Category: Strategy

IaaS, PaaS & SaaS: Choosing the Right Cloud Solution for your Business

Nowadays, the term “cloud” is widely known as an online solution for managing files and storing data. Businesses big and small utilize cloud services, but many are unaware of the extensive capabilities the cloud can offer. As a startup, becoming familiar with your cloud options such as Iaas, PaaS, and SaaS, and knowing the differences, benefits, and drawbacks of each one will help you choose the solution(s) that will help your company be more efficient, cutting-edge, and cost-effective.

What is IaaS, PaaS, and SaaS?

Before diving into the various cloud solutions, it is important to have an understanding of what “the cloud” is. 

What is the cloud?

Rather than acquiring physical servers and equipment that store, manage, and operate data and software, “the cloud” is composed of several servers that are located in large data centres throughout the world, accessed by customers remotely over the internet. By using cloud computing, users don’t have to manage physical servers or run software on their own machines.

IaaS, PaaS, and SaaS

Cloud computing can be broken down into three main categories: IaaS, PaaS, and SaaS. All three types offer enormous benefits to businesses, but understanding their differences will help you determine which solution(s) is the best fit for your company’s needs. 

Infrastructure as a Service (IaaS)

Allows customers to manage their company’s resources — network, servers, data storage, etc. — on the cloud. IaaS is made of scalable and automated computer resources that businesses can access themselves via a virtual data centre in the cloud, and can purchase resources on an as-needed basis rather than having to buy the hardware outright.

IaaS uses virtualization technology and is usually provided to the customer through a dashboard or an API. When using IaaS, you are responsible for managing things such as applications, runtime, OSes, and the IaaS provider manages the servers, hard drives, networking, virtualization, and storage. 

IaaS Advantages:

• Easy to automate deployment 
• Allows complete control over infrastructure 
• Purchase resources as-needed
• High scalability 
• Allows for multiple users

IaaS Concerns:

• Security threats to the hosting provider
• Staff training may be required so your team knows how to properly manage the infrastructure

Platform as a Service (PaaS) 

Used by developers allowing them to host, build, and deploy consumer-facing apps through a web-based platform. Using PaaS, developers are given the freedom to concentrate on building software without worrying about operating systems, software updates, storage, or infrastructure.

PaaS Advantages:

• Easy to use
• Cost-effective app development and deployment 
• Scalable
• Customize apps without having to maintain software

PaaS Concerns:

• Ability to integrate with other existing apps
• PaaS may not be a “plug-and-play” solution for existing apps limiting its effectiveness 

Software as a Service (SaaS) 

SaaS is the most common cloud service with applications designed for everyday use for both individual consumers and businesses. The majority of SaaS programs run directly through your web browser, and rarely require downloads or installation on individual devices — a massive benefit for teams working remotely or working across international borders. 

By using SaaS applications, your business does not need to manage technical issues, servers, or storage which can often be a huge burden on time and costs if you do not have a dedicated I.T. person or department in place. 

SaaS Advantages:

• Creates better efficiencies
• Reduces time and money spent on installing, managing, and upgrading software. 
• Frees up physical space (no need for on-site servers)
• Easy to find and use applications as needed 

SaaS Concerns:

• Limitation of app integrations
• Data security
• Ability to customize app features to the needs of your business

CCaaS and CPaaS: What are They?

Contact Center as a Service (CCaaS) is a form of SaaS that is specific to contact centres. These cloud-based contact centres are ideal for small and medium-sized businesses that want an easily deployable and easy-to-use solution. CCaaS products offer rapid deployment, however, they can have limited customizability and scalability. 

Communications Platform as a Service (CPaaS) is a cloud-based product that allows businesses to have real-time communications capabilities (i.e. voice, video, instant messaging) to business applications by deploying APIs. 

Rather than building your own communications infrastructure from scratch, you can use CPaaS products in existing applications by only adding a few lines of code.  

