Employee retention is critical to an SaaS company’s hopes of scaling the business and ultimately achieving hypergrowth.
Recruiting new hires can be an expensive process and takes a long time if you don’t have a specialist recruiter who takes care of it all for you. So while new hires may well be necessary as the company expands and scales-up, maintaining your workforce by retaining the talent you already have will go a long way to reducing a reliance on those lengthy recruitment processes for sustained success and growth.
Of course, it could be argued that employee retention is important for all kinds of businesses across all sectors, so why especially so for SaaS companies? Let’s look at the reasons why it is indeed especially important for SaaS firms to prioritise employee retention.
Fierce Competition for Talent
The SaaS industry has been experiencing a candidate shortage since the end of the Covid-19 pandemic. This has been compounded by a shift in candidate attitudes towards the concept of work/life balance as well as a desire to have more flexible working arrangements.
The SaaS scene is also expanding in the UK and around the world, with more and more SaaS startups every day. According to Exploding Topics there were already approximately 30,000 SaaS companies in the world at the very beginning of 2023. The UK had around 2,000 of those, with this number only having grown in the subsequent months since those numbers were published.
This highly competitive environment makes it difficult to not only find, but to then attract, the very best talent. It is clear then that ambitious SaaS companies must hold onto the talent they already have.
Improved Customer Satisfaction
An SaaS company needs to keep its customers satisfied or the contracts will soon dry up. This is where retaining employees provides another big advantage over companies with a high turnover of staff. When customers contact your company to discuss your services or a product you provide, speaking to people they already know will be a much better experience for them.
This is especially true when your employee handles a customer regularly and gets to know them and their needs. It is a relief for many customers to speak to someone they know at an SaaS company as it eliminates the need for in-depth explanations of what the customer company does and what they want. Instead, they can get straight to the point with someone who already knows what the customer company is all about.
Employee retention also reduces the chance of mixed messages and miscommunication which can arise when new hires are trying to get up to speed.
Superior Work Culture
While this reason can indeed be accurately applied to most businesses beyond the SaaS sector, it is true that a good employee retention rate will help create a superior work culture. This means employees feel valued and fairly rewarded for their achievements.
Crucially, it also means that employees have a chance to progress their careers and expand their skill sets, and there are few sectors that can compete with SaaS when it comes to skill set-expanding opportunities.
Are you looking to hire in the SaaS, tech or fintech sectors? Get in touch with our expert team here at Fairmont Recruitment.
