To serve its largest customers, Square's open platform is crucial. It allows enterprises to integrate their preferred third-party tools with Square's core services. This flexibility prevents churn by allowing customers to customize their tech stack instead of being locked into a closed ecosystem.
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In an AI-driven ecosystem, data and content need to be fluidly accessible to various systems and agents. Any SaaS platform that feels like a "walled garden," locking content away, will be rejected by power users. The winning platforms will prioritize open, interoperable access to user data.
Square's product development is guided by the principle that "a seller should never outgrow Square." This forces them to build a platform that serves businesses from their first sale at a farmer's market all the way to operating in a large stadium, continuously adding capabilities to manage growing complexity.
Square views its role as taking complex technology, from financial tools to AI, that is usually only accessible to large corporations and making it simple and available to small businesses. The ultimate goal is to improve their survival rate and help revitalize local economies.
A Salesforce user with many integrations is less likely to churn, so its API is open. In contrast, Twitter restricted its API to prevent third-party clients from siphoning users away from its ad-supported feed. This fundamental difference in business models dictates a company's API strategy.
Smaller software companies can't compete with giants like Salesforce or Adobe on an all-in-one basis. They must strategically embrace interoperability and multi-cloud models as a key differentiator. This appeals to customers seeking flexibility and avoiding lock-in to a single vendor's ecosystem.
Stripe intentionally designed its Agentic Commerce Protocol (ACP) to be provider-agnostic, working with any payments processor and any AI agent. This strategic decision to build an open standard, rather than a proprietary product, aims to grow the entire agentic commerce ecosystem instead of creating a walled garden.
Don't just sell a product; become an indispensable part of your customer's workflow. By offering integrated products and services, you create a value ecosystem that locks out competitors and makes leaving an impractical and undesirable option.
To avoid the customization vs. scalability trap, SaaS companies should build a flexible, standard product that users never outgrow, like Lego or Notion. The only areas for customization should be at the edges: building any data source connector (ingestion) or data destination (egress) a client needs.
Users exporting data to build their own spreadsheets isn't a product failure, but a signal they crave control. Products should provide building blocks for users to create bespoke solutions, flipping the traditional model of dictating every feature.
To become indispensable to SMBs, a marketing platform cannot be a standalone tool. It must deeply integrate with the specific, proprietary systems that define an industry's workflow, such as a real estate agent's CRM or a mechanic's booking software. This ecosystem-first approach eliminates the friction of switching between tools, making the marketing platform a natural and effective extension of the SMB's core business operations.
