The Missing Third Move in Product Strategy
2026-04-15
Everyone talks about bundling and unbundling. Nobody talks about the move that doesn’t exist, and why that’s a trap.
There’s a famous line from Marc Andreessen that gets recycled every few years: the history of software is a history of bundling and unbundling. Big suites get picked apart by focused startups. Focused startups get absorbed into new suites. Rinse, repeat.
It’s a useful lens. But it’s incomplete in a way that destroys a lot of companies, specifically, it ignores a third axis that founders keep trying to build along, one that doesn’t actually work: horizontal cross-cutting.
Let me explain what I mean, and why this matters for how you position your product.
The Two Moves Everyone Knows
Unbundling is when you take one feature out of a bloated incumbent and make it a product. Expensify unbundled expense tracking from SAP. Calendly unbundled scheduling from Outlook. Notion, in some framing, unbundled documents and wikis from the broader productivity suite. The logic is simple: the incumbent serves too many masters and can’t go deep. You go deep.
Bundling is the reverse. You start focused and expand. Salesforce started as CRM, then bundled in marketing automation, analytics, service, platform. HubSpot started with inbound marketing software, then bundled sales, service, and CMS. The logic here: once you have distribution and trust, breadth creates lock-in and expands the revenue surface.
Both of these moves work because they have a clear unit of positioning. Unbundling says: “we do this one thing better than anyone.” Bundling says: “we are the system of record for this buyer.”
The Move That Doesn’t Work: Horizontal Cross-Cutting
Here’s where companies get lost.
Horizontal cross-cutting is when you try to position a product as serving a type of workflow or type of need across multiple industries, buyer types, or use cases simultaneously, without being the clear incumbent in any of them.
It sounds compelling in a pitch deck. “We’re the AI layer for operations teams.” “We’re the data platform for regulated industries.” “We’re the collaboration tool for knowledge workers.”
The problem is these are descriptions of a capability, not positions in a market. They don’t answer the buyer’s actual question, which is never “what category is this?” but always: “Why would I buy this instead of what I’m already using?”
When you cross-cut horizontally, you’re implicitly asking customers to understand your abstraction before they understand your value. You’re positioning against a void, there’s no incumbent to beat, no specific pain to anchor to, no obvious buyer who wakes up in the morning thinking about the problem you’ve named.
The result is a product that feels relevant to everyone and urgent to no one.
Why Founders Keep Making This Mistake
Three forces push smart people toward horizontal positioning:
1. TAM anxiety. Investors ask about market size. Vertical or point-solution positioning feels small. So founders reach for a horizontal frame to make the market look bigger. But a large addressable market you can’t actually address is worth nothing. A focused wedge you can dominate is worth a great deal.
2. The generalization trap in AI. This is especially acute right now. LLMs and foundation models are genuinely horizontal, they can do many things. So AI-native products often inherit that horizontality in their pitch. “Our AI works for sales, CS, HR, finance…” Cool. So does a spreadsheet. The question is whether you’re better than the specific tool a specific buyer already uses for a specific job.
3. Premature scale thinking. Founders who’ve read the right books know that eventually, great companies become platforms. So they try to position like a platform before they’ve earned the right. Platform-level positioning requires platform-level trust, which requires having already won somewhere specific first.
What Good Positioning Actually Does
Good positioning is always anchored in one of two ways: vertical depth (you serve a specific industry or buyer type better than anyone) or use-case precision (you solve a specific problem better than anything else).
Both of these create the conditions for a real buying decision. The buyer can compare you to what they’re currently doing. They can calculate the switch cost. They can imagine their workflow with and without you.
Horizontal cross-cutting doesn’t create those conditions. It asks the buyer to do too much work. And buyers, especially in B2B, do not do work on behalf of vendors.
The irony is that the companies that eventually become horizontal, Salesforce, Workday, Rippling, ServiceNow, all started with a very specific position. They earned the right to expand by winning one thing clearly first. The horizontal came later, and it came from compounding, not from initial positioning.
A Simple Test
If you’re a founder, try this: describe your product to a target buyer, then ask them: “What would you stop using if you bought this?”
If they can answer quickly and specifically, your positioning is working. The displacement is clear.
If they pause, look confused, or say something like “it depends” or “we’d use it alongside our existing tools”, you may be cross-cutting horizontally without realizing it. You’re a complement without a clear complement relationship, a layer without a clear substrate.
That’s not a product problem. It’s a positioning problem. And positioning problems are fixable, but only once you name them.
The best early-stage companies often have very unsexy, very specific positioning. That’s not a limitation. That’s the foundation everything else gets built on.
Unbundling and bundling are the two great product motions. But you have to pick a position first before either move makes sense. And that position is never horizontal. It’s always somewhere specific, a buyer, a workflow, a moment of pain, from which everything else eventually grows.
The companies that look horizontal in year ten almost always looked vertical in year one. That’s not coincidence. That’s the sequence.