Why Great Software Has Leverage (And Why It Creates Outsized Results)
A lot of people think software is valuable because it’s “advanced” or “technical.”
But the real reason great software wins is simpler:
software has leverage.
Leverage means one good decision, one good system, or one good feature can produce results far beyond the effort that created it.
That’s why a small team can outperform a large organization.
That’s why a single product can serve millions.
That’s why great software companies scale faster than most industries in history.
Let’s break down what leverage actually is in software — and why the best software has more of it.
What “leverage” means in software
Leverage is when:
a small input produces a large output.
In software, that happens because code can be:
copied instantly
deployed globally
run nonstop
improved incrementally
reused across many workflows
Once software exists, it can keep producing value without needing a proportional amount of human labor.
That’s the magic.
1) Near-zero marginal cost: build once, serve many
In most fields:
More customers = more staff.
In software:
More customers often just means:
more servers (sometimes)
a bit more support (hopefully)
but the same feature can serve everyone
That’s why a feature built for one customer can be sold to 10,000 more with almost no extra cost.
This is one of the biggest sources of leverage in the modern economy.
2) Automation: turning repeatable work into a machine
Software turns “people work” into “system work.”
Anything repeatable can become:
a workflow
a button
a rule
a script
a background process
When you automate something:
You don’t just save time once.
You eliminate a recurring cost forever (or until requirements change).
That’s compounding leverage.
3) Distribution leverage: software travels faster than humans
A consultant scales by adding hours.
A service business scales by adding people.
Software scales by:
links
app stores
marketplaces
APIs
integrations
virality
referrals
A good product can spread faster than a team can expand.
That’s why distribution is often more important than features.
4) Decision leverage: software encodes best practices
Great software doesn’t just “do tasks.”
It makes decisions easier by embedding:
defaults
guardrails
validation
recommended next actions
constraints that prevent mistakes
That means users get better outcomes without needing to become experts.
Examples:
a checkout that reduces cart abandonment
an onboarding flow that prevents bad configuration
a dashboard that highlights what matters instead of showing everything
When software improves decisions, it creates leverage for every user.
5) Time leverage: software works while you sleep
This is underrated.
Software can run:
at night
on weekends
continuously
Monitoring, reporting, syncing, indexing, sending notifications, security checks—systems don’t need motivation.
So you get results from time periods where humans wouldn’t be working at all.
That’s leverage against time itself.
6) Improvement leverage: iterations compound
A product doesn’t “reset” when you ship a new version.
It compounds:
performance improvements
UX improvements
fewer bugs
better onboarding
smarter defaults
more integrations
stronger reliability
Each improvement raises the baseline forever.
That’s why small improvements matter more in software than in many other fields.
7) Network leverage: the value grows as usage grows
Some products become more valuable as more people use them:
collaboration tools (more teammates, more value)
marketplaces (more buyers/sellers)
platforms (more developers, more plugins)
knowledge systems (more data, better insights)
This is why “good enough” products can be overtaken by products with better network effects.
8) Reuse leverage: one system becomes many products
Great teams reuse:
components
internal libraries
design systems
infrastructure
deployment pipelines
data models
That means each new feature gets cheaper over time.
This is why strong engineering foundations create huge long-term leverage:
they reduce the cost of building everything else.
What makes software “great” (from a leverage perspective)
A lot of software is functional but has low leverage.
Great software tends to do at least one of these extremely well:
1) It eliminates friction
fewer steps
fewer decisions
fewer errors
less time-to-value
2) It removes mental load
clear structure
predictable workflows
strong defaults
less “where do I click next?”
3) It turns chaos into a system
turns messy work into repeatable workflows
makes outcomes consistent
makes progress trackable
4) It scales without breaking
reliability
performance
clean architecture
graceful failure
5) It integrates with reality
connects to other tools
fits into existing workflows
reduces switching costs
Leverage isn’t just “cool features.”
Leverage is outcomes per unit effort.
The business takeaway
This is why software is paid well and scales well:
it creates reusable value
it can improve outcomes for thousands or millions of users
it compounds improvements over time
A single good product can outperform entire service organizations.
That’s leverage.
The personal takeaway (for developers and founders)
If you want to build high-leverage software, focus less on “more features” and more on:
reducing user mistakes
removing steps
improving defaults
simplifying workflows
making progress visible
building foundations that reduce future cost
That’s where the leverage lives.