Examples of IaaS, PaaS, and SaaS

IaaS: Amazon Web Services (AWS), Google Cloud, Microsoft Azure

PaaS: Google App Engine, Heroku, Apprenda

SaaS: HubSpot, Dropbox, DocuSign

Which is Best: IaaS, PaaS, or SaaS?

Determining which cloud solution is best is completely dependent upon the needs of your business. Below are ideal scenarios in which IaaS, PaaS, and SaaS could be used to help decide which type of cloud service you need.

IaaS:

• Startups with minimal cash flow that cannot afford their own hardware or software.
• Only particular resources are needed.
• Experiencing rapid growth with infrastructure needs quickly changing within short periods of time.

PaaS:

• Multiple developers need to work on the same project.
• Vendors are involved in the development process and need access to the application.
• Creating a customized application.

SaaS:

• Startups that need to launch their e-commerce quickly. 
• Short-term projects. 
• Applications that are only needed periodically and not regularly. 

Working with cloud solutions can add tremendous value to your business, but it can be difficult to decide which technologies to invest in when your startup’s needs are changing. 

Working with a startup mentor or joining a startup incubator guides you through your startup’s journey, helping you make decisions that are smart and strategic for your business. 

Lean Startup Methodology: What it is and why it has changed everything

For many years, startups have been built by taking a business idea, discretely developing a product or service, launching it, then marketing it to consumers. This process can result in business success, but it can also leave many startups vulnerable to failure. When startups spend a lot of time and money on product development without including customer needs and perspectives in the process, the number of sales that will be achieved becomes a guessing game — a high-risk gamble when early revenue is imperative to keep the business alive. 

When approximately 50 percent of small businesses in Canada won’t survive longer than five years, more and more startups are following the Lean Startup Methodology to lessen risk and create a higher probability of success.

What is Lean Startup Methodology?

A great way to think of Lean Startup Methodology is that it aims to discover if a product should be developed, not if it can be. 

First introduced in 2011 by Eric Ries in his book, “The Lean Startup”, Lean Startup Methodology designs and builds businesses and products based on consumer needs and demonstrated desires rather than first developing a product and hoping there will be a demand.

Too many startups make assumptions about what consumers want and spend years perfecting a product only to discover that consumers have little interest or are unhappy with its features. If your product is super innovative but people don’t want to buy it, a business will not exist. 

5 Key Principles of Lean Startup Methodology

1. Entrepreneurs are Everywhere

There are many types of entrepreneurs and therefore startups don’t need to fit a particular mold to apply lean startup principles. 

2. Entrepreneurship is Management

Lean startups look a bit different than traditional startups. It is less about processes and protocols and more about being learning-driven, flexible, and making changes as you go. 

3. Validated Learning

Through experiments and retrieving results, lean startups make decisions by learning and adapting to the needs of consumers. 

4. Innovation Accounting

Keeping detailed records of experiments and analyses is important to determine how to proceed. Lean startups must monitor processes objectively and come up with next steps.

5. Build-Measure-Learn

Lean startups build a Minimum Viable Product (MVP), then put it through extensive testing and evaluation with customer feedback. By building a product and then measuring its effectiveness, lean startups learn and improve their product before finalizing it.  

How has Lean Startup Methodology changed everything?

a) Detailed planning used to be one of the most crucial elements for a startup. Lean startups now consider experimentation more valuable, and consider five-year business plans an ineffective use of time.

b) Lean startups already have an established customer base by the time their product is ready for wide distribution because they have been involved since the beginning stages of the product.

c) The hiring process has pivoted giving preference to applicants who can learn and adapt easily and placing less emphasis on experience and technical ability. 

d) Financial reporting focuses on customer acquisition costs and lifetime customer value among other things rather than traditional income statements and balance sheets.

How to Apply Lean Startup Methodology

Learning why Lean Startup Methodology can benefit your startup is much different than knowing how to apply it. We recommend turning to an experienced startup mentor to help guide you through the process of becoming a lean startup. 

