What is “SaaS” Meaning?

SaaS, short for Software as a Service, is a cloud computing model where users access applications through the internet, typically by paying a recurring subscription. Instead of installing software locally on their devices, users rely on providers to host and maintain the software on remote servers.

This model has become dominant in digital business due to its scalability, automatic updates, and lower upfront costs. It supports remote work, team collaboration, and access from multiple devices.

Example

"Slack, Notion, and Google Workspace are all SaaS products designed to boost productivity and collaboration through the cloud."

How is “SaaS” Used in Business?

In modern digital business, SaaS is used to streamline operations, reduce IT overhead, and provide employees with accessible, user-friendly tools. Startups often build SaaS platforms for recurring revenue, while enterprises adopt SaaS to improve efficiency and reduce maintenance demands.

Pro Tip

When launching a SaaS product, focus on user retention and onboarding. Your pricing model, UX design, and customer support all directly impact growth.

Related Terms

Subscription Model, Cloud Computing, Churn Rate, Monthly Recurring Revenue (MRR)