Practice by Numbers leveraged its position as a data analytics layer to launch an integrated payments product. By seeing customer transaction data, they identified a $2 billion GMV opportunity within their existing customer base, creating a highly profitable new revenue stream by moving into the flow of money.

Gokul argues that single-function tools in a vertical have a limited ceiling. To achieve a decacorn valuation, vertical SaaS companies must aim to own the entire software stack for their niche, like ServiceTitan with its 30+ products for field services.

Horizontal SaaS companies fracture their customer knowledge across diverse industries, forcing generic messaging. Vertical SaaS companies build compounding knowledge with each customer within a niche. This leads to deeper insights, stronger competitive secrets, and more effective, specific messaging over time.

The SaaS-era advice to "do one thing well" is outdated and risky in the current AI climate. The best defense against rapid displacement by competitors or platform shifts is to build a multi-product bundle. This strategy creates a wider surface area within a customer's workflow, increasing stickiness and defensibility.

Practice by Numbers began as an analytics layer on top of core dental PMS. They strategically expanded by building solutions for all adjacent needs (payments, phones, booking), creating a comprehensive "practice in a box" that simplifies the tech stack and dramatically increases customer value.

The founder of Practice by Numbers envisions shifting from selling software to selling outcomes, potentially charging a percentage of a dental office's revenue. This aligns the company's success directly with its customers' financial performance, transforming the relationship from a vendor to a true growth partner.

Practice by Numbers competes with incumbents like Dentrix because they are owned by large supply companies, not tech companies. This fundamental difference in DNA means incumbents lack the technical skills and agility to innovate at the same speed, creating a durable competitive advantage.

Doximity integrates multiple workflow tools like telehealth and e-signatures. While specialized competitors might offer better individual products, Doximity wins by providing a convenient, all-in-one platform that doctors are already engaged with daily, creating a powerful defensive moat.

Instead of pursuing broad, shallow integrations, Practice by Numbers focused its engineering on the five largest Practice Management Systems. This strategic decision provided access to 70-80k dental offices, maximizing market penetration with minimal wasted effort and creating a significant moat.