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Why software stocks are getting pummelled

economist.com

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Re: Why software stocks are getting pummelled

#231

Post by danielmarkbruce »

iamacyborg wrote: post #160
ManuelKiessling wrote: post #113

Earlier quoted context omitted.

I‘m not sure it’s a perfect example, but at least it’s a very realistic example from a company that really doesn’t have time and energy for hype or fluff: We are currently sunsetting our use of Webflow for content management and hosting, and are replacing it with our own solution which Cursor & Claude Opus helped us build in around 10 days: https://dx-tooling.org/sitebuilder/ https://github.com/dx-tooling/sitebuilder…

I’m not sure the world needed yet another CMS

It doesn't. The person is saying they built just the functionality they needed. Probably 25% of a CMS. That's the point.

Re: Why software stocks are getting pummelled

#232

Post by gfarah »

bandrami wrote: post #207
rstuart4133 wrote: post #146

Earlier quoted context omitted.

> > The fear is that these [AI] tools are allowing companies to create much of the software they need themselves. If that's their fear they don't know much how your typical big businesses functions. You've dealt with a large, consumer bank? Many of them still run on IBM mainframes. The web front end is driven by pushing buttons and screen scraping 3270 terminal emulators. You would think a bank with all it's resource…

Banks don't write software for the same reason that software companies don't store their own money

I disagree. For a long time now, the business of banking has been very much related to software. Software companies need a license to fully manage their money.

Re: Why software stocks are getting pummelled

#233

Post by ManuelKiessling »

danielmarkbruce wrote: post #231
iamacyborg wrote: post #160

Earlier quoted context omitted.

I’m not sure the world needed yet another CMS

It doesn't. The person is saying they built just the functionality they needed. Probably 25% of a CMS. That's the point.

Exactly.

And the big advantage for us is two things: Our content marketers now have a "Cursor-light" experience when creating landingpages, as this is a "text-to-landingpage" LLM-powered tool with a chat interface from their point of view; no fumbling around in the Webflow WYSIWYG interface anymore.

And from the software engineering department's point of view, the results of the work done by the content marketers are simply changes/PR in a git repository, which we can work on in the IDE of our choice — again, no fumbling around in the Webflow WYSIWYG interface anymore.

Re: Why software stocks are getting pummelled

#234

Post by ManuelKiessling »

solomatov wrote: post #123
ManuelKiessling wrote: post #113

Earlier quoted context omitted.

I‘m not sure it’s a perfect example, but at least it’s a very realistic example from a company that really doesn’t have time and energy for hype or fluff: We are currently sunsetting our use of Webflow for content management and hosting, and are replacing it with our own solution which Cursor & Claude Opus helped us build in around 10 days: https://dx-tooling.org/sitebuilder/ https://github.com/dx-tooling/sitebuilder…

Thanks for the link. So, basically you made a replacement for webflow for your use case in 10 days, right?

That's fair to say, yes, with the important caveat that it isn't a 1:1 replacement of Webflow, which is exactly the point.

Re: Why software stocks are getting pummelled

#235

Post by epolanski »

camdenreslink wrote: post #162
fragmede wrote: post #136

Earlier quoted context omitted.

Yes. $50k goes a long way outside of the Bay Area.

There is no way you would get anything close to as good as JIRA. Your best bet with that budget would be trying to integrate an existing open source on-prem solution (not sure what that alternative is for JIRA).

Jira is crap, so the bar is low.

Re: Why software stocks are getting pummelled

#236

Post by jeroenhd »

zamadatix wrote: post #156
jeroenhd wrote: post #145

Earlier quoted context omitted.

Reminds me of that time when Nintendo's stock exploded after the launch of Pokemon go, only for traders to discover a few hours later that Niantic actually owned the game and correct the situation.

Nintendo is one of the three 1/3 owners in The Pokemon Company and an early investor in Niantic. I'd be curious how much was actually confusion as to who is making money vs just a normal hype cycle. I'd also be curious how much the game itself made the various owners vs what Nintendo made on the general interest in other Pokemon games/merchandise from the launch. At the very least, the stock looks to have shot up for…

I was referring to the day Nintendo stock fell 17% after they published a notice on their website (outside of trading hours) that they did not in fact make Pokemon Go: https://www.theguardian.com/technology/2016/jul/25/pokemon-g...

The Zoom story is even crazier. The idea of the SEC needing to step in because traders were absolute idiots throwing their money away is laughable.

Let the traders burn their cash if they're too stupid to Google a stock's name, I say. Let them prove that the markets are intelligently driven and not just gambling for those under the influence of cocaine on the job.

