Beyond SaaS: Why capital is the new platform moat

GlobalData

Tue, Apr 29, 2025, 7:02 AM 4 min read

SaaS has been a currency cattle for platforms for much than a decade, but it was lone ever meant to beryllium a means to scaling maturation - ne'er a destination successful itself.

Yet the model’s recurring revenues and predictability person led galore platforms into a SaaS trap. Even though semipermanent SaaS gross maturation is slowing, they instrumentality to the aforesaid formula.

But AI raises different threat. A beauteous UI, clever onboarding flows, a “holistic dashboard” tin beryllium copied and created successful a play with AI tools similar GPT-5 and Lovable.

When everything tin beryllium built and replicated successful conscionable a fewer clicks, the lone happening near to marque you basal retired is simply a fintech moat. And the strongest –and astir evident – moat is capital.

Embedded concern gives platforms much than a feature; it’s a strategy of distribution, data, and trust. AI whitethorn beryllium capable to transcript your features, but it can’t transcript your lending relationships. It can’t assistance a household concern screen currency travel gaps, assistance an ambitious laminitis put successful caller stock, oregon alteration a edifice to regenerate a breached fridge overnight. Embedded lending creates a stickiness that investors emotion to spot and a gross watercourse that doesn’t trust connected changeless upselling.

You lone request to look astatine the companies pulling up to spot this interaction successful action. For instance, Shopify Capital has issued implicit $2 cardinal successful backing to its merchants since 2016. Merchants that instrumentality this backing turn 36% much than their peers, 76% travel backmost for more, and Shopify has seen its gross soar from $389 cardinal to $8.88 cardinal since Capital’s launch.

At Toast, fiscal services, not software, are present its biggest gross driver. Uber’s embedded payments didn’t conscionable boost gross by 10% successful a year, they made the full merchandise better: 15% higher retention, 25% little admin costs and 20% amended advertisement conversions.

These platforms didn’t get lucky. They stopped reasoning similar diagnostic factories and started giving existent and considered thought to what their customers really need. And each SMEs, nary substance their size, sector, oregon region, request the aforesaid happening – money.

Of course, this has been existent since the aboriginal days of the industry, but it’s been thrown into stark presumption successful caller years owed to the continued decimation of precocious thoroughfare banks.

The decease of section relationships with lenders who genuinely “get” your concern has near SMEs with fewer – and dwindling – options. Outdated recognition models and one-size-fits-all financing person created a staggering €400bn spread successful SME backing successful Europe alone. This isn’t conscionable atrocious for those businesses, it’s atrocious for the economy. Small and medium-sized businesses marque up the bulk of the companies crossed the continent and beyond, and if they neglect oregon stall, we each do.