While rumblings of recession risks continue to captivate headlines, the US employment landscape has, in reality, never looked better. With the unemployment rate of 3.4% now sitting at 50 year lows and new business starts up over 40% since 2019, business owners across industries today are feeling a renewed sense of urgency when it comes to delivering greater operational efficiency, transparency, and customer delight in the race to keep pace with the accelerating competition around them. Enter vertical SaaS. Over the past several years, a Cambrian explosion of vertically focused companies have emerged aiming to transform the last bastions of pen and paper, fax machines, and error-prone manual tasks that can not only be done better but also faster and cheaper through technology. We’re excited about the potential for these companies to revolutionize the way that work gets done across a broad base of multibillion, if not trillion, dollar industries.
In this series, we unpack the “what,” “why,” and “how” defining this generational shift as well as our perspectives on the category after studying it closely over the last several years. In this first post, we’ll share our perspective on what classifies as vertical SaaS (and, importantly, what does not), why we’re excited about the category, and a market map of the current landscape. In future posts, we’ll dive into why we believe there has never been a better time for vertical specific solutions, what common traits we’ve seen from the winners, and what we’ve learned from category breakouts.