SaaS (Software as a Service)explained

SaaS means the software runs on the provider's servers and you use it through a browser or app, typically paying monthly or yearly. Gmail, Shopify, and Zoom are all SaaS. There's nothing to install or maintain on your side, and updates happen automatically for everyone.

For a founder building a product, 'a SaaS business' usually means recurring subscription revenue — the model investors love because it's predictable and compounds. But it also sets expectations: customers can cancel any month, so the product has to keep earning its keep. Retention and onboarding matter as much as acquisition.

The engineering reality behind SaaS is multi-tenancy: one system serving many customers with their data kept separate and secure, plus billing, plans, usage limits, and permissions. Getting these foundations right early is what lets you ship features weekly without breaking last month's customers.