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AI agents are starting to eat SaaS

martinalderson.com

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Re: AI agents are starting to eat SaaS

#281

Post by robofanatic »

SkyPuncher wrote: post #237
benzible wrote: post #124

I'm CTO at a vertical SaaS company, paired with a product-focused CEO with deep domain expertise. The thesis doesn't match my experience. For one thing, the threat model assumes customers can build their own tools. Our end users can't. Their current "system" is Excel. The big enterprises that employ them have thousands of devs, but two of them explicitly cloned our product and tried to poach their own users onto it.…

Our sales teams heres the "we'll just build it internally" or "we can just throw it into an LLM" all of the time. Yes, certain parts of our product are indeed just lightweight wrappers around an LLM. What you're paying for is the 99% of the other stuff that's (1) either extremely hard to do (and probably non-obvious) (2) an endless supply of "routine" work that still takes time (3) an SLA/support that's more than "ra…

> "we'll just build it internally" or "we can just throw it into an LLM" all of the time.

Is that a bluff used to negotiate the price?

Re: AI agents are starting to eat SaaS

#282

Post by LunaSea »

dismalpedigree wrote: post #183
jwr wrote: post #135

I am the founder of a niche SaaS ( https://partsbox.com/ — software for managing electronic parts inventory and production). While I am somewhat worried about AI capabilities, I'm not losing too much sleep over it. The worry is that customers who do not realize the full depth of the problem will implement their own app using AI. But that happens today, too: people use spreadsheets to manage their electronic parts (pl…

Not specific to PartsBox, but we use Inventree (open source similar to PartsBox) and self host it. Over the past few months we noticed certain pain points in our workflow. Rather than looking for a new tool, we used Claude Code to write some backend services and some frontend modifications. Took 2 days of tinkering. Has easily saved that much time since we implemented it. While rolling the whole solution with an AI a…

Won't this breakdown if you need to pull new changes from the original project?

Re: AI agents are starting to eat SaaS

#284

Post by hennell »

This is what I don't get with a lot of the AI based saas projects - what is your value add? If you can build it with AI then (in theory) your customer can also build it with ai, so why do they need you? In the SaaS world you don't because the cost of development and maintenance just doesn't scale well, but if you're 99% a wrapper around an AI, your 'business' feels easily replicable to me.

But that does leave a weird gap where SaaSes that took a lot of time to make but can now be handled by an Ai won't survive either. If the business stays hand-coded it costs too much to be viable, if it moves to Ai it looses any advantage over doing it youself.

Re: AI agents are starting to eat SaaS

#285

Post by Bombthecat »

ben_w wrote: post #194
j45 wrote: post #185

Earlier quoted context omitted.

The technology of LLMs is already applicable to valuable enough problems, therefore it won’t be a bubble. The world might be using a standard of AI needing to be a world beater to succeed but it’s simply not the case, AI a is software, and it can solve problems other software can’t.

> The technology of LLMs is already applicable to valuable enough problems, therefore it won’t be a bubble. Dot-com was a bubble despite being applicable to valuable problems. So were railways when the US had a bubble on those. Bubbles don't just mean tulips. What we've got right now, I'm saying the money will run out and not all the current players will win any money from all their spending. It's even possible that…

The big models will never run locally, and I doubt that titan and co will run locally, just way to much resources needed

Re: AI agents are starting to eat SaaS

#286

Post by solaire_oa »

dismalpedigree wrote: post #183
jwr wrote: post #135

I am the founder of a niche SaaS ( https://partsbox.com/ — software for managing electronic parts inventory and production). While I am somewhat worried about AI capabilities, I'm not losing too much sleep over it. The worry is that customers who do not realize the full depth of the problem will implement their own app using AI. But that happens today, too: people use spreadsheets to manage their electronic parts (pl…

Not specific to PartsBox, but we use Inventree (open source similar to PartsBox) and self host it. Over the past few months we noticed certain pain points in our workflow. Rather than looking for a new tool, we used Claude Code to write some backend services and some frontend modifications. Took 2 days of tinkering. Has easily saved that much time since we implemented it. While rolling the whole solution with an AI a…

First, I'll second that I've applied agentic LLMs to an open source project to fix bugs and forcibly coerce it to act in ways that the maintainer may or may not approve of. It has been remarkablely effective, so long as I'm willing to apply patches or maintain a fork of the project (trivial, since this particular open-source project is abandoned anyway).

That said, the act of doing this- using LLMs to dominate somebody's legitimately intelligent and unique work- feels not only discourteous, but worse, like it's a short-term solution.

I'm convinced that it's a short-term solution NOT because I don't think that LLMs can continuously maintain these projects, but because open-source itself is going to be clawed back. The raison d'être of open-source is personal pride, hiring, collaboration, enjoyment, trust, etc. These motivations make less sense in an LLM-fueled world.

My prediction is that useful and well maintained open-source projects like we're hijacking will become fewer and far between.

Re: AI agents are starting to eat SaaS

#287

Post by fumblebee »

My understanding is that agents are:

1) helping to saturate traditional SaaS because code is being commoditized / the effort to build is dropping significantly.

2) defining an adjacent sub-category of SaaS: "Service-as-a-Software" where the SaaS provides _outcomes_ instead of _tools_; this couldn't really exist at scale before recently.

Re: AI agents are starting to eat SaaS

#288

Post by baxtr »

benzible wrote: post #124

I'm CTO at a vertical SaaS company, paired with a product-focused CEO with deep domain expertise. The thesis doesn't match my experience. For one thing, the threat model assumes customers can build their own tools. Our end users can't. Their current "system" is Excel. The big enterprises that employ them have thousands of devs, but two of them explicitly cloned our product and tried to poach their own users onto it.…

> The bottleneck is still knowing what to build, not building. A lot of the value in our product is in decisions users don't even know we made for them. Domain expertise + tight feedback loop with users can't be replicated by an internal developer in an afternoon.

The cost of building is going decreasing every year. The barriers of entry will come down year after year.

So what remains is knowing what you build (= product) as you write and knowing how to get exposure (= marketing). Focus on these two not on building things.

Re: AI agents are starting to eat SaaS

#290

Post by CyanLite2 »

benzible wrote: post #124

I'm CTO at a vertical SaaS company, paired with a product-focused CEO with deep domain expertise. The thesis doesn't match my experience. For one thing, the threat model assumes customers can build their own tools. Our end users can't. Their current "system" is Excel. The big enterprises that employ them have thousands of devs, but two of them explicitly cloned our product and tried to poach their own users onto it.…

I'm seeing that in the GRC industry where SaaS companies are getting churned out by an internal IT guy who automated their "Excel" as a database.
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