Dear SaaStr: How Do You Handle Customers That Want to Build It In-House?

Be “Cool”.

What I mean is, we all go through this, at least, a lot of us.

When you first build a start-up, it’s often feature-poor, with little-to-no brand. Internal IT teams sometimes think they can built it themselves.  And we’re even seeing a bit of renaissance here again, as many try to build apps on ChatGPT and OpenAI themselves instead of through an established, pre-AI vendor.

And perhaps they can — today.

  • But then they’d have to maintain it.
  • And iterate on it.
  • And keep it current.
  • And ultimately, be competitive not with just your offering as it is today — but how it will be over the course of the next 5–10 years.

Once you are established, once you have a brand … most of your prospects and customers will know they can never commit the long-term resources to “competing” with the 200–2000 releases and updates you’ll do over the coming decade. The millions, and then tens of millions, and then hundreds of millions you’ll spend annually on R&D.

Until then, “building ourselves” is a valid alternative to a new, very simple product from a new vendor

So …

Tell them you’ll support them either way, that you are committed to innovation. And close them on whatever deal you can now.  

Odds you lose them later to an internal offering, if you out-innovate and out-hustle their internal team?


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