And the basically the hardware part is taken care of by different companies like AWS and Digital Ocean. And basically if you use IAAS, then you end up avoiding investment in expensive ONE site resources. And basically Amazon or web server or one of the perimeter of Amazon website orbits is Amazon Elastic Compute, which is EC2, is a web service provider which basically provide to us secure, resizable, and compute capacity in the cloud. And the similar thing goes with the digital ocean as when. Now let's discuss about the past. If you put the on-premise or standard of stages in the past platform, then you already have networking storage. So for virtualization OS middleware, runtime, you basically needs to put your data and you basically needs to run your application. Or you basically build and deploy these applications on these different paths platform. And basically people can use these type of tools to develop application. And these provide unique or application or platform and basically all different kinds of responsibility like creating our application, testing it, and deploying the app on the cloud. So passes very important, but it still requires some sort of engineering to put that data to test them, to deploy these kinds of application. So if I take an example, Salesforce and Heroku or two of the example of past. So basically in sales for you can create, test, and deploy your application. And similar thing goes with Heroku is when these two are the example of pass. And now we will discuss about bass, which is a backend as a service. So bass is basically a cloud service model in which developers out shorts all the backend service aspect. So for example, if you are building a mobile app, then you only needs to take care of different ad platform like Firebase, MongoDB and sky gear. All these flat formula takes care of your backend. So you just need to take care of your front end using different language or, or so-called frameworks like React and platform like Firebase and sky gear will take care of your best. Now five versus developed by Google and Skype. And I'm not very short, it's a independent companies, I guess. And so all these are the example of best and bass is basically a unified API and SDK. Which basically helps you at mobile application to connect the backend to the different cloud storage devices. So basically, if you're using Firebase and Google Cloud, it is a deadly combination. So bass is basically a mobile vertical expansion of paths. So if you're building any mobile lab, you do not need to take care of backend. Firebase will take care of backend and you just need to build your front-end of the app. And Beth is very helpful for those people who especially building anymore why lab. So it's very important if you're quickly trying to bubble up anymore wide application. Now then comes the SAS, which is most famous. And a lot of investors are taking in Preston SAS based product. Now Sas have everything starting from me talking to the application sands, we provide each and everything to different businesses. If I take an example of platform like Zen desk, male chimp slag or fresh desk Joe who all these are the example of SAS. So imagine you are a startup owner and if a customer throw away any complaint in front of you, no matter through e-mail, through a message or a phone call, or through any medium, you can basically create a unified ticket. And then the ticket will be resolved by different people at different stages. And I have seen a lot of companies using these two different platform like Zen desk and thrusters for the ticketing and customer support. We also have male chimp, which is basically an email marketing tool. So in mainstream, you can customize the email. You can design those beautiful templates which you usually see in your mailbox. For example, tomorrow if you open your promotional mailbox in your Gmail, you'll find those beautiful design templates of the email from different companies like Amazon or maybe from clip guide. All those beautiful templates of those different products are designed using tools like male chimp. And we also have some email marketing tools from Send grid or from Amazon, or from our sales force. So all these different kinds of meal which I'll personalized based on the customer, are done using Mail Chimp. So basically if you have different data points for the customer, for example, you know the name of the customer, the interest of the customer, and the product which that customer have a scroll in last couple of weeks. So basically you can drop a meal highlighting the name of the customer at the top. So you can choose the interest of the customer and then you can put all dot product in that interest category into the middle. And basically you can drop me and that is very personalized towards a specific customer. So those kind of different strategy can be done using male chimp. And there are multiple more features which are there in Michigan you can try out on basically will have some tutorials and mint chip. If you've got something, then you have Slack. And slack is basically our internal team communication software. And I guess a lot of you already know about slept, so there's nothing more to discuss. But this is also a kind of a SAS based product which gives you a reoccurring revenue every single month. And there are two very specific terms to that, that is MRR and ARR. So MRR is basically the monthly recurring revenue and ARR is basically the envelope reoccurring revenue. So if you are subscribing to assess this product every single month or every single year than how your churn rate and how MRR a add-on metrics are going to look like. We will discuss about all those things in the unit economics chapter. But I'm just trying to give you a perspective that how did SAS based product are really working in the market? 