Point solution 

small boy stuff

Author

Stan Rymkiewicz
June 12, 2023

Welcome to the Category Surfers where we break down go-to-market strategies so you can build the best growth engine for your SaaS.

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Don’t build a point solution, if…

Most SaaS companies start by solving one core problem well. And becoming a point solution.

The focus. The speed. The resources. All things work together to build one product that is better than the competition.

If all goes well, a company raises series B and starts to add more products and caterers to more use cases.

The focus, speed, and resources

They get diluted into improving the current product while trying to make more bangers.

Unfortunately, most companies fail on both ends.

They can’t improve the main product with the same discipline as in the early days, and the secondary products are not as good as competing point solutions.

This is where the company will do layoffs, transition into a margin-led model and try to get acquired by a private equity group. These “start as a point solution and then expand” rarely get to the IPO stage.

Don’t get me wrong

If you want to build a small SaaS — I think that could be a great strategy.

But the data suggests that you actually need to build a platform use case from the early days.

Examples

Take a look at these. All great, growing large companies.

  • Oracle

  • Salesforce

  • Workato

  • Rippling

  • Hubspot

  • Qualtrics

They all started as a platform first. The goal was always to build a layer of record, action, or intelligence — not solve ONLY one problem for the customer.

Lesson is…

If you want to build the next Salesforce you need to build a platform

And same goes for the opposite. If you just want to raise a small round or bootstrap then sell for a few million, don’t build a platform.

Thank me later, with stock (ideally).

That’s it!