Why Make Your SaaS Self-Hostable?

So I bet there's a ton of questions, like "Why would you want to make your app self-hostable?" And "Isn’t it just “more-work?” "What about the monetary return of selling SAAS"? Well, they are all very valid. All things I've considered, thought about, wrote about and researched so let’s break them down.

Why Would You Want to Make Your App Self-Hostable?

Let's start with the biggest question of them all, "Why"? Building a self-hostable opens up a world of opportunity and different markets. You are in full control of the distribution and can design it as such.

Before we even dive into this, realize that making your app self-hostable does not mean you are making an app that can not be hosted as a SAAS in the cloud. It's the opposite. You are making a SAAS that can be hosted in any cloud. That means you can host your SAAS, but so can others. Wouldn't this hurt your bottom line? Affect MRR? Destroy the primary purpose of building a SAAS? Not if you design your business in a way where it's complimentary. And that's what I mean about opening up a world of opportunity and different markets.

Isn't this just more work?

Overall, not really. You will have to make the configuration and environment variables for your app accessible to the Super Admin instead of in a file. You will also have to focus on the user experience of setting up your app. Other than that, just build! I've found that working through some of the Super Admin settings actually makes managing your SAAS easier for yourself. So in the long run, it might be good to run through for your cloud based SAAS as well.

Will I Lose MRR?

We will focus a lot on this when we run through monetizing your application. I won't be going through the marketing for a traditional SAAS, but how to make money on a self-hosted model. We will discuss the possibility of a low overhead business to customer (B2C) app with community support. A buy once model (thanks Basecamp!) and the math behind it. And how to keep your standard SAAS but offer a self-hosted version where security and privacy are the upmost concern.

B2C Apps

One point I really want to hit with designing a self-hostable application is the opening up B2C marketplace. B2C is hard. Most indie-hackers, product developers avoid it like the plague and I don't blame them. Individuals have less money than businesses and usually require more features before purchasing. I think this is where self-hosted applications can really shine. You could do a buy once model and let the customer host it and you provide the support.

Think about it this way. Say you are writing a cloud only SAAS for customers. It's $10/mo. If you can onboard customers, great, but now you have to think of server costs. Your app is successful, even better! Now you have to scale, provide the same level service, and hire people. What about churn? Lots of customers when times get tough cancel their subscriptions. You can't do a lifetime, one time price with a cloud based SAAS or you will find out real quick what that threshold is where you lose money.

Now let's reframe this. Say you sold your app once to a customer for $99. You don't have to scale it. You essentially bought 10 months of that user's subscription. You just have to release updates. Well, they have the choice to upgrade for a fee if they want, or continue running what they purchased. It's simple and saves you some headache!