Rippling: A Different Approach to Software Business

Rippling, an HR software startup valued at $13.5 billion, is taking a different approach to building software businesses. Rippling CEO, Parker Conrad, argues against the traditional narrow approach to building software businesses.

• He believes that focusing on a single pain point and then expanding features as the company grows is not the most efficient way to build software.

The Conventional Wisdom: Narrow Software Focus

Conrad believes the conventional wisdom of building business software is misguided. The typical approach is to build very narrow applications that focus on one specific pain point.

• This leads to businesses having to manage a multitude of separate software applications, which is inefficient and creates redundancies.

Rippling's Horizontal Approach: A Comprehensive System

Rippling aims to be an all-encompassing solution for HR and business needs. They offer a platform that integrates various functionalities, including payroll, expense management, corporate cards, and IT solutions.

• This horizontal approach allows Rippling to build multiple business software applications that are natively integrated into a single system.
• Rippling uses one dataset to build multiple applications, resulting in a standardized user experience.
• This system offers greater flexibility in pricing, as Rippling can offer various packages and bundles to meet different customer needs.

The Benefits of a Horizontal Software Business Model

Conrad argues that this horizontal approach offers several benefits for businesses, particularly in times of economic uncertainty.

• Businesses are more likely to opt for a comprehensive platform like Rippling than multiple single-feature applications, especially when budgets are tight.
• A horizontal approach can also help businesses avoid the "vendor lock-in" problem that often arises when businesses rely on multiple specialized software providers.

Venture Capital and the SaaS Landscape

TechCrunch has reported that many SaaS startups, particularly those focused on a single feature, are struggling in the current economic climate. Venture capitalists are hesitant to invest in such startups because they lack a clear competitive advantage.

• They prefer startups with broader offerings and a more comprehensive approach to solving business needs.

Rippling's Success: A Case for the Horizontal Approach

Rippling's success in raising $13.5 billion in funding and attracting a large customer base is a testament to the potential of its horizontal approach to software.

• Rippling's strategy could be a model for future SaaS startups that want to thrive in a competitive and dynamic market.

The Future of Software Business: Moving Beyond Narrow Focus

Conrad believes that the software industry is moving towards a more horizontal approach, with companies offering comprehensive solutions rather than specialized single-feature applications.

• Rippling is a pioneer in this trend, and its success could encourage other startups to adopt a similar approach.

Rippling's Impact on the HR Software Industry

Rippling is making waves in the HR software industry by offering a comprehensive solution for all business needs. Rippling's success could be attributed to its innovative approach to building software, which offers a more efficient and customer-centric solution. Rippling's success could encourage other startups to adopt a similar approach.