2. Chapter 2 Why SAAS is so special: And very beautiful thing about SAS is, says we'll have high upscale potential, high scalability, and they have high margins. Which means that if tomorrow we will assess this product, no matter you settle back, SAS mispredict propene companies, a 100 companies or 1 million companies. Your marginal cost will be very less because you just need to increase the bandwidth and the scalability capacity. So if you are selling it to a 100 customer, you will generate a $100 if you are selling it to 1 million customers and make $1 million. If the unit price of the product is $1, and that's the tuition. You'll really need a little higher bandwidth, which means says have a very less marginal cost and they have very high margins. So if you build any SAS mispredict, you can easily on 70-80 percent of the margin from that testers product. And you basically needs to sell that product as much as you can. If your product is really good, your margins are like 60, 70%. So if you acquire 1 million customer, your margins are like 60, 70% of those 1 million customer now grab three beautiful things about SAS foster one is this scalability. So if you have any sense based product from any corner of this word and your product is very perfect. You basically can sell you a product to any part of this world. The second thing is the upscale potential. So if you have built down one sadness for it, you basically can abstract or down stretch your portfolio and you can also vary the related product. And then you can integrate all of those related product and you can sell all those products together. And the best example is the front desk. So if you look at the different product of rest walk, that is fresh desk press call fresh jet. Those different products are basically communicating with each other just like the Apple ecosystem. And that's why there are highs upscale potential. There is high scalability and the best part about SAS vis product is margins. So basically, for example, tomorrow, if you have big agendas by putting 1 million Nolan and go product is very good and it's very ready. And that situation, you can onboard many and many costumers and basically you can generate more and more amount of revenue. So the marginal cost of acquiring a new customer in SAS product is very, very less. Just to give you a perspective. For example, tomorrow if you have built up black film like Jim does, and you're selling this plaque forming $10 per month. So if you acquire one customer, you will earn $10. If you're going to go out 1 million customer and the new $10 million product development cost will remain same. So the marginal cost of acquiring a new customer is very less. You just need to increase your bandwidth bill with the help of this cloud service provider. And you can only much more than the normal product or the normal e-commerce platform. So science-based work have high yup skin potential, high scalability, and high margins. If you look at the company side of building this hazardous product, there are multiple advantages, but we have two different categories of sets. We have horizontal size and we have vertical says. So you can literally use Darwin books and threats desk independent of your company vertical. I read books is at Chiron platform, which basically manage your on-boarding training or your recruitment kind of stuff. And fest decimals are ticketing platform. It is one of the commutator of gen desk. So these are the example of horizontal access, which means no matter what your domain is or domain is in pharmacy or e-commerce, you can literally customize or personalize these two different types of platform. But when it comes to vertical says these kind of SAS based product OK, designed for a specific domain. So if you look at platform zoonotic, these platform are only built for a spouse and all, all of these kind of stuff. You can use the naughty if you have any spouse alone or anything related with that. And similar thing goes with capillary technology. So if your domain isn't written, no matter you are using omni-channel online detail or offline detail. You can use capillary technology. So xr naughty and capillary technology, all these to SAS based product are basically the example of vertical says because these are domain specific SAS product. So if you look at the benefits of SAS product, they basically have low marginal cost, high profit margins, easy to scale, and they have a lot of reoccurring revenue, which I have already explained using MRR and ARR, the metrics. 