Software-as -a-Service (SaaS) is no longer just a convenient way to access software through the cloud. In 2026, the software-as-a-service business model is now the very backbone of how modern businesses operate and scale. In fact, data tells us that SaaS and enterprise software companies have raised about $4.7 billion in investments in 2024.

In this guide, let’s break down how the SaaS business model works, why it continues to dominate the software industry, and what has changed leading into 2026.

What Is SaaS?

SaaS is a delivery model of centrally hosted software that is licensed to customers via a subscription plan. If a company leases its software through a central, cloud-based system is technically a SaaS company. 

These companies maintain responsibility and oversight of servers, databases, and any relevant software that allows people to access and use their products.

Some of the most popular SaaS giants in 2026 include:

• Adobe
• Google Workspace
• Salesforce
• Microsoft 365
• Notion
• Canva
• OpenAI
• Grammarly

In 2026, SaaS applications are often enhanced by built-in AI capabilities, such as in the cases of OpenAI, Grammarly, and many others.

The way that SaaS companies lease their product is through subscription plans. These plans can vary greatly from company to company. SaaS business models offer different services and different applications within their systems. Different subscription plans give different access to different services. Many offer a regular plan with one or two other plans that offer more access and increased services. 

What Is The Software As A Service Business Model?

The software as a service business model includes a number of factors that are unique to it. There are three in particular that are important to take note of. 

Recurring Payments

In SaaS, clients do not buy hardware. The software as a service business model involves providing a subscription service for software. Recurring payments typically take the form of Monthly Recurring Revenue (MRR), though many SaaS companies now track additional metrics like Annual Recurring Revenue (ARR), Net Revenue Retention (NRR), and expansion revenue.

When your customer signs up and subscribes, you will get some money upfront. It is imperative that this initial cash not be counted as revenue until it’s been properly earned. It is a liability until the terms of service have been completed. A customer can ask for that money back at any point if the service isn’t delivered.

Revenue recognition is one of the most fundamental aspects of running a successful SaaS company. Alongside subscriptions, SaaS companies also monetize through usage-based pricing, AI consumption pricing, or hybrid billing models that combine multiple approaches.

Heightened Customer Retention

All businesses care about customer retention. In SaaS business models, however, it is ten times more important. Customer retention is what keeps SaaS companies afloat. Because you cannot lay claim to all of your customers’ subscription money until the term of service has been completed. 

If you sign a customer for one year or twelve months and they leave after two, then you’re without ten months of recurring revenue. As a result, it is critical to put a significant value on cultivating customer relationships and upselling. 

An existing SaaS customer spends more money on average than a new one. It is in a SaaS company’s best interest to upkeep and maintain higher-quality customer service. If you don’t, or if the quality of customer service is poor, your customer is very likely to jump to a competitor. 

No matter how great the product, poor customer service can break a company. 

Consistent Updates

SaaS companies must continuously release updates, security patches, AI model improvements, and new automation capabilities to stay competitive and retain customers. Plenty of companies provide “next-gen” product versions, but SaaS has to continuously update and patch to stay above water. 

This is now standard across modern cloud software, where continuous deployment and rapid feature iteration are expected by customers. Software vulnerabilities can put customer information at risk from hackers. Nobody wants that. That’s why continuously assessing and updating security fixes is a top priority in the software as a service business model. 

Since SaaS companies host their own products, they can push updates as needed. They can release new features or enhance prior versions whenever they want. Between consistent updates and quality customer service, SaaS companies have the potential to be highly responsive to customer base feedback. 

This is a real-time luxury that most other industries do not have. 

How Are SaaS Companies Built?

Generally speaking, there are three critical stages as to how to build and develop a SaaS company: Setup, Growth, Stabilization. 

Setup

This is the early stage where the company establishes its foundation. These are fairly typical processes. Founders discover the need for the products they intend to develop, identify their target market, and create the product. 

This is also the opportunity to create an effective marketing campaign and sales strategy, consider various customer support plans, and organize finances. 

Growth

Once the product has hit the market, it’s time to expand. This is arguably the fun part. Because there is seemingly no limit to how far a SaaS company can expand in its market, it’s possible for a SaaS company to expect new customers. This creates a sudden demand for marketing, sales, and customer service teams. 

This is when a company has to act quickly in order to capitalize and secure a loyal customer base. Ideally, this growth will be accompanied by additional revenue. Companies then reinvest the capital back into their products and services. That way, they have the resources necessary to meet their customers’ needs. 

Stabilization

Now that the business is beginning to acclimate with a steady incoming stream of customers, that means the company does not have to invest in more overhead. If the SaaS company has wisely invested in customer service software, marketing automation, and consistent product updates, it is on the right track to stabilization. 

Why This Business Model Works

The SaaS business model is now a mature and dominant software delivery standard across nearly every industry. You can find the evidence of this in the vast investments in SaaS. How many office spaces use Slack to communicate? How many designers use Adobe? As our technology advances, so does the SaaS industry. 

While the SaaS market remains full of opportunity, success in 2026 requires strong differentiation, AI integration, and clear customer value.

Featured Image Credit: Photo by Markus Winkler from Pexels

Nowadays, many of our tasks at work can be completed with a single click. However, there are still software solutions that offer more: they can automate everything and provide crucial data to help your business grow. Here are the ten best artificial intelligence solutions you should be exploring now.

1. IBM Watson Studio

IBM Watson has been a trusted name in technology. It even garnered attention when it guest-starred on Jeopardy! But IBM Watson is now within reach for businesses with the IBM Watson Studio. This is one of the most utilized artificial intelligence solutions that financial and medical institutions could use.

