Two SaaS Companies that Solve Business Problems for Customers

In a couple of recent blog posts (here and here), I raised the question of what type of cloud computing start-up would be likely to succeed in today's business environment, in which companies of all sizes are interested in cutting costs and minimizing risks. I suggested that business customers would feel comfortable with new programming paradigms (e.g., Salesforce.com's Apex) offered by large, stable companies, but shy away from similar offerings from smaller vendors. It's not that the smaller vendors won't get any customers; they just might have a hard time getting enough to stay in business.

Cloud Computing Opportunities for Start-ups and Other Small Companies

But, aside from infrastructure offerings, there are lots of great business opportunities for small cloud computing vendors. I believe that most of these opportunities share these traits:

business domain expertise + effective execution + cloud technology

Being small and new won't be problems (i.e., risk factors in the eyes of customers) for small vendors who demonstrate that:

• they thoroughly understand business process problems that are important to the customer, and they are dedicated to solving these problems
  
• they have a solution that directly addresses these problems in an immediately effective way
  

Getting Down to Business

Here are two software start-ups that offer examples of what I mean.

Compli is a SaaS company based in Portland, OR, that offers a software platform that enables car dealers to measure and manage their compliance with industry regulations. Through the Compli SaaS platform, car dealers can deliver compliance training to employees and employee test scores on compliance tests. As regulations evolve, and new state-specific regulations appear, dealers can distribute new compliance content to the appropriate employees and demonstrate "good faith" efforts at compliance.

Compliance is an important issue for car-dealers, an operational head-ache of sorts, and Compli's SaaS solution gives them an easy way to stay on top of the issue in a cost-effective way.

If you visit the Compli Web site, you'll have to hunt hard to find any references to SaaS and cloud computing. The words "SaaS" and "cloud" don't appear on the home page at all, and in the video featured on the home page, President and CFO Lon Leneve mentions SaaS only after discussing the scope and importance of compliance for car dealers. The company is focused on solving a business problem, and they're leveraging SaaS technology to do it. How's Compli doing? Last year was a record year.

I've written about Liquid Planner before, and I'll be writing more about them next week. LiquidPlanner offers a hosted project management solution that brings probabilistic analysis to project planning. In another words, while other programs like Microsoft Project force project planners to give a fixed estimate for how long a task will take, Liquid Planner lets planner input ranges and probabilities, so they identify risks up front. The result is planning software that's more detailed, more accurate, and more informative.

The solution includes other collaboration features, as well, but I'd like to point out that once again we have a SaaS company focused on solving an important business problem—project management—in a new and compelling way. Factoring probability into project planning makes so much sense, I think LiquidPlanner would be an attractive offering even in a traditional, in-house deployment; delivering LiquidPlanner as SaaS, so it can reach all members of a distributed project team while lowering hardware and software costs, only makes it more compelling.

And how's LiquidPlanner doing? Quite well. Business is growing. The company itself is a small, lean-and-mean team of ten people whose founders have extensive experience in data center management from Expedia. Steve McConnell, who has written authoritatively on rapid software development and software estimation, is an advisor to the company.

These two companies, Compli and LiquidPlanner, demonstrate the business opportunities available for SaaS start-ups. Both companies are focused on solving important business problems (regulatory compliance and project management) in new ways. The problems they're addressing will remain important to customers even in an economic downturn. The companies are leveraging SaaS to deliver their solutions broadly and cost-effectively. Both companies share share these characteristics:

business domain expertise + effective execution + cloud technology

Disclaimer: Neither Compli nor LiquidPlanner is a client.