3. Chapter 3 what us univerisity management software: Now that is all about IES, bass, bass and Sasson production. But as promised, we have to make some marketing strategy or so-called business strategy for this SAS product, which is a university management software. And just to take an example, I have taken example of parachute dot IU. For example, this is the university management software which we are breathing right now. And we basically needs to sell this university management software or different universities. And let's see what other different features we can build in this SAS product and how we can sell this as product by creating multiple funnels, by analyzing the unit economics and how this university management software is going to be successful. If you are planning to build any SAS based product, this router is going to be very helpful for you guys because it will give you a, some sort of prospective that how you can go along with different processes and how you can basically make some metrics to analyze the performance of your sass burning. But before jumping into the marketing strategy or the genetic Gnostics of this SAS based product, we first need to understand that how this task-based product is gonna look like. What are the different feature of this product? And we first need to understand about the overview of this project. Now this SAS product have different modules in it. For example, if you take an example of Darwin box, which is a channel platform that have more tools like on-boarding training. So if you look at this university management software, what a SAS predict, you have models like onboarding. So you basically first create some campaigns on Google or Instagram, and you basically create some funnel so that people will inquire about your college or different courses in your college or university. And then you basically lead, nurture those kind of leads. And basically once you know to those lead, then you can start doing the registration process. So all these campaigns lead nurturing, registration kind of things will comes into modern called onboarding. So we have an Onboarding module, then we have staff management module which basically CAPX grid of different stuff. So you have teachers, you have different people who can takes care of the maintenance. You have security people, then you will have different made or different people who use really takes care of the cleaning and the hygiene of the university. So you have different stuff and then you have stuff century, which also covers the HRM part, which is human resource management. How much sadly undertaking. So and then we have liability management module. Saw how many books are there in the liability? How many students are using those books? How many books are issued to how many students, how the deadline is gonna look like, how the fine structure of those different books and all the library management stuff will go in this morning. So we haven't liability management more than this SAS product. Then we have student information system, which is a different model. And Student Information System is the most important module of this university management software. Because majority of the student and teachers are going to in practice using this student information system. So basically, what are the different events which are coming? For example, you have internship, which is coming from different companies. You have some management event, you have some placement companies which are coming. These all are the events. Then details are also going to share some sort of coarse material or sturdy material with the student. Student might need to ask some doubts to the teachers using the app. So then we have a student information system which basically provide a platform between the interaction of Student. So all these three different particles interact in the student information system. Then we have gates accordion, GPS tracking. So basically different security guard which are there indicate so how many students are coming in, how many students are going out? And if they are coming in, they are putting the fingerprints. If they are going out there also putting their fingerprints, then we have GPS tracking for different buses. So if you also university have different buses to carry those students from their home and basically dropping them back to their home than at which location all these buses are. What is the timing when they're coming back? If any bus is late? How much time that bosses late. So you have a proper model for gate security, for GPS tracking, for all of that kind of stuff. In the end, we have one more module called Mass and cafeteria, in which students can order the food, coffee sitting in their hostel that can also check the menu of the mass and Cafeteria. Now parachute IQ is going to sell all these different kinds of module, two different universities if they declare. So for example, if one university only need student information system and staff management modem, parachute dot IO is only going to sell these to different module at a specific price. Now, obviously their main target is to sell all these different kinds of modules so that they can get a whole ecosystem of different sort of services. And all these services can basically all interact with each other and, and they can provide ecosystem of different services. But these are independent modules and they have independent pricing. Now parachute dot IO can use three different type of pricing strategy. They can either put price on different manduneun or either they can put a price on different student, for example, they'll say, OK, we'll just do $1000 for every single morning for one year. Or they will say, We'll just $5 for every student every single month. So they just need to figure out which one will make more sense for their business. And they can use different pricing strategy based on that as well. 4. Chapter 4 SAAS unit economics: Now let us understand the most important part of SAS based product, that is the genetic genomics. And from genetic genomics, we are able to understand that how exactly the reoccurring revenue is giving the real power to the SAS category. But before that, you need to understand