Features:

• Build model pipelines
• Refine data with a graphical flow editor
• Visual tooling
• Open source framework
• Model embedding, monitoring, and management
• Data access through the cloud
• AI model drag-and-drop
• Transaction details
• Lifecycle automation

2. Salesforce Einstein

If you need to optimize your CRM tasks, using Salesforce Einstein is your best bet. If you want to get more leads and nurture them, Salesforce Einstein helps you understand them better through deep insights. Plus, you don’t have to do the guesswork anymore. Einstein will help you understand the next steps when nurturing leads and converting them into customers. Not to mention, Einstein can also help you with customer service.

3. Edgeverve ExtractEdge

Optimize your business process with Edgeverve ExtractEdge. Previously known as Infosys Nia, your business will have a much more efficient way in processing documents. One of its benefits is getting intelligence from documents. From there, they process the data and help enterprises and businesses with their productivity and decision-making processes. Two industries that can greatly benefit from this artificial intelligence solution are banking and insurance.

4. Azure Machine Learning

Get things done faster with your own frameworks and models through Azure Machine Learning. This artificial intelligence solution is ideal for data scientists and software engineers to automate and streamline several business processes using Machine Learning. Here are some of their notable features:

• Data labeling
• Collaborative notebooks
• Drag-and-drop machine learning
• Responsible machine learning
• Model registry and audit trail
• Managed endpoints
• Interoperability with other Azure services
• Data preparation
• Automated machine learning
• Reinforcement learning

5. H2O AI

H2O AI is one of the most utilized artificial intelligence solutions because it is jam-packed with features. Not only that, H2O AI can be used by industries or institutions like financial services, governments, health, insurance, manufacturing, marketing, retail, and telecommunications.

With H2O AI, you can ensure that you can build accurate models quickly. Plus, they’re also transparent! You can also analyze business performance and know how to adapt to changes. Plus, you can become an innovator in your field!

Under their Make, Operate, and Innovate approaches, here are their platform’s capabilities:

• Feature Transformation
• Machine Learning
• Explainable AI
• Low Code App Development
• Machine Learning Operations
• AI AppStore

6. Coro

If your business is prone to cyberattacks or cannot afford to have a cyberattack, artificial intelligence solutions can protect you from that. One of them is Coro. Coro ensures that your company is protected from any hacking or malware infecting your emails, devices, and cloud apps! Aside from protecting you, Coro will alert you on your next steps to ensure you’re safe.

7. Vertex AI

Vertex AI is Google’s own machine learning and AI platform. You can train and deploy your AI or machine learning models. Plus, you can also do the following:

• Data Labeling
• Feature Store
• Workbench

You can launch your models through the Google Cloud, and you can access or view data anytime through Cloud Logging and Monitoring.

8. Rendered.ai

For your autonomous systems, defense applications, or advanced computer vision needs, there’s Rendered.ai. It specializes in generating physics-based synthetic datasets that make it easy for you to train AI models when real-world data is scarce, unavailable, or impractical.

• Autonomous Vehicles and Robotics – Simulate rare driving situations that are too costly or dangerous to see in real life.
• Defense and Aerospace – Can generate synthetic radar, infrared, and multispectral data for training AI models for mission-critical environments.
• Healthcare Imaging – Can create synthetic X-rays to improve diagnostic AI systems

9. Tealium

Marketers rejoice, Tealium is an artificial intelligence solution to optimize your marketing campaigns. Tealium ensures that you can grow and acquire your audience! They do it through segmentation and audience insights. But it doesn’t stop there. The AI solution also helps you with loyalty, retention, customer experience, and personalization. Other solutions are:

• Predictive insights and customer analytics
• Data collection and privacy
• Single view of the customer
• Operationalizing mobile data

The industries that can greatly benefit from Tealium are:

• Finance
• Healthcare
• Pharma
• Retail
• Sports & Entertainment
• Travel & Hospitality

10. Sisense

Here’s another business processing AI solution to help your business operate smoothly. Sisense will help you learn more about your company from every department. If you’re running marketing campaigns, Sisense can analyze them and improve your ROI. You can also get data to improve performance. Plus, you can mitigate risk through analytics.

Final Thoughts

Artificial intelligence solutions can streamline business processes, create models for data scientists and software engineers, and analyze data. With AI’s help, you can increase productivity and get more value for your business.

This article focuses on OpenStudio.one, an all-in-one business management suite, not the OpenStudio building energy modeling software developed by the U.S. Department of Energy.

We all need a service that makes business easier, right? Managing your team, your finances, your documents, and your customers can be an arduous juggle. There are a few services out there that help businesses manage all of this.

But have you heard of OpenStudio? No? Well, allow us to make a proper introduction. 

OpenStudio helps you centralize all the applications and services you may need in order to run a business. 

This app prides itself on helping businesses “save money and countless hours of development,” giving them easy access to all the business tools they need in one platform.

Some of the top features offered by OpenStudio are necessary in order to run a business, but haven’t necessarily been rolled into one package.

OpenStudio offers the following features: 

• Administration
• Cloud & Benefits
• Data & Records
• General Services
• Human Resources
• Support

This app also offers IT protocol and documents management, permissions and authorization management, and digital signing of documents.

If you’re looking for a tool that will help you centralize the apps, applications, and services you regularly use, OpenStudio is worth checking out.

The best part? Using this tool is completely free as of the time of writing in 2026, without the need for a credit card to register. The website says they may introduce advanced paid plans in the future.