SaaS or Software as a Service industry is expected to see a tremendous rise in the coming 4-5 years. According to a research report by Nasscom, it is hoped that this industry will grow to thrice its size to reach $1billion by the year 2020. And further, it is expected to cross even $50 billion in the next 10 years alone. According to this report, in this sector startups are the front runner and seem to have taken the lead. In the 150 firms in India providing these services about 50% of them are startups itself. Startups are the ones that have taken the limelight here. In 2014 alone, startups had received $170 million dollars worth of investment from 22 deals. This itself was double than 2013, which just saw 11 such deals. Investors can also smell the storm that this sector is brewing and want to grab onto their boats and sail to the top with them.

One of the major advantages that startups in India in this sector have are the engineering and product management skills that we possess. These skills alone will take these startups on to the road of success. According to the report the US and Europe are responsible for at least 80% of the demand for the Indian SaaS companies. This demand for SaaS is expected to increase due to rise in small and medium businesses in the US, so this will be an added opportunity for Indian startups to capture.

This increase in demand towards the SaaS model can be attributed to the fact that it is an economically a more viable option in comparison. This is because there are reduced amount of services and support needed from IT compared to a premise software solution.

According to Rajan Anandan, VP and managing director, Google Southeast Asia and India, "Cloud computing is one of the top technology investment trends of this decade with venture funding for purpose-built SaaS solution exceeding USD 18 billion in the last four years. Indian startups have an edge, as mobility is also becoming a key requirement by SMBs for SaaS".

With close to 8 million Small and medium businesses (SMBs) in India, this market segment presents a huge opportunity for SaaS vendors and solution providers. In conclusion, this industry seems to on the rise and will give great returns, due to increasing demand from not just within India but also from across the world and especially from the US and Europe.


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