The High Potential of Low-Code
Today’s organizations no longer need to choose from just a few big tech companies, like Microsoft, SAP, or IBM, for apps or tools to run their business. The software marketplace is growing exponentially, giving customers more choice over who they work with and creating more competition for B2B SaaS companies to stand out from the crowd.
One increasingly common differentiator? Low-code (and no-code) solutions.
As a visual approach to software development, low-code products break down traditional silos of business by making it easier for companies to collaborate across departments with Graphic User Interfaces (GUI)—such as templates, drag and drop functions, and conversational interfaces. In fact, the potential for low-code is growing so quickly that Gartner estimates it will make up more than 65% of app development by 2024.
Low-code may seem like just another tech buzzword, but our investment team at Elsewhere believes we’ve only touched the tip of the iceberg in terms of its potential. (I think low-code is where cryptocurrency was five years ago.) For B2B SaaS startups, developing low-code solutions can drastically improve time-to-value for your product, as well as enable you to scale faster—while utilizing low-code solutions internally can streamline your own product development, as well as improve efficiencies when it comes to the apps you use.
Of course, this doesn’t mean B2B SaaS startups should jump on the low-code bandwagon without a clear vision. In this post, I’ll focus primarily on why low-code can be beneficial to B2B SaaS startups and how to strategically incorporate a low-code approach into your product.
Fuel product-led growth with low-code solutions
Pragmatic product-led growth argues that designing a product to deliver value as fast as possible—from everyone from end-users to executives—is the most efficient growth strategy. Low-code adds fuel to the fire of product-led growth: The entire cycle of how you acquire, grow, and support customers over time can be enhanced by low-code or no-code solutions.
Let’s say your product—like many enterprise apps—requires customizations using code or configuration files for customers to realize the full functionality. This approach assumes that your customers have a developer on their team, but the world is changing: Today, SaaS companies want to focus on hiring people whose skill sets are core to growth. They’ll hire developers to build products for customers, but they don’t necessarily want to hire a developer to build things internally. Organizations with less than $30M in revenue might not even have an IT team anymore, opting to outsource IT to a Managed Service Provider instead. In that case, product customizations fall on you to build.
If your team spends a good chunk of time developing customizations for customers on the back-end, then you’re a perfect candidate for launching a low-code interface. With low-code, you can productize customizations as a feature: Your customers can simply make changes themselves through a visual interface, immediately improving the time-to-value of your offering.
For example, our portfolio company Itential provides a low-code/no-code platform for network automation—empowering their customers (typically network engineers or network operations managers) to build app functionalities and customize extremely complicated workflows, even though they aren’t trained as developers.
Take a vertical approach to low-code product development
Today, almost everyone has the technical expertise to use low-code interfaces, especially in the B2B software world. When I talk about industry trends with CTO and Elsewhere OA Eric Anderson, for example, he imagines the future of software development will be almost entirely drag-and-drop—which means, in a way, that everyone will become a developer. As people’s general technical skills expand across B2B roles, niche verticals of expertise (like finance, security, and data science) are likely to narrow.
With this evolution in mind, where should B2B SaaS companies focus their efforts when it comes to low-code offerings?
Start with a specific use-case and customer type: If you’re focused on financial services, for example, build an interface for a loan processing manager at a bank. Once you have a user persona in mind, you can build low-code functionality specific to how those people think about, organize, and execute their day-to-day jobs. Then, after establishing a toehold in that vertical, you can expand into other financial services verticals.
Since low-code products focus on customization, you can’t take a horizontal approach and try to be everything to everyone. The low-code/no-code product for a financial services company is going to look entirely different from one for a biomedical research company. The most successful low-code B2B SaaS startups find success with one key persona and expand their product into new customer targets from there.
Integrate with an ecosystem of best-of-breed, low-code products
The benefits of low-code extend beyond your product and into your customer’s product ecosystem. After all, in a competitive B2B software landscape, your product’s ability to play with other products is key to your success.
Let’s say a customer wants to choose the best-of-breed products for their ecosystem, stitch them together with an API, and create a custom workflow. Typically, a custom ecosystem requires hiring developers to not only create, but also maintain, a custom setup. This process is rife with problems: It requires more development resources, creates potential miscommunication between the user’s vision and the developer’s creation, and the custom code could break during a product upgrade.
Enter low-code. Similar to how low-code enables users to customize your product, it can also empower teams to customize their workflow without having to write a single line of code: from connecting tools to building automations for certain tasks between applications. What’s more, it enables customers to pull data directly from APIs, enabling their solution to easily stay up to date as new application upgrades get released.
For example, products like Zapier provide a low-code way of changing how multiple applications work together: It automates the "stitching" that usually requires individuals to spend hours studying API docs and writing custom code. Zapier empowers users to drag and drop using “WYSIWYG” (what you see is what you get) interfaces that digest the APIs and write the code for you.
If you offer low-code functionality, your product can seamlessly integrate into the larger ecosystem of apps or tools a company is using—improving your customer’s overall experience of your product. If not, you run the risk of missing out on valuable business.
Build toward the future with low-code
As a B2B SaaS startup, you want to enable your users to get the most out of your product in the fastest way possible, while also providing them with a visually appealing and user-friendly interface. Low-code offers an opportunity to accomplish both goals.
When I talk to potential portfolio companies at Elsewhere, their approach to low-code is one of my main lines of inquiry. Thinking about low-code now is a key indicator that your company is building fast toward the future, instead of working in the past.