Quote: vertical SaaS moment

A founder who built software for flooring retailers says artificial intelligence is opening a new vertical software cycle in industries like construction and government. (x.com) Todd Saunders made that case in a post on X, the platform formerly called Twitter, arguing that teams inside hard-to-digitize sectors can now build tools for their own workflows instead of waiting for broad software vendors. Saunders is the chief executive of Broadlume, a flooring software company Cyncly said on December 5, 2024 it had agreed to acquire. (x.com) (cyncly.com) Vertical software means products built for one trade or agency, not for every office job. Andreessen Horowitz wrote on September 20, 2024 that the category’s first wave put industry workflows online, a second wave added financial services, and a third wave is using artificial intelligence to automate work that had stayed manual. (a16z.com) That pitch lands in sectors where the work is specific, regulated, and still runs on old systems. The Government Accountability Office said on July 17, 2025 that the federal government spends more than $100 billion a year on information technology, mostly to run and maintain existing systems, and that 11 critical federal legacy systems still need modernization. (gao.gov) The same pattern shows up in construction, where software has to match estimating, scheduling, field crews, materials, and compliance instead of generic office tasks. McKinsey wrote that the United States construction industry had roughly 440,000 job openings in April 2022 and estimated the Bipartisan Infrastructure Law could create demand for more than 300,000 additional jobs a year at its 2027 and 2028 peak. (mckinsey.com) Investors have been sketching this shift in stages. Andreessen Horowitz said companies such as Toast and Mindbody expanded by owning more of an industry’s workflow, then used artificial intelligence to take on sales, customer service, operations, and finance tasks that once required more staff. (a16z.com) Saunders is speaking from a niche market that fits that template. Cyncly said Broadlume sells digital marketing, visualization, payments, and business management tools to thousands of flooring dealers and manufacturers across North America and serves more than 20 million consumers. (cyncly.com) The argument is not that every industry will buy one giant model and call it software. It is that the people who know the forms, edge cases, and daily bottlenecks in fields like flooring, construction, or public administration can now package that knowledge into products faster than in earlier software cycles. (x.com) (a16z.com) That leaves the next test where Saunders started: whether domain experts can turn local know-how into durable products before larger platforms move downmarket. In vertical software, the winner is usually the company that understands the workflow best. (x.com) (a16z.com)