Value Proposition Stack: A Cornerstone Perspective

When building a business or evaluating an investment opportunity, a clear and compelling value proposition is paramount. It not only differentiates a company in competitive markets but also underpins its long-term sustainability and growth trajectory. At Cornerstone Ventures, we’ve developed a proprietary framework—the Value Proposition Stack—to systematically evaluate the depth and durability of a company’s offering. This framework is central to how we identify, back, and scale high-potential startups—serving as both a lens for investment and a playbook for founders.

The Four Layers of the Value Proposition Stack

Our framework divides the value proposition into four distinct layers, each representing a different level of impact and potential:

1. The Process Enablement / Transactional Layer: The Foundation

At the base of the Value Proposition Stack is the Operating Layer, which centers on process enablement and transaction execution. Solutions here drive efficiency, streamline workflows, and ensure smoother day-to-day operations. While critical to keeping businesses running, this layer tends to offer the least differentiation and provides limited long-term competitive advantage.

At Cornerstone Ventures, we rarely invest directly in this layer, as companies here often face challenges with defensibility and scalability. Instead, we view these solutions as important enablers that support and unlock value for businesses operating in the higher, more strategic layers of the stack.

2. The Business Intelligence Layer: Turning Analytics into a Revenue Driver

The second layer of the Value Proposition Stack is the Business Intelligence Layer, which elevates business processes by embedding intelligence and enabling data-driven decision-making. Companies in this space harness data to generate actionable insights, helping organizations not only optimize operations but also uncover new growth opportunities.

At this level, raw data is transformed into meaningful narratives that shape strategy, guide resource allocation, and improve customer engagement. Done well, analytics moves beyond cost efficiency to become a true revenue driver—whether by predicting customer behavior, identifying new market opportunities, or personalizing offerings at scale.

The Analytics Layer is where we see significant potential for creating value by integrating intelligence into traditional processes. Many of our portfolio companies thrive in this layer, including:

• IntelligenceNode: Revolutionizing retail with AI-driven pricing and merchandising insights.

• Enparadigm: Empowering businesses with leadership and decision-making simulations.

• THB: Delivering advanced healthcare analytics for improving provider revenue streams.

• Wigzo: AI based personalization stack for online commerce and D2C brands for better ROI on their marketing spends across WebApp, Email, SMS, FB and WhatsApp.

3. The Marketplace Layer: Orchestrating Ecosystems

The next layer in the stack is the Marketplace Layer, where companies create platforms that bring together customers and suppliers to enable seamless transactions. The sustainable competitive advantage at this level lies in owning the relationships and trust that power these exchanges.

Marketplace models go beyond process optimization—they redefine industries by creating ecosystems that foster discovery, reduce friction, and enable scale. As supply and demand converge on the same platform, companies at this layer generate powerful network effects: the more participants they attract, the more valuable the marketplace becomes. This self-reinforcing dynamic makes marketplaces difficult to disrupt and allows them to capture a disproportionate share of industry value.

Examples of companies in our portfolio that are representative of this layer are:

• Mystifly: Transforming the travel ecosystem with its global marketplace for flight tickets bringing together buyers like OTA’s and suppliers like airlines.

• Blubirch: Not just automating the reverse supply chain management for online and brick and mortar retailers, but grading returns, creating and auctioning lots to wholesalers in tier 2 and 3 cities.

• Nitro: Redefining customer identification & targeting, creating an ads marketplace with rewards and recognition.

• ASL (UniAcco, UniCreds, UniScholars): Simplifying global education journey for students, from counseling & application, financing, matching accommodation at the target school to other services like essentials and flex accommodation by bringing in appropriate suppliers to the students in their higher-ed journey.

4. The Product/Platform Layer

At the top of the stack is the Product/Platform Layer, the most powerful and impactful layer where you own the entire revenue stack. They redefine industries by vertical integration and controlling multiple stages of its value chain. This creates ecosystems where they capture the entire value being generated.

Examples of companies in our portfolio that exemplify the Business Layer include:

• Newspace Research & Technologies (NRT): The company develops AI-powered unmanned aerial systems for next-gen defense, enabling persistent situational awareness, multi-domain autonomy, and swarm-based coordinated attacks.

• Credilio: Built India’s largest network of DSA – 40,000+ active agents for distribution of credit cards and personal loans. API-integration with 24+ leading banks of India and digital consumer platforms for distribution of cards & loans. Launched co-branded secured cards products on top of this distribution network (‘Novio’). Reached 15K cards in <6 months.

