a16z, Anish Acharya: Is SaaS Dead? Do Margins Still Matter? Why We Are Not in an AI Bubble?

you have this innovation bazooka with these models. Why would you point it at rebuilding payroll or ERP or CRM? The general story that we're gonna vibe code everything is flat wrong, and the whole market is oversold software.

I'm so excited to welcome Anish Acharya, GP at Andreessen, where he leads consumer and fintech investing at Series A.

Now, an interesting topic that's not discussed is the cost of transitioning from one SaaS provider to another going dramatically down, so systems integration. I don't think we're allowed to believe in luck at Andreessen. We have to see a hundred percent of the deals in our domain, and that we win a hundred percent of the deals that we go after.

[clapperboard clapping] Ready to go? [upbeat music] Anish, dude, I've wanted to do this for a while. We've been going back and forth.

Yes, we have.

And so I'm so glad that we can do this in person. Thank you for joining me.

Of course. Thank you for having me.

I'm diving right in. We were just chatting now-

Yeah

... and I was saying, "I think it's better to build in, in London than in SF or in other places other than SF. Talent is cheaper. It retains for longer."

Yes.

"Uh, you don't have the promiscuity of people jumping from role to role."

Yes.

And you've built a company now, both in Canada and in SF.

Mm-hmm.

How do you reflect on what I just said?

I disagree with you. I wish it was true. I simply wish it was true, and I want it to be true, and maybe it will be true, that it will be, you know, the whole thing that we always love to say to ourselves around sort of talent and opportunity not being... You know, talent is equally distributed, opportunity is not. The truth is that cities are the original network effect, and for technology, there is a network effect for builders in SF and for this moment in technology, right? Where so many of the secrets are these sort of things whispered down shadowy hallways, the benefit of being in SF is enormous. There's also-- we just talked about this, there's a selection bias quest- question: Do you care enough to make it happen in SF? You can make it happen anywhere, New York, London, Toronto, Tel Aviv, you name it, but there's something different about saying, "I'm gonna give everything else up and be singular in my focus and move everything to SF to make it happen."

Are there any other locations where you think there is actually positivity associated with them being located there?

Tel Aviv. I think Tel Aviv, you can be incredibly ambitious and uncompromising on that ambition and have a really, really good reason to be there. I think the other nice thing about the Tel Aviv ecosystem is that the country's so small, it's ten million people, that you can't possibly fool yourself into thinking that the domestic market is gonna be big enough for whatever you're doing, so you immediately go outside. Whereas if you're in London, there's sixty million people here, okay? And you might say, "Well, that's actually a lot of people." And you know what? There are parts of the market, like fintech, where the LTVs are so high that perhaps sixty million is sufficient.