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About

AE

Aaron Epstein

12/16/22

@ Y Combinator

Software as a Service (SaaS) is a cloud-based subscription model where customers pay monthly or annually to access software.

Video

YC

Startup Business Models and Pricing | Startup School

@ Y Combinator

Startup Business Models and Pricing | Startup School

12/16/22

Related Takeaways

HI

Harvard Innovation Labs Cast

02/02/14

@ Harvard Innovation Labs

In a SaaS business model, long-term subscriptions change the visibility of revenue, allowing for more accurate forecasting based on customer retention and upsell rates.

JF

Jared Friedman

11/23/24

@ Y Combinator

The shift from traditional software to SaaS was driven by the realization that sophisticated enterprise applications could be effectively delivered over the cloud.

MM

Macy Mills

05/17/25

@ a16z speedrun

Subscription-based pricing offers predictability for both businesses and customers, often combining user-based pricing with monthly or annual subscriptions.

JC

Julien Codorniou

06/24/25

@ Stripe

The trend of self-funding is emerging in SaaS, where companies can grow significantly with minimal teams, thanks to AI and low software development costs.

BH

Brian Halligan

05/08/19

@ Y Combinator

Freemium models, like those used by Atlassian and Zoom, represent the future of software sales, allowing users to experience the product before committing to a purchase.

SB

Steve Ballmer

06/02/25

@ Acquired

We aimed to create a recurring revenue model with the enterprise agreement, which allowed companies to pay a fixed amount annually for software usage.

AE

Aaron Epstein

12/16/22

@ Y Combinator

SaaS businesses make up 31% of the top 100 YC companies, highlighting their prevalence and success in generating consistent revenue.

AL

Aaron Levie

02/20/25

@ Y Combinator

Successful companies are increasingly replacing traditional services with usage-based models, leading to rising revenues without the need for annual contracts.

YC

Y Combinator Cast

11/23/24

@ Y Combinator

In vertical SaaS, the most promising opportunities lie in automating mundane, repetitive jobs that are currently labor-intensive.