Eat. Vertical Agents. World.
The rocks can read. Precision matters.
In the seedy underbelly of Big Tech’s sprawling sterile digital general-purpose empires, something more specialized has been rising—salient, targeted, and inevitable. Vertical agents are an extremely fast-moving space poised to redefine industries, moving beyond generic software to intelligent systems deeply embedded in the workflows of specific domains.
In my mind, they’re not just tools; they’re autonomous problem solvers tuned to the heartbeat of an industry. Let’s think about it this way. If general-purpose AI is a vast neural luminsea, vertical agents are the surgical laser, carving out precise solutions for precise problems.
SaaS (Software as a Service), Venture Capital’s darling for the last two decades, has grown rapidly due to its convenience, scalability, and cost-effectiveness. Unlike traditional software, SaaS eliminates the need for costly infrastructure and lengthy installation processes, offering users an immediate solution with an embedded and elegant on/off switch.
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Now vertical agents are coming for this market.
What Are Vertical Agents?
Vertical agents could very well be the next evolution of AI—domain-specific systems designed for depth, not breadth. Unlike BigTech’s general-purpose AI models, vertical agents are trained with the nuances, regulations, and context of particular industries that commonly require deep domain expertise to succeed.
Domain expertise is critical for SaaS and vertical agents because industries have unique workflows, compliance requirements, and challenges vertical agents can deliver tailored features, seamless integrations, and better outcomes, such as faster operations or improved compliance.
Consider a few examples:
In healthcare, a vertical agent can manage patient diagnostics, flag potential risks then provide insurance, and recommend treatments.
In finance, it might analyze compliance risk across global portfolios or flag fraud patterns in real-time.
In logistics, it predicts disruptions caused by weather, geopolitical instability, or labor strikes before they hit the news cycle.
This focus builds trust with users, as they see the software solving their exact pain points while aligning with industry standards. It’s not just about the technology—it’s about understanding the context in which it’s applied.
Or in other words, these aren’t general assistants anymore; they are industry specialists. They don’t just process information—they own it.
Mindbody, Shopify, Clio, and ServiceTitan are noteworthy examples of successful vertical SaaS businesses that excelled in their respective industries by targeting unique business challenges with precision.
By 2024, Mindbody will serve over 65,000 wellness businesses, offering tools for scheduling, payment processing, and customer management, while connecting millions of consumers with fitness studios, spas, and salons via its app.
Shopify powers e-commerce for over 4 million merchants globally, providing comprehensive solutions for inventory, payments, and shipping, generating $5.6 billion in revenue in 2022 alone.
Clio supports more than 150,000 legal professionals with its cloud-based case management and billing software, tailored for the compliance-heavy legal industry.
ServiceTitan, used by over 100,000 tradespeople in plumbing, HVAC, and electrical services, simplifies job scheduling, invoicing, and customer communication, increasing operational efficiency for field-based businesses. Each company demonstrates the impact of domain-specific tools on improving business operations and enabling growth.
Vertical Agents: SaaS, but Sharper
The story of vertical agents begins where SaaS left off. Software-as-a-service democratized access to productivity and collaboration tools, riding on simplicity and scalability. Horizontal platforms like Salesforce, Slack, and Zoom didn’t need to understand your industry to create value—they optimized workflows across the board.
Interesting examples of young vertical agents companies in November 2024 are:
Perplexity is by now a well-known search and information retrieval agent that uses large language models to deliver highly accurate and relevant answers to user queries. Its niche lies in enhancing the search and information retrieval process, making it a specialized tool for improving user experience in information discovery.
Replit developed a cloud-based integrated development environment (IDE) that allows users to write, run, and collaborate on code across multiple programming languages. It focuses on the software development vertical, offering a streamlined environment tailored to developers and their specific coding needs.
11x provides a machine learning platform that analyzes business data to deliver actionable insights, aiding companies in improving performance. Its niche is in the data analytics and business intelligence vertical, offering tailored solutions to help organizations make informed, data-driven decisions.