Having a startup mentor or joining a startup incubator provides you with invaluable knowledge, expertise, and support so you have more confidence and success in applying the Lean Startup Methodology.

Web 3.0 Business Opportunities: How You Can Stay Ahead of the Curve

These days, technology seems to evolve and become more advanced in the blink of an eye. It can be hard to stay on top of it. The one upcoming advancement that will make the most significant impact on the world is Web 3.0. Unlike the internet’s earliest version Web 1.0, and today’s Web 2.0, the next phase of the web will be decentralized, user-generated and governed, and integrate sophisticated forms of technology such as Artificial Intelligence (AI).

As a business owner trying to grow a startup or small company, being educated on Web 3.0 and how you will be able to use it to your advantage is what will keep your business relevant and successful, and differentiate you from competitors. 

What are Web 1.0 and Web 2.0?

The best way to begin explaining Web 3.0 is to look at the web’s previous and current versions.

Web 1.0 was the earliest version that lasted from the early 1990s to the early 2000s. This was read-only where users consumed static content in text or graphic format that was created by web developers. In Web 1.0, there was little interaction from users on web pages.

Web 2.0 took off in the mid-2000s and although it has evolved tremendously since we are still using Web 2.0 today. Web 2.0 is an interactive social web where users are heavy content creators as well as consumers. The easiest examples we see are on popular platforms like Instagram, Facebook, Twitter, and YouTube, where content is created, shared and commented on by the platforms’ userbase.

What is the problem with Web 2.0?

At the beginning of Web 2.0, allowing users to consume as well as create content was a huge advancement from where the world wide web started. However, as time showed, huge problems surfaced surrounding the lack of legal protection of users when it came to ownership of personal data, privacy, and surveillance. The content created by users on Web 2.0 is centralized and controlled by large tech corporations’ websites where people share content, such as on Facebook and Instagram. For many years this allowed tech giants to use users’ personal content and data to generate massive profits.

What is Web 3.0?

Web 3.0 is a decentralized web that will allow users to participate in not only content development, but also own and govern their materials.

Rather than have content centralized and owned by large corporations, Web 3.0’s decentralized infrastructure will protect individuals’ content and privacy, putting more power in the hands of the user and less in the hands of the tech giants. 

Web 2.0 vs Web 3.0

The major differentiator between Web 2.0 and Web 3.0 is the latter will be powered by blockchain technology, using cryptocurrency, AI, IoT, augmented reality, virtual reality, and machine learning technologies.

Blockchain technology is a decentralized network of numerous peer-to-peer nodes (servers), that alleviates central servers from controlling an entire network.

Web 3.0 will enable websites and apps to process information in a human-like way, actually understanding content, therefore, making it more sophisticated and secure.  

How will Web 3.0 present new business opportunities?

Using Web 3.0, brands will be able to connect with their target audiences on a much deeper level and earn their trust much more easily, allowing highly-tailored content to reach the consumer directly from your business.

Web 3.0’s decentralized infrastructure will also make cryptocurrency and decentralized finance (DeFi) more accessible to the masses, adding a further level of consumer security and trust as it is based on peer-to-peer transactions using blockchain.

Proactively becoming educated on the latest developments in Web 3.0 by being a lifelong learner will give you an opportunity to participate in Web 3.0 once it is available and not fall behind your competitors. Continuing your knowledge base will allow you to connect with audiences better than ever, which is an invaluable asset as an entrepreneur in today’s ever-evolving technology era. 

What are the Best Startup Exit Strategies for Entrepreneurs?

As a startup business owner, there may come a time when you are ready to leave the company you have worked so hard to build. This decision could be reached for a variety of reasons, and it is not a sign of business failure but rather a calculated move that will benefit you and the future of your company. No matter what your motivation is for leaving, a startup exit strategy needs to be in place.  

An exit strategy is typically a requirement when looking for Angel Investments.  Angel Investors need to understand your potential exit strategy so that they understand when they could get paid back and the potential return on their investment.

