6 mistakes most SaaS startup founders make in monetization

If your startup is built around a software product, you'll need a way to make money. Here are 6 most common mistakes by SAAS startups:

1. Limiting To one form of Monetization

You can monetize the product by charging a flat rate for access or a subscription fee to use it monthly. You could subsidize the business by featuring advertising in your software. You could offer the software free but charge for extras, like upgrades or premium features.

2. Assuming To Know User's Preference

Even in today's world of data availability, some business owners prefer to make decisions based on intuition rather than available information. They think they know what their users like instead of experimenting to show what they like.

3. Wearing Too Many Hats at a Time

You don't have to make monetization decisions alone. Of course, it is best to make these decisions with the help of outside experts, who can provide you with different data and new insights.

4. Overengineering Solutions

There's nothing wrong with wanting to offer your customers more features and higher quality services, but if you spend too much time and money on products or features that your customers don't actively use, your profitability equation is going to suffer.

5. Viewing Monetization and Growth as of Conflicting Nature

Some SAAS startups forgo monetization altogether in the early stages, focusing entirely on building a more robust user base. Only once their desired growth has been achieved do they introduce monetization strategies.

But it's important that you don't see growth and monetization as adversarial or of conflicting nature.

6. Focusing Too much on Acquisition

Acquiring a new customer is more expensive than retaining an existing customer. Whichever monetization strategies you have, it's best to focus on retention as a priority.

That's a wrap! Do let me know your opinions in the comments.