• OfBusiness: India’s largest and consistently profitable B2B marketplace with integrated NBFC (AUM of ~$1Bn). Dealer for all major raw-material categories – ferrous & non-ferrous metals, construction materials, agri-commodities, chemicals, textiles and others. White-labeled products with strategic demand to improve margins and control supply.

Investing in the Product Layer often leads to exponential growth opportunities, as these companies fundamentally reshape how industries operate.

Why the Value Proposition Stack Matters

Understanding the Value Proposition Stack allows entrepreneurs, investors, and stakeholders to:

1. Identify Core Strengths: Pinpoint where a company’s solution sits in the stack and how it creates value.

2. Align Strategy: Focus resources on climbing the stack to deliver higher-impact solutions.

3. Assess Scalability: Evaluate the long-term potential and defensibility of a business model.

Capturing Value across each layer

Take a hypothetical example of $100 flowing through a value chain i.e. a company generating $100 in revenue.

Operating at the process enablement or transactional layer—where the focus is primarily on automation or generic Agentic AI implementations—tends to deliver relatively low accretive value within the revenue stack. For instance, if process costs represent $10 of the $100 and automation improves efficiency by 10%, the value created is just $1. If the solution provider captures 10% of that improvement, the value captured amounts to only $0.10. This illustrates why the transactional layer, while important, offers limited upside and is highly susceptible to AI-driven disruption.

Now consider the Business Intelligence layer. At this level, advanced analytics or business intelligence tools can directly enhance topline revenue—for example, improving a $100 revenue base by 10%, or $10 in absolute terms. If the solution provider captures 10% of that improvement, the value captured rises to $1. While this represents a step up from the transactional layer, it remains vulnerable to AI-driven commoditization. The real defensibility, or moat, comes from assets that are harder to replicate—such as proprietary datasets, specialized industry models, or subject-matter expertise embedded into the analytics. These elements create differentiation and sustainability, preventing the solution from being easily displaced by generic AI tools.

At the Marketplace layer, the solution provider acts as an intermediary, bringing suppliers and customers together while enabling discovery, trust, and transaction execution. By controlling the value chain—particularly the matching of buyers and suppliers—marketplace operators are able to capture a meaningful share of the transaction value from both sides. For example, on $100 of total revenue, a critical marketplace intermediary may capture as much as 10% as affiliate fees, or $10. Because these providers own the network, the discovery mechanisms, and the matching intelligence, their position is structurally defensible and far less susceptible to AI-driven disruption. In fact, AI may enhance their advantage by improving personalization, fraud detection, and liquidity within the network, further reinforcing their moat.

Finally, at the Product or Platform layer, the solution provider owns the full product experience and captures the entire revenue stream. In this case, the full $100 of revenue accrues directly to the provider. As the owner and orchestrator of the ecosystem, the provider not only controls the product but also the surrounding customer experience, data, and distribution. This makes the business model far more resilient to AI-driven disruption, since competitors cannot easily displace a fully integrated product or platform without replicating the entire offering. In fact, AI often serves as an enabler here—enhancing differentiation, improving user experience, and deepening customer lock-in.

Moving between Layers of the Value Stack:

We have seen several founders successfully use capital to transition from operating in lower layers of the value stack to higher layers—where true multiple expansion occurs. This is often when we choose to double down and provide additional support. A strong example is Credilio, which began as a platform digitally enabling DSAs (Direct Selling Agents) to distribute credit cards, insurance, and loan products. They not only scaled their network from 3,500 to over 40,000 DSAs, but also enhanced marketplace dynamics by expanding access to financial institutions and products for each agent. Recognizing that a large portion of credit card applications were being rejected due to thin or non-existent credit histories, Credilio innovated further by launching their own secured credit card product, backed by deposit from the customer. By moving from a marketplace enabler to owning and distributing a financial product themselves, they advanced meaningfully up the value chain. We identified this strategic shift early and doubled down on our investment to back their transition.

For Cornerstone Ventures, this framework is not just a tool for evaluation but a guiding principle for building a diversified portfolio that balances innovation with impact.

Closing Thoughts

As you build or evaluate your next venture, ask yourself: Where does your solution fit in the Value Proposition Stack? Are you enabling processes, driving intelligence, building a marketplace or creating an ecosystem? Understanding this will not only shape your strategy but also determine your long-term success.

At Cornerstone Ventures, we’re committed to partnering with founders who aspire to operate at the top of the stack. Together, we can unlock unparalleled value and build the businesses of tomorrow.