[slaxman]

37signals is one of them. They were in the software consulting business and built applications for in house use to manage their projects. They later realized that their clients need those applications as well.

I believe tumblr was a side project as well while the founder was consulting

[jorde]

I think this isn't what Seth meant: there's a lot of consultancies turned into product companies but it's different to start running a startup and then to work with your clients to find product market fit etc.

I would also be interested of examples

[teebs]

At least one example is http://rjmetrics.com/ - I saw the founder speak for a class I was in a few years ago. Their story is basically that they went to small companies offering analytics services and shaped their services based on what these companies asked for.