Until recently, I used to think that whatever software or SaaS one creates should be very novel and groundbreaking.

Now I realize that this should be far from the case when you are bootstrapped or have low capital.

What you instead want to do is carry out thorough market research and understand what kind of software companies are using.

Once you identify those, you compete within that category.

But here’s the key point: If you are non-technical or don’t have huge time or budget to allow for software development from the ground up, you have one avenue to turn to.

You go and find the best open source software in the category you are trying to compete in, and add features to it.

This approach allows you to have something in your hand that already has product-market fit, and the product development is already 90% done.

What you’re doing is adding actual value to a product and giving it to people who need it.

I used to think, “What kind of features can one even add to these open source software products?”

Of course they have many areas for improvement, but still, what can be something that one must add?

Is it AI?

But that would be very shallow, and I doubt that it would improve your product-market fit.

What one must do is go and have a good look at what that software actually does.

Then try to figure out which KPIs are emerging from it, and add features catering to those KPIs.

This is how you add actual business value to software: by sharpening their edge to deal better with the KPIs.

Businesses won’t care what features you have unless it helps them improve those KPIs—unless it helps them earn more money.

And that’s the type of arbitrage we are trying to look at.

We are looking at open source software and adding those features which will help with KPIs.

Even if we are building software from scratch each and every feature must be backing some KPI.

1. What are software for which businesses paying for already?
2. Is there an open-source version we can start from?
3. What are the core KPIs that tool is meant to improve?
4. Which features directly improve those KPIs (faster, smarter, easier)?
5. Can we make it feel premium and easier to use, not just functional?