some basic terminology which is used in unit economics. And these are not very difficult if you can understand these terminology well. We have average revenue per user. So if you really want to find out what is the average revenue per user, then you need to divide the monthly revenue with the total number of user. Next we have John rate. So basically if you find out disjoin break of your business, so you just need to divide the number of stopping uses divided, right? Then there is a term called average lifetime of a customer. So you really divide one by churn rate and you can easily get the average lifetime of a customer. For example, if the churn rate is 10%, then you will divide one by 0.10. It comes out to be ten years. So every year if 10% people are living down the lane in ten years, older people have been left. But for that case, you need to add more and more people into your platform so that you can balance your new users with the turning rate. Then we have customer acquisition cost. So to define the customer acquisition cost and a simple way, you basically divide the total budget, which is located for advertising, divided by the number of ping uses which you are able to get from that advertising. So for example, if you have invested $100 for any product and you are able to get ten users out of those 1000 product. So it'll customer acquisition cost is hindered dollars. So COGS is basically the cost which is required in manufacturing deployment. And this will exclude the celery and the advertisement cost. So if we look at this COGS of any SAS will direct the hosting cost, the sending of the support of the accounting team. Any cloud solution like male or GitHub. These are all comes under this USGS and you can divide this by the number of period claims so you can use. Then we have lifetime value of the customer. So average revenue per user multiply by the average lifetime of a customer. For example, if the average revenue per user per year is $10, and if your user is lasting for ten years, then your lifetime value is a $100, then we have average Czech and every check is basically the monthly revenue divided by transaction. So for example, if you are generating handler dollars of monthly revenue and you are doing ten ton diction, then your average at least $10. So basically you are interacting with the platform ten times a month. Now we will use all these unit economic metrics for odd university management software. Now, I've really tried to put a problem in front of you. And then together we will solve this problem. Now for example, parachute dot IU mix our university management software and they are acquiring a customer in $2 thousand. That the help of a salesperson and the genre is 10% per year, which means that the customers or the universities are leaving their software or leaving the SAS product and choosing a new platform. Every single year and that predict prices handled all of every single month. So basically they are charging $100 per year. And the heavy profit margin of 70%, as I have already described, knew that says for a tough high profit margins because they just need to build a product, a default place, and they can sell that product to as many people as they weren't. So their profit margins are very high. So just need to calculate the customer lifetime value for this Parachute book I, your product and the profits, which can company meek once they can start selling this product to different customers or different universities. Now first we need to find out the retention rate. So 10% is the churn rate. So what is the retention rate? So if then Poston, all universities are leaving the software every single year, then almost in Bengio's all those university when left. So to counterbalance this John read problem, you just need to look for different and different universities every single year. Then we have lifetime by Lou. Lifetime value is basically the average value of your sales multiplied by number of projection when people I've either retention or impeded. So for example, the average price of this product is a $100 per month. And the transaction happening per year is 20 to addiction because a $100 per month, which is N, will be a cutting revenue and customer audit ending for ten years. So basically the customer lifetime value for this product is dwelled $1000. Now because we have assumed that V or counterbalancing the John in that situation that John factor is not going to effect our unit economics. So basically to find out the customer lifetime value, we will multiply a $100, which is bottom on product price into 12, which is 12 months we have in the ear, and then the customer will last o b does for ten years, so that postal customer lifetime value is going to be $12 thousand. And then now if you look at the lifetime value of a product, hundred-dollar is the price of the product. Customer is paying 20 times E0 and the retention rate is linear, for example. So customer is basically paying us $12 thousand. Not what does the customer lifetime value. So when you multiply the lifetime value with the profit margin, then you'll get customer lifetime value. So we have $1000 as our lifetime value. If you multiply this with 70% of our profit margins, then will get $8,400 as our customer lifetime value. So what acquisition cost is $2 thousand. So if you look at the gross profit, then our revenue is $8,400. Our acquisition cost is $1000. So we have our gross profit of $6,400. Now or beyond this course goes, Robert, we also need to subtract the operational