Tales from the Trenches: What I Learned From My Failed Software Launch

Business.com / Starting a Business / Last Modified: February 22, 2017

I learned the hard way that I should have launched a productized service before building out software. Here's what I took away from it.

After running a successful digital marketing agency for years, in 2014 I decided I was ready to move on to my next challenge.

I launched my first Software as a Solution (SaaS) product in October after 10 months and $55,000 of development costs. I made every mistake in the book, like not talking to potential customers, not validating the product, etc.

It was a scratch our own itch sort of thing at my agency and I assumed every other agency needed it too. 

Sadly, I was wrong. But I learned a lot of things in the process, and I'm happy to share them with you. 

Defining a Success Metric

I always recommend having a goal defined when trying to launch a new business. It might be to have X number of commitments, or Y number of conversations with targeted prospects. I generally advise on it being revenue focused within a certain time frame.

For my first SaaS product, I set that goal to be $2,000 per month in recurring revenue after 60 days. If it did not achieve this, then I would admit failure and move on. Your goals can be whatever you want them to be, but the purpose is to let you know if you are on the right path or not. After 60 days, it was at $400/mo in monthly recurring revenue (MRR).

Admitting Failure and Moving On

When my idea of success didn’t happen within my given timeframe, I decided I needed to move on to another idea.

This time, I wasn’t going to waste $55,000 on building out software. Instead, I was going to evaluate what I already had at my disposal to get something launched quickly and then as things started to prove themselves, I would look at jumping back into software.

Related Article: Who You Gonna Call? Who to Lean On After Your First Entrepreneurial Failure

Starting with a Productized Service

A productized service is more scalable than a typical service offering. At my agency, we offered everything under the digital marketing sun. This makes it tricky to scale out those sorts of services unless you have a templated way of going about your business.

This means having defined standard operating procedures that are repeatable.

Given that I built my agency up using scalable and repeatable lead generation processes I created, I felt like this would translate well as a productized service. I could leverage some of the software I had already built previously for my own use, and offer to help B2B customers reach their potential customers.

Launch and THEN Figure it Out

So often, entrepreneurs get caught up with all the planning and trying to make it perfect. I made this mistake too. Over the years, I have learned to flip that on its head and just go, go, go. I have this poster on my wall for this reason:

Launch a SaaS Product

I proceeded to launch LeadFuze from idea to live in 24 hours. I even live-blogged the whole thing.

Once I got it out there, I decided my success metric was to reach $1,000 in revenue in the first 30 days. Luckily, this happened and things started to take off. It wasn’t until 7 months later that we launched a front end software version of our tool. This was because by then, the need was validated (aka people paid us money to provide this service) and so I felt good about going this route at this point.

Related Article: 5 Technology Trends That Have The Power to Change Your Business

Patch Your Own System Together

In my particular case, I looked at what I had available to me and used previous combinations of software I had created. However, you could just as easily patch together a productized service using tools that already exist.

For example, my buddy and Zero to Scale podcast co-host Greg Hickman, runs a productized service called System.ly. He provides marketing automation support and leverages tools like Infusionsoft, ConvertKit, and Drip.

What different tools are available that you can leverage and build a productized service around?

The Benefits of Going Productized Before Software

By first launching a productized service, you get several key benefits:

  1. You get launched quicker and won’t hold off because of bugs and other delays
  2. You start selling sooner which helps you validate that your solution is needed
  3. You are able to really dial things in and learn exactly what you need the software to do
  4. Less expensive and you are able to re-invest earnings into the software

LeadFuze was profitable from the very beginning and I was able to self-fund the business with its own profits.


If you are thinking of launching a SaaS product, look at the market you are planning on getting into and see if you could provide a manual service initially with the intention of the manual work being replaced by software as you move forward and start gaining traction.

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