During the past decade, Silicon Valley's No.1 rule for niche markets, pick-and-stick solutions and quick roll-out has been well-received, leading to many individual point solutions in the form of B2B SaaS. As a result, users have been forced to switch frequently among multiple solutions. To address this hassle, new startups have begun to emerge that are targeting several issues at once by combining different point solutions in parallel. Rippling is a case in point. Parker Conrad, the CEO of Rippling labeled such startups compound startups.

A compound startup is far from an all-in-one, which, in fact, is one big point solution with multiple added features. It is also different from a multi-product approach that offers several independent services. A compound product has multiple point solutions within a single product and users can mix and match the solutions they need.

Rocket WORK is another example of a compound startup. While Rippling focuses on HR, Rocket WORK deals with more general tasks and jobs in the workplace. Currently, four point solutions are available with Rocket WORK: a Smart Order solution that creates kiosks or simple payments, a Customer Chat solution, an Automating Repetitive Work solution, and a Project Management solution. Steve Choi, CEO of Rocket WORK, said that the company would be offering more than ten point solutions by 2025 so that any type of task could be completed within the program. Instead of using one point solution in the platform and then adopting another external service to handle another task, companies can instead introduce another point solution within Rocket WORK, which will create a greater synergy effect resulting from the high interoperability between the point solutions.

CEO Choi also commented that because not everyone does the same job, creating a giant all-in-one product can serve to unnecessarily increase complexity by adding features that a user does not require. If a service provider gives users the choice of A, B, C, D, E, F, and G point solutions for each respective problem in one product, users can pick and choose based on their needs and configure the product so that it is a perfect fit for them.

A compound startup requires more input and time for development than that needed for single point solutions. In addition, as a high level of interoperability is needed among point solutions, the development process is much more complex. These factors serve as higher barriers to entry. On the other hand, this type of mix-and-match product can better generate profits in the long run because each point solution can create multiple revenue models or bundles with different configurations. After focusing only on development for two years without any profit, Ripple earned 100 million dollars in annual recurring revenue in a very short period of time after its roll-out. Rocket WORK, too, launched its service in 2022 after two years of development and is now available in seven languages, attracting global users.

Rocket WORK is a compound product that offers multiple B2B SaaS point solutions, allowing many different tasks to be digitally integrated. Users can make their own combination of point solutions, add other point solutions they require, and use the customized B2B SaaS within the platform.