down-stack

Definition

Moving to build or sell products at a lower layer of the technology infrastructure, typically where margins are thinner but the market is larger. Often happens when companies realize their original niche is too small.

Example Usage

After dominating the CRM for pet groomers market, we decided to go down-stack and build a general database tool.

Origin

Software architecture terminology adapted to business strategy, emerged in 2010s SaaS era

Fun Fact

Going down-stack usually means more competition and commoditization—you're trading specialty margins for volume plays.

Source: SaaS business strategy terminology

Related Terms

Intermediate

scaling

The corporate fantasy of growing a business exponentially while somehow maintaining quality, usually uttered right before everything falls apart. It's the process of increasing capacity to handle growth—or in startup speak, the thing you'll figure out later after raising millions in VC funding. In tech, it means making systems handle more users; in reality, it means discovering all the shortcuts you took when building the foundation.

🚀 Startup / VC

Intermediate

rolling close

A fundraising approach where a startup accepts investor commitments and transfers shares on multiple dates instead of a single closing. It's like a progressive dinner party for term sheets.

🚀 Startup / VC

Beginner

passion tax

The lower compensation that employees accept to work at mission-driven startups or in attractive industries like gaming or entertainment. Employers exploit your dreams to underpay you.

🚀 Startup / VC

Advanced

acceleration clause

A provision that speeds up the vesting of unvested equity upon specific events like acquisition or termination. It's the golden parachute for startup employees who might otherwise get screwed by good news.

🚀 Startup / VC

Intermediate

deployment velocity

The speed at which a venture fund invests its committed capital, often scrutinized as a metric of both deal flow quality and fund discipline. Too slow suggests weak deal flow; too fast suggests poor judgment and FOMO.

🚀 Startup / VC

Beginner

liquidity event

The magical moment when your paper wealth becomes actual money you can spend—typically through an acquisition or IPO. It's what everyone's working toward but few actually experience.

🚀 Startup / VC

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