The Software-as-a-Service (SaaS) market is one of the fastest-growing markets in the world today. Due to the Covid-19 pandemic, its value only increased as quarantines only enhanced the consumer reliance on SaaS companies. Moreover, in 2022, three of the 10 biggest equity investments for the year were in SaaS companies.
What is SaaS?
Before we talk about the most exciting SaaS companies in the UK, it is worth mentioning what actually are Software-as-a-Service companies and what they do.
A SaaS company offers software that has a certain function or offers a certain service, often delivered to users via a cloud-based platform. It is a software licensing and delivery model which is centrally hosted and licensed on a subscription basis. SaaS companies in general, continue to upgrade and update their services in order to improve the overall user experience.
Due to the wide range of SaaS solutions in customer relationship management (CRM), human resources, social media, email marketing automation, project management, and web development, SaaS companies are present in one of the biggest industries worldwide: e-commerce, fintech, artificial intelligence (AI) and of course, big data.
The SaaS business model operates in two ways:
- Through a subscription model
- Usage-based pricing model
Consequently, there are 2 types of SaaS companies depending on who is their customer:
- business to business (B2B)
- business to customer (B2C)
In the UK today, SaaS is one of the largest ICT markets, thanks to the vast majority of businesses that realized the value of investing in newer ICT sectors in order to improve their growth. The biggest UK players in the SaaS world currently are Checkout.com, OneTrust, Synk, SaltPay, and ClearBank. The UK, as a runner-up to the US in the SaaS market, is home to over 2000 SaaS companies. This number is expected to double in market value by 2025. Even with the ongoing inflation and economic worries around the country, it is more than certain that the SaaS market will grow relentlessly in the near future and remain the frontier of the global and UK economy.
The reigning pioneer in the UK fintech market is Checkpoint.com. In the 2021 round of investments, the company raised $450 million and achieved a valuation of $15 billion. This year, the Swiss founder Guillaume Pousaz got a $1 billion investment after the fundraising valued the company at $40 billion, making it Europe’s top unicorn.
Checkpoint.com is a company that simplifies payment processes for businesses. It integrates electronic payments, fraud monitoring, and analytics into one platform. It supports dozens of payment methods used in more than 150 countries, like Mastercard, Visa, American Express, Discover, PayPal, SoFort, Google Pay, and Apple Pay. Its unified API platform speeds up the payment process, but also allows its users to record and analyze financial data. The unicorn processes payments for some of the most known giants worldwide: Netflix, H&M, Pizza Hut, Farfetch, and Coinbase.
The UK SaaS market is the current hotspot for tech innovations. In 2021, almost a quarter of UK equity funding went to UK SaaS startups. Companies that were previously not involved in the SaaS world are rapidly upgrading and improving their services because of their obvious demand and success. For instance, the impact can be seen in the SaaS SEO Agency, AWISEE which is rapidly growing in the UK and Wales region. While all the big companies in the UK have already applied adequate tools for their success, small and medium-sized enterprises have also started to shift their focus toward the proper digital tools that will certainly improve and upscale their services.