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Not the OP, but their comment makes me think about all the apps (primarily saas) built on top of the Xero API, as part of their marketplace. Build a decent pro
by RileyJames 5y ago
Not the OP, but their comment makes me think about all the apps (primarily saas) built on top of the Xero API, as part of their marketplace.
Build a decent product which covers an edge case (niche) or a feature not provided by the API providers product (Xero) and then sell to the existing customer base.
Some advantages:
- there is already a user base, and their options for solving problems are 1) pay a dev to build x feature, integration. 2) find an add-on product which does xxx or 3) drop Xero and move to xxx competitor who does offer it. 1 & 3 are expensive, time consuming and unlikely the businesses field of expertise (software)
- sales and support at the Saas api provider can become your sales funnel. Not automatically, you have to network / educate them about your solution, and the problem it solves. But once they know, it becomes to ‘unblocker’ for a subset of sales. Which become your customers.
I think many B2B Saas product that offer (and support) an API could represent a similar opportunity.
There are obvious risks, just like with Twitter. The api can change, but I think that less likely in B2B, changes are likely to be improvements or expansions of feature set, even if it’s disruptive to your product / service.
But the major risk, which you must be aware of, and plan for, is the changing strategic priorities of the company you’ve integrated with. At a certain point customer growth isn’t enough, and ppl start searching for revenue opportunities. All these Saas businesses using the API become targets, either for acquisition or for duplication.
Duplication doesn’t mean death, particularly if you have a niche play, and have continued developing your product. But it will significant halt the growth.
All that said, I think it’s a good option for HN / solo / dev first founders who can do the product research, find the gap, and build the solution. Because it seems like the next part (getting paying users) is where most of these adventures run into trouble.
*I was at Xero 5 years ago, but I think this is valid for any B2B. I’d suggest scoping earlier stage products with strong growth, as the runway til their growth slows and they start looking for revenue alternatives is longer. It also allows you to grow with their growth.