Riding the Giant SaaS Wave in India
Blog: NASSCOM Official Blog
Riding the Giant SaaS Wave in India
NASSCOM conducted a Tweet Chat on the topic “Riding the Giant SaaS Wave in India” last week. The panelists for the chat were Suresh Sambandam, CEO Kissflow and Sangeeta Gupta, SVP NASSCOM. The chat revolved around 2 aspects: How IT service professionals can ride the Indian SaaS wave and The Great Indian SaaS story. Key highlights of the chat are covered below:
SaaS in India is at an interesting cusp for growth acceleration. $3.5 bn revenues, 1000+ companies, 3 bn funding, 6 unicorns, Indian SaaS story has now built a strong foundation and can be the next growth driver for Indian tech.
SaaS offers a Trillion dollar market opportunity and India SaaS can rule the world if this potential is tapped. IT services market played a key role in establishing the base for this growth. Over and above India also offers natural advantage of super solid foundation of IT services industry.
Innovative solutions, Covid_19 and Cost rationalization are the three imperatives driving SaaS adoption. As work has shifted to remote locations there is increasingy demand for collaboration tools, cybersecurity solutions, automation Products etc.
Key Growth segments – Remote collaboration, Cybersecurity, Analytics, Telemedicine, E-learning
Key Drivers – Verticals like BFSI, Retail, CPG, Healthcare
India is the world’s biggest B2B Talent Hub and SaaS is all about B2B businesses. Hidden DEEP inside IT Services companies are a niche but special breed of talent called the “solution architects” for applications are plenty, close to 50,000 of them. And these solution architects can create roughly 50,000 SaaS companies.
Investment in upskilling in core areas like product management, UX, emerging tech use cases, API can help India become a hotbed for #SaaS talent
Indian IT services have deep domain expertise in every vertical which needs to be producitivised to make India a ‘Global SaaS hub’. It can take a decade for India to realize this transition from IT Services revenue base to product-based revenue base
SaaS companies can be divided into vertical and horizontal SaaS. Horizontal SaaS companies are simply industry agnostic and their solution can be used across all industries whereas vertical SaaS companies are very industry specific. Companies like Kissflow, Freshworks, Zoho are good examples of horizontal SaaS. Companies like Zenoti, Capillary are good examples of vertical SaaS.
SaaS companies success during COVID-19 can also be complemented by the fact that SaaS only needs internet and a laptop and a SaaS professional can work anywhere from the world without an office.
Some myths around building SaaS business also exists like:
- Myth: SaaS is always about funding
- Fact: SaaS is not always funding
A founding team of 4-5 people max 10 people can create an INR 5 Crore to INR 10 Crore SaaS company ($1M – $2m) easily without funding or with least amount of funding or through grants or accelerators.
- Myth: SaaS start-ups can thrive only in Tier 1 cities, its all about location in SaaS
- Fact: It is possible to build global SaaS companies from tier 2,3 cities and towns
There are successful SaaS companies in Renigunda, Tenkasi, Jalandar, Indore, Ahmedabad. One no longer needs to be in metro cities like Chennai, Bangalore, Delhi or Mumbai to succeed.
SaaS Skills Priority
- Product Management
- Design – Product Design
- Marketing mostly Inbound marketing
- Sales mostly Inside Sales
Usually, founders start with technology skill and build the product first and try hard to sell it. This trend needs to change to avoid SaaS failures.
SaaS a $100 Bn industry globally, has an addressable opportunity 4X the current market size by 2025. India has all the right ingredients to achieve this target:
– Talent: almost 1 million engineers graduate every year
– Role models: Zoho, Freshworks, Druva, Postman etc
– Entrepreneurs: 3rd largest start-up hub; growing domestic market and the ‘can do’ mindset
Key Priorities for NASSCOM / Industry
- Nurture SaaS ecosystem through mentorship and acceleration
- Enable procurement in government and public sector – Atmanirbhar vision
- Evangelize India brand in SaaS
- Focus on product skills at universities
- Collaboration with IT Services companies
SaaS has the potential to grow multifold, what it requires is the combined and concerted effort from all the stakeholders to make India a product nation.
You can find the full tweet chat on this link: https://twitter.com/NasscomR/status/1296096054228799489
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