From SaaS to AI-First: How Companies Are Reshaping Innovation

The anxiety that I see is, if you can generate an enormous amount of code and no one is reading it, you don't know the quality of the code. Nobody deeply understands the code base, and there's more fragility, right? It's like the slop problem, vibe coding slop in my actual production code base. But I think the broader problem that new company could go solve is, like, nobody knows how to manage that issue of human attention to engineering. I think it's like open season around this really, really big problem. [upbeat music] Hi, listeners. Welcome back to No Priors. Markets are melting down about the end of software. Today, Elad and I are hanging out and asking: Is SaaS actually dying, or are people just projecting five-person startup behavior onto the Fortune one hundred? We'll talk about what's real, incredible revenue growth, collapsing token costs, and faster turnover offenders, what's just hype, and how to size the opportunity. We also discuss the changing bottlenecks in building a software company and some parallels to the internet and cloud eras. Let's get into it. It's good to hang. The, the market is freaking out around us. So in all that noise, what are you thinking about?

Oh, you mean the SaaS, the SaaS-polcalypse?

The SaaS-polcalypse, the end of software.

Yeah. [chuckles] Software. Yeah, it's kind of interesting. I feel like there's some meta trends that people are getting right and then a lot of specific companies that people are getting wrong. And so, you know, I think... I guess the basic premise is that SaaS software and proceed software will no longer exist, and everything's gonna be replaced by AI, and everything's just gonna get vibe coded. So why would you pay X dollars for a Salesforce instance when you can just vibe code it internally? And all that stuff strikes me as incredibly short-sighted in the near term. Over the long run, who knows what happens in twenty years or whatever, but there's lots and lots of companies that are quite durable. I think an interesting example of that, where I'm still a shareholder, is Samsara, where, you know, nobody's gonna vibe code a fleet management app that will then get distributed through, like, what? Vibe sales, vibe, you know, enterprise sales or something. [laughing] And you're gonna build a vibe like in-cab camera sensor that everybody will install in these fleets, and then you're gonna support them using vibe agents or something. It's just, it's just very overstated. So I feel like it's one of those things where there's a massive market correction around something that, in the long run, has a lot of truth to it, and maybe in the short run for certain types of companies, has a lot of truth, right? Ultimately, I think Decagon and Sierra are, are examples of companies where you're moving from proceed software to basically utilization-based customer support related agents, right? That is a real shift that may impact some of the prior wave of sort of proceed software companies, but this isn't gonna be every single SaaS company. So I, I, I view it as very short-term overstated. In the long run, who knows? How about you? How do you think about it?