The Second Edition of Parachute Advisory's Steps to Mastering Embedded Payments for SaaS Growth

Tip 2 - Building a Skyscraper: Driving Continuous Growth in Vertical Software

In the world of vertical ISVs, the difference between good and great often lies in the ability to build upon existing offerings, much like constructing a skyscraper floor by floor. Each new product or service is like adding a new floor to the foundation, enhancing the company's capabilities and market presence.

Take Veeva Systems, a standout in life sciences software. They began with CRM solutions for pharma sales reps and then expanded with Veeva Vault, targeting research and clinical operations. This expansion has been like adding new floors to their skyscraper, driving continuous growth and propelling Veeva to nearly $2 billion in revenue with a consistent 30% annual growth rate.

Top takeaways for vertical software CEOs:

1. Listen to Customers: Use advisory boards, surveys, and direct feedback to understand and solve customer business problems, not just your perception of them.
2. Follow the P&L: Identify opportunities to increase revenue or reduce costs for customers.
3. Learn from Competitors: Offer integrated, superior alternatives. Work with SMEs or consultants to guide your path, avoiding pitfalls where others have learned the hard way.
4. Cross-Pollinate Ideas: Look at other verticals for inspiration on cross-selling.

Let’s note Wix as an example, a company who listened to their customers and learned from competitive offerings. Wix initially provided website building tools, their merchants can choose to process credit cards through one of Wix’s many payment partners, and the company also has its own payment solution—Wix Payments.. By offering a proprietary payment solution, Wix not only integrates its services but also captures additional revenue through transaction fees. This approach allows merchants to consolidate their website, eCommerce, and payment solutions under one platform, enhancing customer convenience and loyalty.

As companies scale, maintaining focus is essential. Initially, prioritize one new "floor" at a time. Once reaching significant scale, ensure each product has dedicated owners and teams, as seen with Veeva's "two in a box" model.

Embracing this skyscraper-building strategy not only secures a company's growth trajectory but also solidifies its position as a market leader.

Connect with Parachute Advisory to get the full guide and unlock the remaining steps and playbooks. We will continue to share tips, so stay tuned!

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