Convert your internal business software into a product?

As your business grows and evolves, so do your software needs. Many organizations find themselves in a situation where they have developed internal software solutions to address specific operational challenges. Over time, they may consider whether to convert these internal tools into products that can be sold to external customers. While this decision can bring significant benefits, it also comes with challenges and considerations. In this blog post, we'll explore the factors to help you determine whether converting your internal business software into a product is the right choice for your organization.

Understanding the Motivation

Before diving into the decision-making process, it's essential to understand why you are considering the conversion of your internal software. Common motivations include:

  1. Revenue Generation: Developing a product for external customers can create a new revenue stream for your organization. It allows you to monetize the intellectual property and expertise embedded in your software.

  2. Market Demand: If you believe there is a market demand for your software beyond your organization, this is a compelling reason to consider conversion. Market research and validation are critical in this context.

  3. Competitive Advantage: Offering a unique software solution can give you a competitive advantage in your industry. If your software solves problems that other products do not, it may be worth converting.

  4. Scaling Opportunities: Expanding your software to external customers can allow you to scale your business and reach a broader audience. This can be particularly appealing if you have already achieved success with the software internally.

Key Considerations

While the potential benefits of converting internal software into a product are enticing, it's essential to weigh these against the challenges and risks:

1. Market Research and Validation

Consideration: Have you thoroughly researched the market to ensure there is demand for your software? Do you have a clear understanding of your target audience and their needs?

Solution: Conduct market research, gather customer feedback, and validate your assumptions before making the decision to convert. Building a minimum viable product (MVP) and testing it with a small group of external users can help validate your concept.

2. Development and Support Costs

Consideration: Converting internal software into a product may require additional development, testing, and support resources. Do you have the budget and resources to invest in these areas?

Solution: Create a detailed budget and resource plan that accounts for development, testing, ongoing maintenance, and customer support. Ensure that your organization can commit to the long-term investment required.

3. Intellectual Property and Licensing

Consideration: Have you assessed the intellectual property rights of your software? Are there third-party components or dependencies that could pose licensing issues?

Solution: Conduct a thorough audit of your software's components to ensure compliance with licensing agreements. Seek legal advice if necessary to address any potential issues.

4. Marketing and Sales Strategy

Consideration: Do you have a clear marketing and sales strategy in place to reach potential customers? How will you position your software in the market?

Solution: Develop a comprehensive marketing and sales plan that outlines your target audience, pricing strategy, distribution channels, and promotional activities. Consider partnering with experts in software marketing.

5. Customer Support and Feedback Loop

Consideration: Are you prepared to provide customer support for your product? How will you gather and act on customer feedback to improve the software?

Solution: Establish robust customer support processes and channels for users to report issues and provide feedback. Use customer insights to drive continuous improvement.


Converting internal business software into a product can be a strategic move that brings new revenue opportunities and competitive advantages. However, it's a decision that should be made with careful consideration, market validation, and a clear understanding of the resources required. By conducting thorough research, addressing potential challenges, and developing a comprehensive strategy, you can make an informed decision that aligns with your organization's goals and maximizes the potential benefits of this transformation.