From Agency to Product: Turning Services into SaaS on Purpose

Agencies are underrated SaaS incubators. Belkins taught me that almost every painful, repeatable service hides a product. The trick is productizing on purpose.

1. Why agencies are perfect SaaS laboratories

In an agency:

• You touch many similar customers

• You see the same problems over and over

• You feel operational pain before the market does

That’s gold.

Instead of guessing what to build, you’re getting punched in the face with real constraints every day.

2. Signals a service should become a product

The patterns I watch for:

• Repetition: same workflow across many clients

• Pain: team complains about it constantly

• Value: solving it unlocks obvious, measurable ROI for clients

• Defensibility: it relies on data, process, or expertise that isn’t trivial to copy

If something hits all four, I stop and ask, “Are we accidentally sitting on a product?”

3. The productization path: from internal tool to SaaS

I like a staged path:

1. Internal tool

   • Build the minimum system that makes your team’s life easier.

   • No login, no billing—just usefulness.

2. Packaged service

   • Wrap that tool in a clearer offer.

   • Sell it as “X” with a fixed price and outcome.

3. External product

   • Add self‑serve UX, onboarding, documentation.

   • Start selling it outside your agency base.

The mistake is trying to jump straight to step 3.

4. Avoiding cannibalization and internal war

When you productize inside an agency, people get nervous:

• “Will this kill our services?”

• “Who owns revenue now?”

My rules:

• Be explicit: the product exists to augment services, not replace them (at least early).

• Create separate P&Ls as soon as possible.

• Give someone clear ownership of the product with permission to say “no” to custom work.

Services are your distribution. Product is your leverage. Don’t turn them into enemies.

5. Org design: who does what

At first, the product team is tiny:

• 1 founder / PM hybrid

• 1–2 engineers

• 1 designer or UX‑minded dev

The agency team:

• Feeds insights and bugs into a shared backlog

• Gets priority on fixes, because they’re paying with real pain

• Becomes your first “customer advisory board” whether they like it or not

Over time, I split:

• Separate standups

• Separate roadmaps

• Shared goals around revenue and retention

6. Founder questions before you spin up “yet another product”

Before you decide to “build SaaS from our agency,” ask:

• Are we solving a problem we deeply understand?

• Would at least 5–10 of our existing clients pay for this separately?

• Can I see a world where this has its own brand and website?

• Do we have one person who will wake up owning product success?

• Can we afford 12–18 months of investment before it becomes self-sustaining?

The more “yes” you get, the less it’s a vanity product and the more it’s a real business.

I write more about this agency → product path in my newsletter and share ongoing experiments on LinkedIn, so if this resonates, that’s where I unpack the details over time.