Vertical SaaS

Vertical software serves one industry deeply — dental practices, construction firms, restaurants, veterinary clinics — rather than serving a function across all industries.

The addressable market is smaller by definition, but competition is thinner, churn is lower, and the software often becomes the system of record for the whole business.

Core revenue is subscription, frequently priced per location or per practitioner rather than per seat.

Mature vertical companies typically add payments, lending, insurance, or marketplace revenue on top, which often exceeds the software line entirely.

• Market share within the target vertical
• Gross and net revenue retention
• Attach rate of payments and adjacent financial products
• Revenue per customer including non-software lines
• Share of the customer's daily workflow captured

The best vertical companies own a large share of their industry, have become the operational backbone of their customers, and earn more from embedded financial services than from software licences.

Net revenue retention above one hundred and ten per cent usually signals that expansion is working.

• Practice management systems in healthcare
• Field service and trades software
• Restaurant and hospitality operating systems
• Construction and project management platforms
• Vertical software with embedded payments

• How large is the vertical, and what share is already held?
• What proportion of revenue comes from payments or financial products?
• How cyclical is the underlying industry?
• What would it take for a horizontal player to enter?
• Where does growth come from once the vertical is saturated?