As a SaaS company owner and an investor through Ramp Ventures, I’ve always got my ear to the ground when it comes to future trends.

And although there’s no way to predict with 100% accuracy what the upcoming year will bring, the following are a few of the trends I’m keeping an eye on in 2020:

Trend #1: A focus on sustainability

A recent SaaStock article shared the following quote from Hanno Renner, CEO & Co-Founder, Personio:

“I think the biggest trends we’re currently seeing is that while growth remains important (especially at scale) it also gets more and more important to look at your metrics and remain profitable as we grow. Both from a growth margin but also from a customer acquisition perspective.”

I’m thrilled to see this idea gaining traction. I’ve been writing about the need for sustainability in growth since at least 2016, despite huge pressure at that point for companies to focus on scaling at all costs.

That said, given that $100M+ equity financing rounds continue to increase – according to data shared by Sapphire Ventures – it’d be pretty naive to assume that founders and investors are going to suddenly back off on aggressive growth in order to focus on profitability and other sustainability metrics.

But I’d still call it a win if even a small handful of startups take on this trend and decide to run with profitability as a north star in 2020. We’re all better off when growth is built on a strong foundation.

Trend #2: Specialization and differentiation

According to Blissfully’s 2019 Annual SaaS Trends Report, the average company spent $343,000 on SaaS in 2018 – a 78% increase from the previous year.

This kind of dramatic growth has only been possible because so many new products have entered the market in the last few years, and I don’t see that trend slowing down any time soon (barring major changes in the US economy, of course).

The natural response to these increased entries, in my opinion, is going to be specialization and differentiation, in terms of utility, features, audiences or verticals.

When competition gets tougher, only those products that can clearly define a specific value proposition for a single audience and that can differentiate themselves from others are going to thrive.

Trend #3: Platform development (PaaS)

An alternative to serving a tightly-defined audience with a differentiated USP is to become a company’s “go to” platform for multiple needs.

Perhaps that’s why Linchpin SEO predicts growth in platform-as-a-service (PaaS) in 2020, writing that:

“PaaS focuses on allowing clients to create or purchase add-ons to the product that they initially bought. Doing so allows SaaS/PaaS providers to offer clients a much more personalized approach to their client’s needs, which should encourage their growth rate and customer retention.”

The challenge here is that building a platform is harder than building a single solution tool – and it isn’t appropriate for many SaaS startups. If you haven’t hit product-market fit, for example, you’ve got more fundamental underlying issues to resolve before you start worrying about developing platform capabilities. – Read more

Cloud adoption is rapidly increasing as businesses search for new ways to store, distribute, and manage their data. Multi-cloud might just offer the advantages that enterprises are looking for.

According to recent research by IBM, 85% of enterprises are already operating in multi-cloud environments. It gives an answer for the question is it worth to migrate to cloud? Additionally, those that are not using multi-cloud are planning to do it soon. This number can tell you one thing, if you are yet to implement a multi-cloud strategy for your business, you better do so.

But first, what is a multi-cloud approach? Multi-cloud is the use of more than one cloud computing and storage service in one architecture. This approach involves distributing software, applications, assets, among others, in several public cloud-hosting providers.

The Difference Between Multi-Cloud and Hybrid-Cloud

In some cases, multi-cloud and hybrid-cloud have been used interchangeably, which may be confusing. However, they are different. In a multi-cloud approach, an organization utilizes multiple public cloud services offered by various providers. Enterprises may sometimes use numerous public clouds along with their on-premises IT ecosystem and private cloud infrastructure. Hybrid cloud, however, refers to a combination of both private and public clouds. The main differences between the two are:

Multi-cloud must include multiple public clouds while a hybrid cloud is a combination of both private (on-premises) and third-party public clouds.

A multi-cloud strategy involves using different clouds for different workloads. There is no connection between these workloads in a multi-cloud environment. As for hybrid cloud, data as well as processes work together or co-relate.

Advantages of Multi-cloud

Multi-cloud technology presents an array of benefits to enterprises. Let’s take a look at some of them.

Minimized Risk of DDoS Attacks

DDoS attacks are a real threat to any enterprise with all resources that power its site on a single cloud. According to a Rand Group survey, one hour of downtime can cost 98% of firms an excess of USD 100,000.

With such a substantial loss probable at any time, it makes sense for a business to adopt the use of a multi-cloud resource to power its site. Here is why. This tech will make a website more difficult to bring down since in case a single cloud is compromised, others can ensure that it is still available until appropriate remedies are put in place.

Freedom of Choice

Cloud-hosting providers rarely meet all of an enterprise’s demands, for example, size, speed, etc. However, with a multi-cloud approach, a business can assign various aspects to different providers based on their abilities. In turn, this will boost the performance of the enterprise.

Avoids Vendor Lock-In

Vendor lock-in happens when a business outgrows its cloud provider, making it hard to sustain the current requirements that it offers to its clients. By restricting your venture to one cloud provider, you risk this happening Allow your idea to exceed your wildest imaginations when it comes to growth. However, when you work with multi-cloud providers, you can maintain operations even if your enterprise scales up fast.

There are many other benefits of adopting multi-cloud approaches. More flexibility and reliability, costs optimization, improved data management, and the ability to offer services without necessarily being good at them are some more advantages.

Disadvantages of Multi-Cloud

Like in a case with many other things, there is a flipside to multi-cloud. Firstly, is that it can be quite challenging to control when compared to adopting a one-cloud approach. Secondly, if background checks are not done on the part of providers, a business can be susceptible to security breaches.

How to Start a Migration to the Cloud

Are you ready for cloud migration? The best place to start is by finding a nearshoring partner who provides cloud transformation services. The vendor should have the know-how as well as experienced specialists. With these, you can count on the success of a cloud migration project. To conclude, cloud services outsourcing can be very cost-effective since, when done correctly, there won’t be a need to hire other vendors in the future. – Read more