The Evolution of Vertical SaaS: What We Heard at Collective Live 2025

This November in San Francisco, we convened more than 200 Vertical SaaS CEOs and founders for Tidemark’s second VSaaS Collective Live. Leaders from 17+ industries — spanning restaurants, construction, legal, travel, insurance, beauty, automotive, and more — came together from 4 continents to compare notes on what it actually takes to build durable vertical software companies today. Collectively, the room represented more than $4B in ARR.

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The conversations at Collective Live traced the same arc we use at Tidemark to understand how great vertical software companies scale: win your market, expand your influence, and extend through the value chain. Threaded through all of it was AI, which is reshaping cost structures, operating models, and the speed at which companies can move from product to platform. We heard both concrete examples of established SaaS companies making the agentic transition, and lessons from native AI companies operating at a fundamentally different level of efficiency.

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How Vertical SaaS Companies Are Winning Their Markets Today

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What surfaced clearly at Collective Live is that how companies win their markets is becoming more structural — shaped by who controls decisions, who bears risk, and how economics actually flow.

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Kevin Hamilton (Former CMO, Toast) opened the day with a session on designing GTM flywheels that compound where he emphasized a core principle of “strategy first, tactics second.” Rather than chasing channels or campaigns, Kevin focused on aligning distribution, pricing, and operating cadence around a clear strategic thesis, so growth becomes repeatable rather than episodic.

That theme carried into a panel moderated by Rob Lopez (CEO, AccessiBe) with Matt Rosenthal (CEO, Sewer AI), Quinn Litherland (CEO, Revin), and Mike Greene (CEO, HiMarley), which focused on what it actually takes to sell AI into the enterprise. The discussion centered less on features and more on buyer behavior including how teams reduce perceived risk, establish trust, and guide customers through adoption in markets where the cost of getting AI wrong is high.

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In a separate breakout, Dave Yuan explored how private equity firms are increasingly functioning as a real go-to-market channel — not just as buyers, but as distribution partners who can accelerate category penetration when teams speak in the language of investment math and value creation.

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Across those conversations, a common pattern emerged: the strongest teams are turning unit economics into growth loops, not one-way spend. Winning today is less about perfecting a single motion and more about designing a system that compounds.

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Rewriting the Vertical SaaS Value Chain

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Once a company has won its core workflow, the bottlenecks move. At Collective Live, we intentionally spent time on what happens next: how vertical software companies are extending through the value chain to take on work that no single participant fully owns today.

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Those challenges rarely sit inside one team. They show up in the handoffs between teams, companies, and stakeholders: lenders and builders, insurers and shops, hoteliers and distribution channels, advisors and their end customers. Addressing them requires more than incremental feature expansion; it requires new ways of organizing the business itself.

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To bring this to life, multiple sessions focused on the new business archetypes we’re seeing across supplier extensions, consumer extensions, Business-in-a-Box offerings, and industry ledgers. Each represents a different path to extending responsibility, ownership, and economic impact beyond a single workflow.

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• Some, like Chase Gilbert (CEO, Built), started upstream with the stakeholder who controls capital, then built outward into owners, operators, and suppliers on a shared industry ledger.

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• Others, like Marc Fredman (Former CSO, CCC Intelligent Solutions), shared how CCC evolved from narrow workflow tools into the connective tissue of an entire industry’s claims, parts, and diagnostics economy.

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• In travel, Sankar Narayan (CEO, SiteMinder) pioneered a shift from “helping customers run operations” to “helping them get revenue” by owning distribution and demand, not just back-office tooling.

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• And in a fireside with Dave Yuan, Evan Frank (CEO, Fora) and Kamau Massey (CEO, Moxie) discussed how Businesses-in-a-Box bundle software, services, and demand to sell outcomes rather than tools — turning growth into a closed loop where unit economics and customer value reinforce each other.

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The pattern was clear: the next defining platforms in vertical markets aren’t extending for breadth. They’re extending to take responsibility for the work that happens between stakeholders including the handoffs, dependencies, and economic seams no single participant owns today. The companies that step into those gaps become hard to dislodge because they absorb complexity others can’t…or don’t want to.

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AI is the Accelerant Across the VSaaS Journey

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Across the sessions, a consistent picture emerged of how AI is actually showing up inside vertical software companies. 

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As John Foreman (CPO, Clio) put it, work increasingly breaks down into judgment and toil. AI’s role is to absorb the toil so humans can focus on judgment, but only when AI is embedded across product teams, not isolated in a specialist pod. When that happens, companies stop shipping “AI features” and start redesigning how work gets done.

As engineering velocity increases, AI also shifts where the real bottlenecks live. Constraints move downstream and into product marketing, pricing, enablement, implementation, and customer adoption. The companies pulling ahead are recognizing that faster R&D doesn’t help if the rest of the organization can’t keep pace, and are reshaping their operating models accordingly.

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The result is a compression of the VSaaS journey itself. AI doesn’t change what it takes to build a great vertical software company, it collapses the time, cost, and organizational distance between winning, expanding, and extending.

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A quieter but equally important theme across the keynotes was that the biggest impact of AI so far isn’t autonomy, it’s economics. As Tim Barash (CEO, Dutchie & former CFO, Toast) and Henry Shi (Founder, LeanAI Leaderboard & Super.com) discussed, the $1M ARR-per-employee benchmark is no longer theoretical. It’s starting to appear in companies that reorganize around AI-native workflows instead of bolting AI onto yesterday’s processes.

The Next Generation Is Expanding by Depth

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A final thread ran through nearly every session: the strongest companies keep picking up work the market routinely drops. Scope is expanding not because founders lack focus, but because customers keep asking platforms to take on more responsibility.

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That increasingly means handling onboarding instead of selling onboarding software; running marketing rather than providing templates; managing budgets and capital flows rather than monitoring them; bringing demand instead of simply processing bookings; and coordinating multi-party work instead of digitizing individual steps. The companies that lean into those uncovered jobs continue to reinforce their Control Point (see System of Action —  Part 2: Replacing Cousin Richie).

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The State of Vertical SaaS in 2025

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This year’s keynotes describe a market that has crossed a structural boundary. 2025 and beyond isn’t about Vertical SaaS digitizing industries anymore. It’s about helping those industries reorganize and becoming the operating fabric where work, money, and decisions meet.

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Thank you to all the speakers, attendees, and partners who made VSaaS Collective Live 2025 such a success. The quality of the discussion this year reinforced why this community truly matters, and why we’re already hard at work on planning 2026 now.

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Sign up here to be among the first notified when our 2026 date is announced. Be on the lookout for full session deep-dives in the coming weeks.