goals, the salaries, and all that kind of stuff, getting to the net profit range. But that is the overall scenario of the gross profit. Which means that if you build assessment product and you sell that product to different customers, then you end up getting a lot of high gross profit. And basically if your gross profit is very high, and if you can minimize your operational goals to annual salaries in that situation, you end up getting a lot more net profit of photos aspects, product. So this is all about unit economics. Now we've really tried to create a marketing funnel for process-based product. But before that, you need to understand that what are the different stages of a marketing auto sales funnel and how you can put different universities or different people on this SAS based product. And you basically convert them. Now this product funnel or the marketing funnel is not exactly four SAS product. If you are building an e-commerce store or if you're building any XYZ product like smart water bottle or any mobile cover. So in that situation, you can use these sales funnel to sell anything you want. So first, you need to create awareness for your product. And you can create awareness through different medium or through different platforms. So if you have a consumer facing products, then you need to create awareness through some influencers. So there are multiple influencers, so-called social media influencers on Instagram, facebook, Snapchat. So you can take a help of those influenza and you can basically send your product to those influencers and tell them to do unboxing or to try out your product in front of people on Instagram or on Snapchat. So that's how our awareness is created. Then comes the interest and the concentration stays. So if you can convince those influencers to highlight the offers and the benefits of the product they are unboxing are using on their social media platform. So basically even create interest and evolution for those different product and intended something when you try to provide some link or some useful resources to your customer. For example, tomorrow if you tell those influencers, once you do that, unboxing amongst you highlight the benefits, then you can start putting the swipe up link for our website, the link in your bio and all those different kinds of stuff so that people can visit our website, they can see our product and the benefits of a product. And then they can even look at those product. And even though it is basically looking at your website analyzing different product, what is the review, how the price is going to look like? And once they even divert, then the funnel or the final stage of the funnel, that is the purchase stays on after Butch, isn't it? I do are doped into that atmosphere or the ecosystem. So we already have a much better idea about this funnel. Now we will try to understand what are the different tools you can use a different stage of the funnel. So at the top of the funnel, if you really try to put more and more people in the awareness stage in that situation, you have to use things like SEO or PPC campaigns, which is pay-per-click or social media influencers. So you basically put campaigns on Google ads, on Facebook ads and Instagram ads. And you can drive more and more people on your platform. So you will basically try to put more and more people in the funnel. So there you have more people in the awareness stage and then you have a landing page. So any people who see your campaigns on Instagram feed or on Facebook feed or on Google. Crp, which is search engine result page. Then he ended up lending into a specific website or landing page. And in landing page you have to analyze different metrics like what is the bounce rate? What is the heat map? So bounce rate is how many people are leaving. Your pH. And heat map is basically a rich area, specifically your customers out of scrolling up to and reading the content. So in the landing page, you have to use different sell our product to optimize the landing page. Then you need to do some content marketing to stock those are high SEO keywords. Then you need to optimize your website using different plugins, like in board president, multiple plug-ins to optimize your website, to make your website open much faster on mobile or on different product like laptop and tablet. Once you can optimize your landing page, content marketing and website optimization, then comes the convergent stage or the awareness of the intent stage. Once you can optimize your content and website, then comes the prospect of decile stage, where you are using multiple marketing or the e-mail marketing campaigns or the e-mail marketing threads. So you add a 20 multiple emails too aware about your product, then you can start putting emails to highlight the benefits and the use cases of your product. And then you can finally give the pricing and the benefits of your product. At the final stage, then you can use platform like male chimp, Mockito, Send grid. And all these different kind of platform will really helps your convergent and they will help you to widen your funnel, get more and more people into the sales and the loyalty stage. And then that'll help you to generate more and more reoccurring revenue. Just to give you an example, if there are a 100 people which are entering into a funnel, you end up getting one or two convergent. So conversion rate is hardly one or 2% no matter how good or bad your product is. So you basically needs to put more and more people into the awareness stage.