Definition of the SaaS Business Model: A Unique Business Architecture by Lincoln Murphy of Sixteen Ventures. The SaaS Business Architecture is a network-centric commingling of Marketing, Intellectual Property, Technology, and Business Model.

1. SaaS Business Model:
A Unique Business Architecture
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2. Conventional SaaS Definitions
“a model of software deployment
“…software that’s developed and hosted
whereby a provider licenses an application
by the SaaS vendor and which the end user
to customers for
customer accesses over the Internet. ”
use as a service on demand.”
- CIO.com
- Wikipedia
“…subscription based, and all upgrades are
provided during the term of the subscription. […]
is hosted and updated on a central location, and
does not reside on client computers.”
- Utah.gov
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3. Problem...
Most conventional definitions of
SaaS are meaningless to vendors
and result in industry-wide
misunderstandings and confusion
http://saasbusinessarchitecture.com Copyright© 2009 Sixteen Ventures / Lincoln Murphy. All Rights Reserved

4. Solution...
Stop trying to fit legacy
Eliminate legacy artifacts and
models into a modern
start with what works
model
Clearly delineate SaaS and its Introduce the SaaS Business
defining characteristics Architecture
http://saasbusinessarchitecture.com Copyright© 2009 Sixteen Ventures / Lincoln Murphy. All Rights Reserved

5. SaaS Business Architecture
Intellectual
Marketing
Property
The SaaS Business
Architecture is a Network-
Network centric commingling of
Centricity Marketing, Intellectual
Property, Technology,&
Business Model
Technology Business Model
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6. Marketing
Unique value proposition for
Inherently Social
both vendor and clients
Reduce barriers to
Self-Service focus
adoption
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7. Intellectual Property
Core Application Proprietary Functionality
Cannot be the only focus of Create value beyond the
developers core application
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8. Technology
Self-Service, network-
Single Instance, Multi-Tenant
centric, and ecosystem
in Production
focused
Forking code for one-off
clients breaks the model; Web-native, UI agnostic
inbuilt flexibility is key
http://saasbusinessarchitecture.com Copyright© 2009 Sixteen Ventures / Lincoln Murphy. All Rights Reserved

9. Business Model
Metering, Billing internal to
Inbuilt Revenue Model
Application
Leverages many of the 7 Should be driven by quest
Revenue Streams available for Business Scalability
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10. 7 SaaS Revenue
Streams
Products
Subscriptions Ecosystem
Network
Effect
Services Advertising
Ancillary
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11. Network Centricity
Producers Consumers
Network
Effect
Ecosystem
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12. Get the detailed guide to the
7 SaaS Revenue Streams with examples:
http://saasrevenue.com/7streams.html
If this is a SaaS Revenue Model emergency
put down the mouse and call us:
(972) 200-9317
Copyright© 2009 Sixteen Ventures / Lincoln Murphy. All Rights Reserved