Deep or Wide? Industry Cloud Companies

Emergence Capital has a fascinating piece in Forbes noting that “Industry Cloud” companies have outperformed traditional cloud companies as well as the NASDAQ this year.

Industry Cloud companies are vertically focused on a particular industry, as opposed to companies like, say, LinkedIn, that are horizontal across many industries. DealVector could be thought of as a type of industry cloud company (and indeed we are happy to see our little logo in the graphic of the industry cloud landscape!).

It will be interesting to see how the dynamic plays out between vertical and horizontal cloud companies. Although vertical companies have outperformed this year, most of the market cap and scale is with the horizontal players.  Will this translate into cloud company M&A activity? It seems reasonable to assume the bigger horizontal players will look to the vertical players for future growth.

Or is it more likely that industry vertical cloud companies will find natural strategic partners within their own industry?

Deep or wide, time will tell.