So how can YOU earn money with your domain knowledge?
The Economics of Vertical Agents
I believe that vertical agents will be priced quite similarly to traditional SaaS businesses; however, the total cost of ownership will be substantially higher because of a combination of rare domain expertise, higher governance, and higher model-as-a-service cost.
Pricing Models
Base Subscription: Standard SaaS with access to core functionality at a predictable monthly or annual rate.
Usage-Based Pricing: Model-as-a-service in a nutshell. Pay per task.
Outcome-Based Pricing: Costs are tied to measurable business results—like increased revenue, reduced risk, or improved efficiency.
Enterprise Licensing: Large organizations deploy agents across geographies and divisions for scale.
All of these factors combined allow vertical agents to command premium pricing compared to generic tools, as they offer value within their domains. But what are the value drivers?
Business Models
Vertical agents drive value by leveraging a combination of technology, expertise, and data within the ecosystems they operate in:
Proprietary Training Data: Unique datasets tuned to specific industries give vertical agents their edge.
Custom Fine-Tuning: Based on this unique data, future models are tailored to match industry needs, making the agents more accurate and relevant.
Workflow Integration: Agents are designed to plug seamlessly into existing processes, reducing friction while increasing value. This creates a stickiness within the industry that is not plug-and-play anymore but attached the the spine of the industry.
Compliance and Security: Features tailored for regulated industries ensure trust and longevity.
Professional Services: Deployment, training, and consulting services build long-term relationships with enterprise clients.
And to me, this is the real moat!
It’s not just the cognitive agent—it’s the combination of proprietary data, domain expertise, and the sticky relationships these agents build.
Why Vertical Agents Will Win
BigTech companies like Google, Microsoft, and OpenAI own the generalist space, where scale and quality data pipelines win the day. But vertical agents thrive in areas where expertise, nuance, and compliance matter most.
Depth Over Breadth: Horizontal tools are good for general tasks. Vertical agents are irreplaceable in industries where the stakes—financial, legal, or human—are highest.
Proprietary Data: General-purpose AI is limited by what it can scrape. Vertical agents are trained on exclusive datasets that competitors can’t touch.
End-to-End Integration: Unlike horizontal tools, vertical agents don’t just support workflows; they become the workflow.
Big Tech will provide the scaffolding—foundation models, cloud platforms—but vertical agents are where value will crystallize.
What’s Next: The World in a Thousand Surgical Lasers
The rise of vertical agents signals a future defined by hyper-specialization.
I think it could look like this :
Agent Ecosystems: Industries will rely on interconnected agents working in symphony—supply chain optimizers feeding logistics planners, which feed compliance risk evaluators. Microsoft’s Autogen is a strong contender to be the enterprise solution these agents need.
Data Arms Races: Proprietary datasets have been the new oil for a decade. Now they will be even more fiercely guarded and monetized.
Regulatory Battles: With agents taking on high-stakes decisions, transparency, fairness, and compliance will come under intense scrutiny.
Human-AI Hybrid Workflows: The best agents won’t replace experts—they’ll amplify them. Doctors, lawyers, and analysts will wield AI-like cognitive exoskeletons.
It’s Inevitable
With all that’s said. I believe vertical agents aren’t a trend. They’re a tectonic shift. It feels like every three months we see a game-changing improvement in memory management, tool use, or robust cognitive capabilities. The rate of progress is stunning to see. While SaaS democratized access to replace expensive boxed software, vertical agents are rewriting the rules of business, industry by industry. These agents will eat the inefficiencies of the software world—not as omnivorous giants but as scalpel-sharp specialists.
Therefore, I believe the winners of tomorrow's SaaS world won’t be the companies with the most data or the largest models—they’ll be the ones who ask the smartest questions and build the most indispensable agents.
Think about it. If you can find a boring repetitive task in your daily life, there is probably a billion-dollar business behind it.
