Multi-destination mode lets you route folders individually. Some subfolders go to SharePoint, others to OneDrive users, others get excluded entirely.
Common use cases:
In the project Destination step, flip Multi-destination mode on.

The single-destination card is replaced with a two-column layout: source folders on the left, destination mappings on the right.
Click any folder in the source tree. A choice modal appears:

Pick SharePoint, OneDrive, or Exclude:
The mapping saves, a badge appears on the folder in the tree, and the right panel shows the mapping under the relevant tab.
Three tabs on the right:

Each mapping shows the source path, destination, and edit/remove actions.
Child folders inherit their parent's destination unless you explicitly override them. So mapping \\fileserver\HR to a SharePoint library automatically covers \\fileserver\HR\Contracts, \\fileserver\HR\Onboarding, etc.
Override inheritance by clicking the child folder and picking a different destination. The child's new mapping takes precedence over the parent's.
Use it when:
For everything else, single destination is simpler.
See Excluding Folders for the details on exclusions, or move to running a scan.