I'm biased to the security software market, but note that it's a market where companies have constantly tried to play the "productize-the-service" card. What I've observed is, this almost never works.

In fact, taking a consulting approach to product development (working closely with a first customer) also slowed us down drastically, and our product actually has very little to do with our service (what we're launching has nothing to do with reverse engineering software).

There are also some high-profile failures behind our strategy: building a straight-up consultancy to "fund" a full time product group.

But then again, who knows? Building a business is hard. It is not like applying to college, where you clear some "acceptance" hurdle and then you do your homework and everything works out. With the best people, the most credible strategy, and even the right market timing, circumstances can still screw you over.