Finding Micro SaaS Ideas in 2021

November 21, 2020

Most people jump right in and start hunting for a business idea. While serendipity might strike, you want to follow a path that leaves less of the outcome in the hands of fate.

For that, you first need a framework for evaluating micro-SaaS ideas. This guide works whether you are finding micro-SaaS ideas in 2020, or for the next year or future. Most sections of my guide are evergreen (it was intended to be that way).

How to go about looking for micro-SaaS ideas?

What makes a good idea, what makes a bad idea, what's an idea that is feasible for a one person SaaS or your current team size and technical chops.

It's really hard to nail down what's a great micro-SaaS idea. But there are some factors you can consider that will help you discover, identify and qualify good ideas.

Growing markets

Market drives everything, and picking the wrong market can be the death of your business even before you start.

By picking a market that is already growing (think no-code site builders, or the demand for product feature upvote tools as an example), you ride the momentum of the market and get customers more easily than in a stagnating market.

A defined audience

Following the very definition of micro-SaaS, a great idea is one one that targets a very narrow audience.

A lot of people think a niche idea is something obscure that only a few people know or care about. While you can chance upon truly niche micro-SaaS ideas organically during your journey, when you're at the beginning of of your journey you're better off looking at clever ways to splice a small pie from a large market.

For example, if you start with live chat, that's a huge market. What's a niche version of it? Live chat for e-commerce stores.

Nope, go further. Live chat for e-commerce stores on Shopify platform. Further. Simple and affordable live chat that's very clean design and light on resources. Yes, that's a defined enough audience.

In summary, a defined audience is one that's very easily identified from your definition to answer the question of who you serve (and equally important, who you don't).

Revenue potential

Also bear in mind that your audience can't be 1 or 10 people, as that wouldn't be enough for you to make a livelihood out of. While evaluating an idea, you need to consider what's the average customer going to pay you per month.

Suppose it's $15/mo, and your livelihood target is $3000/mo, then you need 200 customers. So when you define your market, try and validate that there are at least 10-100x that many available pool of customers.

You don't need a billion dollar market size like unicorn chasing startups. But it should be big enough that if you capture 1% of this defined narrow audience, you can hit your livelihood goals.

Product complexity

Let's face it, as a solo founder or two-member team, it will be really hard for you to build a fully-fledged marketing automation tool that takes on Klaviyo/Mailchimp, or a customer engagement platform like Intercom.

It's of utmost importance that you pick a micro-SaaS idea based on what's realistically achievable with your available resources.

If your MVP takes more than 2-3 weeks to build, you're on the wrong track.

If the MLP (minimum lovable) version of your micro-SaaS product for which you can charge money takes you more than 4-8 weeks of development, then you need to refine your idea or think more on the approach to building the product.

Code or No-code?

In my opinion, it doesn't matter. There's a bajillion money-making ideas that can be achieved with code, and without code. The most common example of a no-code idea is a jobs board, but have you ever thought of using your core skills in another way? 

What if you created a community of people who want to wake up at 6am and hit their workout and fitness goals as a group, and you can be their group coach and create content for them.

If you're an illustrator, you could create 2-3 unique illustrations a week around one theme, which you can initially distribute for free. In 3 months, you would have 24-36 illustrations, and in a year 104-156 illustrations, which can be monetised by one-time sales or perhaps a yearly subscription.

Coming up with Micro-SaaS ideas

Picking the right idea to build into a micro-SaaS business involves many factors.

The general principles listed out in the previous section would help you gauge any idea against its viability, most importantly to answer the question of "can and should you pick this idea?"

But what about finding actual micro-SaaS business ideas? How to identify niche SaaS ideas that suits your capabilities?

There are a few ways to go about finding micro-SaaS ideas. Read on.

App marketplaces and growing platforms

The way I got started was by picking an app marketplace where customers were already hanging out and looking for solutions to their problems. SuperLemon was built on top of the Shopify App Store, but there are several other similar marketplaces like Atlassian Marketplace, Slack App Store, Intercom App Store, and others.

The way these marketplaces work is, the main platform doesn't cater to super specific needs of a few hundred or few thousand of its users, and a 3rd party developer (this could be you) could create a plugin to solve that super specific need.

Since discovery happens from the app store, you are ensured a steady stream of new customers almost from the day you launch. This doesn't guarantee success, but it does make the process of building a business and earning a livelihood easier as some aspects such as marketing are taken care of.

You don't necessarily need a platform with an app store. Platforms like Stripe or Twitter are also great places to build a micro-SaaS. It's the same formula, specific needs that the platform doesn't solve but there's people who are ready to pay for a solution. The difference here being, the onus on marketing would rest on you.

People might be looking for a solution on Google, so you will have to make the effort to write content, rank on the search engine and acquire customers in that manner.

Ideally you want to pick a growing platform, one that has a huge rate of sign-ups and adoption. This helps your business gain new customers more easily.

And you hit the jackpot if you enter an app marketplace that is nascent but poised to grow tremendously in the coming 3-4 years. Think Shopify App Store in 2016, or perhaps Webflow's app store today?

By the way, Jetboost is a really cool business being built on top of Webflow by selling real-time search, filtering and other nifty features as no-code addons to the platform.

Niche versions of existing large SaaS companies

The beauty of B2B SaaS is that it's not winner-take-all. You can enter an existing market, find one meaningful dimension in which to make a better product, and gain customers.

Userlist is a tool that lets you sent trigger-based emails and in-app messages for your app users. Intercom has the same functionality, but it's obviously ridiculously expensive. Also, you might be looking for just the customer messaging, and not the whole of Intercom's suite of products. They are pulling in

Snappa is a simpler, easier to use, and more affordable alternative to Canva. I've used Canva's product and it's gotten quite clunky over time, whereas Snappa's UX seems simpler and more intuitive.

Productised services

While not technically SaaS, I find productised services fascinating due to the predictable value delivery model and income model, which is subscription based. I'm not someone who will say "it has to be a SaaS and nothing else".

I think if you're already a freelancer or finding yourself looking for certain kind of work at a defined frequency, there's a business case to be made there.

Design creatives is a great example. There's many such players now, Draftss is one, ManyPixels was one of the early players.

Productised versions of freelance work

If you're a freelancer catering to a specific industry, you might come across requests that repeat themselves. That's how Tyler Tringas of Storemapper found his success.

The problems that your freelance clients want solved is a treasure trove of information on which you base micro-SaaS product ideas. If you find yourself in this situation, consider yourself lucky!

Scratch your own itch

This one's self-explanatory, or so I thought. Scratch your own itch is a great place to start, but you need to apply the itch, the idea, with the filters in the previous section. It cannot be an itch that you or only 10 people in the world have, because you cannot build a sustainable business with that.

Pieter Levels of Nomadlist is one of the most successful examples of scratching your own itch.

Dig into your work and discover, are there repeatable problems that you encounter and need to solve through ways that appear manual, or tiresome? Then ask whether solving that problem and making it easy will make your life significantly better.

And finally ask if others might have the same problem that they are tired of, and who might be seeking a solution like you did but they haven't come around to building it.

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3

How to Validate Your Micro SaaS Idea

You have a Micro-SaaS idea. How do you validate it?
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1

What is Micro-SaaS? And why should you care?

Exploring the definition and meaning of micro-SaaS, and why you should care about the micro-SaaS trend at all.
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