What is Vertical Market Software vs Horizontal?

Differences between horizontal and vertical market software

90% of business acquisitions fail.

But there are exceptions.

Mark Leonard of Constellation Software has built an empire buying 500+ vertical market software (VMS) .

And turned $25 million into $40 billion.

What are these magical niche software businesses...

Software falls into two buckets::

Horizontal software - can be used across industries


- Excel
- Slack
- Zoom
- Salesforce

Vertical software - built for a specific industry


- Scheduling for bowling alleys
- Invoicing for magicians
- CRM for dentists

Horizontal Software

- Focus on a category
- More competition
- Big addressable market
- Big  upside, exit potential
- Expensive to acquire customers
- Expensive to compete on features

This is where VC & big tech thrive.

Vertical Software

- Focus on a category in an industry
- Don't have to invest as much in features
- Cheaper to acquire customers
- Less competition
- Smaller market
- Lower upside

This is where bootstrappers & holdcos thrive.

Want to learn how Mark Leonard built his empire?

Here is my operating manual on him & Constellation.

We cover everything you could ever want to know.