This blog will help you determine which strategy is best for you and your company and what you should consider before implementing it

What is a Startup Exit Strategy?

A startup exit strategy is an entrepreneur’s thorough plan on how they will sell their ownership in a company as a way to reduce or liquidate their stake in the business and ideally, make a substantial profit.

6 Best Startup Exit Strategies 

There are many types of exit strategies that businesses can have and follow. We have outlined the 6 best exit strategies for startups to consider.

1. Sell to a Family Member

This strategy keeps your business within the family and brings peace of mind knowing someone close to you will do right by your vision. We often see startup owners selling their businesses to their children as a succession plan when their children have an interest in taking over.

Although selling to family or a close friend definitely has a strong appeal, be aware that sometimes things can get messy when you mix business with personal. 

You should have a solid plan on how to navigate conversations about price, timelines, and business management, as well as be prepared once the company is sold that you may disagree with business decisions your loved one has made which can inject stress into family dynamics. 

2. Merge or Become Acquired (M&A)

Merger and Acquisitions (M&A) exit strategies involve having your startup purchased by or merged with another company that has similar or aligned goals to your business. 

M&A strategies can offer a lot of flexibility in laying out terms for your continued level of involvement with the company, or lack thereof if you prefer to not have any further connection.

One of the pros of M&A is having the ability to negotiate the selling price, but one of the cons is the process can be lengthy, and sometimes, in the end, the selling company is not purchased or is not merged with. 

3. Management or Employee Buyout

Another startup exit strategy is to have employees of your company, typically managers, buy your startup. A huge plus of this option is you’ll have confidence knowing that the company’s new owners are people who already know how your startup operates therefore creating a smoother transition. 

Selling your startup to people who you know well can make the exit process more flexible and comfortable, and if you wish to remain in the loop or involved with the business they may wish to keep you on as a mentor or advisor.

4. Go Public with an Initial Public Offering (IPO)

An Initial Public Offering (IPO) is when a private company’s shares are offered to the public and serious investors on a stock exchange for the first time, opening up potential opportunities to make great profits. Typically the company hires an underwriter like an investment bank to consult on the IPO and prepare key documents for investors.

An IPO is not a route every startup business will be prepared to take or feel comfortable with, especially since going public opens up companies to a lot of scrutinies and meeting strict regulatory requirements.

5. Sell to a Third Party Buyer 

Selling your startup on the open market can be the ideal choice for many business owners. This can be a clean and clear process providing an instant successor who has a passion for your business and the qualifications to take it to the next level. 

Selling to a third party can be beneficial due to receiving a lucrative selling price and optimal sale terms, however, in many cases it can take years to find a buyer who is fully interested or that you feel confident in selling to.  

6. Liquidate 

This exit strategy is definitely the most concrete and final. When you liquidate, you shut down your business and sell your assets. This option does not mean you have given up or are defeated, but sometimes this can be the right strategy depending on your circumstances.  

Things to keep in mind are that debts need to be paid off, payouts to all shareholders need to be completed, and you need to consider how liquidation will affect your team and customers.

What should entrepreneurs consider when creating a startup exit strategy?

It is important to note that the best exit strategy for your small business may be an unwise strategy for another. However, no matter which strategy you choose to take, you must carefully consider a wide range of factors.

Questions to consider when creating a startup exit strategy:

• Does your exit strategy reflect your goals and company values? 

• How much does your startup’s legacy mean to you?

• Will your strategy make you money and what sale amount are you comfortable with?

• How will your exit strategy affect the short-term and long-term future of your business?

• What does the timeline look like for your exit strategy to complete? 

• Do you have the proper support and knowledge to successfully form an exit strategy that will benefit you and your startup?

One of the best mentors for helping with the creation of an exit strategy as well as support while going through the exit process is a startup incubator. Becoming a client of a startup incubator can benefit you and your business tremendously by receiving 1-on-1 mentorship, knowledge, advice, support, skills training, networking opportunities and more.