Re: Why software stocks are getting pummelled

#237

Post by falloutx »

marcus_holmes wrote: post #190
falloutx wrote: post #81

Earlier quoted context omitted.

Everyone says that but I don't see anyone cooking up the next photoshop and selling it at $3/month. Why are we not seeing more options of every tool? Most Saas companies are sales companies at their core rather than software companies. And those sales people are so good that they can sell a todo list for millions.

> I don't see anyone cooking up the next photoshop and selling it at $3/month. That's not the situation we're talking about though. It's someone saying "hmm, I need to edit this picture. Can I get ChatGPT to do it?" where 3 years ago they would have had to buy Photoshop and learn how to use it. Similarly, if they need a tool to batch-convert a thousand images, they're getting an LLM to construct the specific tool the…

ChatGPT cant do the precise photoshop tasks, not even close, infact the quality of output is worse than quality of input almost always. Ofc we live in this low quality internet now, so you may already be used to terribly edited images by AI.

>You don't need a whole dev team to build a one-off tool for a specific job, which is probably 90% of the demand for those software products. LLMs are becoming the general-purpose tool for a lot of use cases.

No, all of these tools have 90+% revenue coming from B2B sales, consumers dont buy software products anyway. All of the software purchases are tax deductible so corporations buy even if they use very little of it.

Re: Why software stocks are getting pummelled

#238

Post by boshalfoshal »

lateforwork wrote: post #6

> The fear is that these [AI] tools are allowing companies to create much of the software they need themselves. AI-generated code still requires software engineers to build, test, debug, deploy, secure, monitor, be on-call, support, handle incidents, and so on. That's very expensive. It is much cheaper to pay a small monthly fee to a SaaS company.

two things:

1. ai being able to code well seems like it would also get pretty close/good at doing basically everything else you described. If coding is a game of reasoning, if you can solve that, you have effectively solved reasoning and you can likely map it to most other problems provided you have a sufficiently good harness and toolcalling setup. 2. Lets assume AI won't replace everyone as point (1) assumes - and it just replaces _most_ people. Under this assumption, we will likely see large swathes of layoffs. Many SaaS companies have a pay per seat model. Less people employed at companies = less seats being paid for = less SaaS revenue.

So not only is there a threat of companies just vibe coding various SaaS-es in house, but there is also a threat that the TAM of many SaaS products (which is typically proportional to the # of employees there are) will actually _shrink_ in size.

I think the main class of SaaS company that will remain in the medium term are the ones in legally touchy or compliance heavy industries - think healthcare, finance and security (workday for example). But even Workday will be affected by point (2) from above. Overall, I think the mid-long term outlook for SaaS, especially "SaaS", is not great.

Re: Why software stocks are getting pummelled

#239

Post by fragmede »

camdenreslink wrote: post #162
fragmede wrote: post #136

Earlier quoted context omitted.

Yes. $50k goes a long way outside of the Bay Area.

There is no way you would get anything close to as good as JIRA. Your best bet with that budget would be trying to integrate an existing open source on-prem solution (not sure what that alternative is for JIRA).

Oh please.

Yes, you wouldn't get something near as complicatedas JIRA, but that would be a good thing! Look, it's enterprise software, so I'm sure there's somewhere that needs to have the overcomplicated permissions system otherwise contractors are going to steal everything that isn't bolted down, but most places I've been don't need, and thus don't use most of all of that crap. If the ticket can only go from planned to done by a certain group of users, backed by LDAP... let's just say, I'm not going to miss configuring which group gets which permissions system.

JIRA's the perfect example of disruption, too. Everyone's got their bespoke workflow, and JIRA has to be customizable to suit all of them. Bespoke software just doesn't have to the same way.

Re: Why software stocks are getting pummelled

#240

Post by nasmorn »

danielmarkbruce wrote: post #229
robocat wrote: post #194

Earlier quoted context omitted.

> So what happens is a corporation ends up spending a lot of money for a square tool [SaaS] that they have to hammer into a circle hole. You are assuming that corporations have the capability to design the software they need. There are many benefits to SaaS software, and some significant costs (e.g. integration). One major benefit of SaaS is domain knowledge and most people underestimate the complexity of even well k…

this is true in many cases and not in many cases. Another true one is payments - it's complex AF and and no one will sit down and vibe code it. A CRM? Easy in many cases. Some workflow tool? Easy, they know the exact workflow. So, sure, some products will go the way of the dodo and some will not.

Only the still meek vibe code payments, the truly brave simply install the Stripe MCP directly in their on site chat window
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