At the beginning of my career, SaaS didn’t exist. Tech companies had to create everything themselves. Even small enterprises had their own makeshift timekeeping sheets, CRM systems, and even ERPs. This led to the emergence of “legacy software.” It was mostly terrible, hastily made by summer interns without much enthusiasm, and there were constant complaints. Then came SaaS. Now, there’s an app for any task, and a SaaS solution for every business function.
My name is Nikolai Markov, founder of the Neuro Plume agency, specializing in the development and implementation of AI-based solutions. Our team of experts creates innovative products that help companies automate processes and increase their efficiency.
What is SaaS? Simply put, SaaS is a cloud-based solution model that provides software access via subscription. Today, the basic operating system of a startup is a web of various SaaS applications. And, as any founder will confirm, the bills add up very quickly. I’m sure there are SaaS tools in your business that even your CFO hasn’t heard of. You do have a CFO, right? Really?
The worst part is that these companies have become so wealthy from their gross margins that they’ve stopped evolving. I’ve been using JIRA for most of my career, and it literally looks the same as it did in the beginning. The only thing they did was move this outdated software to the cloud ten years ago. Maybe they made the buttons a bit rounder. Just a bit.
It’s gotten so far that now we need a SaaS to manage your SaaS bills. And that’s no joke.
What is SaaS? Simply put, SaaS is a cloud-based solution model that provides software access via subscription. Today, the basic operating system of a startup is a web of various SaaS applications. And, as any founder will confirm, the bills add up very quickly. I’m sure there are SaaS tools in your business that even your CFO hasn’t heard of. You do have a CFO, right? Really?
The worst part is that these companies have become so wealthy from their gross margins that they’ve stopped evolving. I’ve been using JIRA for most of my career, and it literally looks the same as it did in the beginning. The only thing they did was move this outdated software to the cloud ten years ago. Maybe they made the buttons a bit rounder. Just a bit.
It’s gotten so far that now we need a SaaS to manage your SaaS bills. And that’s no joke.
AI-based Operating System
Often, SaaS tools fill small tactical gaps where using entire suites like Salesforce, Hubspot, or even Shopify would be overkill. At our agency, we actively use artificial intelligence to create such solutions.
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As for more complex software?
Developing software for startups is often easier, as initially, it requires something to perform a specific task. Over time, as the product and operations grow and become more complex, these tasks begin to expand. The startup becomes wealthy and grows into a corporation.
Corporations place great importance on security and compliance. Software providers take care of this, or at least claim to. This leads to a certain delegation of risks. If something goes wrong, you can always point the finger at the provider while keeping your bonuses.
At the same time, a secondary trend is developing: AI is also increasing developers’ productivity. Some report a few percentage points increase, while others claim 200%.
For clarity, we conducted a simple calculation to assess how AI’s influence on productivity could reduce software development costs. We considered basic assumptions such as economic growth and inflation, which typically increase prices, low price elasticity due to increasing demand, and a gradual decrease in the number of developers choosing other, less AI-displacement-risky professions.
Corporations place great importance on security and compliance. Software providers take care of this, or at least claim to. This leads to a certain delegation of risks. If something goes wrong, you can always point the finger at the provider while keeping your bonuses.
At the same time, a secondary trend is developing: AI is also increasing developers’ productivity. Some report a few percentage points increase, while others claim 200%.
For clarity, we conducted a simple calculation to assess how AI’s influence on productivity could reduce software development costs. We considered basic assumptions such as economic growth and inflation, which typically increase prices, low price elasticity due to increasing demand, and a gradual decrease in the number of developers choosing other, less AI-displacement-risky professions.
Despite all these factors, the cost of writing code will decrease as AI takes over this task. It’s quite possible that it will become so low that coding will not only become a marginal cost but will also lose its significance. And this is a fairly conservative model, as it only accounts for gradual improvements in efficiency.
When AI agents reach a level that allows them to perform large-scale software tasks with industrial quality, the cost of development will plummet.
When AI agents reach a level that allows them to perform large-scale software tasks with industrial quality, the cost of development will plummet.
Not all SaaS is equally valuable
Code is becoming cheap. Who will survive, who will disappear? Who decides?
Companies that build their business exclusively on SaaS, where the software itself is the product, are at the highest risk. Obviously, most companies won’t create their own Photoshop — it’s mostly unnecessary.
However, building your own CRM system was not uncommon before SaaS. This may become possible again. Technical platforms like Datadog are at risk. Many startups use it because it seems like a good idea, but they end up wasting money by logging unnecessary debug data. It seems that an LLM could handle this.
Nevertheless, these companies will not give up without a fight. Many of them are already adding various AI integrations to their software suites. But the reality is that it’s hard for corporations to restructure for a new era, in this case, the era of AI-based solutions. The innovator’s dilemma will force them to milk their SaaS model until it’s too late to catch up with competitors. However, the competition does not come from new startups, but from their current customer base, which may simply stop using their services.
So, in a world where code is cheap and AI is taking over, there’s only one question left: who’s next to go? Maybe your favorite SaaS. But don’t worry, as you read this article, our new AI agent is already developing its replacement. Or at least trying.
Companies that build their business exclusively on SaaS, where the software itself is the product, are at the highest risk. Obviously, most companies won’t create their own Photoshop — it’s mostly unnecessary.
However, building your own CRM system was not uncommon before SaaS. This may become possible again. Technical platforms like Datadog are at risk. Many startups use it because it seems like a good idea, but they end up wasting money by logging unnecessary debug data. It seems that an LLM could handle this.
Nevertheless, these companies will not give up without a fight. Many of them are already adding various AI integrations to their software suites. But the reality is that it’s hard for corporations to restructure for a new era, in this case, the era of AI-based solutions. The innovator’s dilemma will force them to milk their SaaS model until it’s too late to catch up with competitors. However, the competition does not come from new startups, but from their current customer base, which may simply stop using their services.
So, in a world where code is cheap and AI is taking over, there’s only one question left: who’s next to go? Maybe your favorite SaaS. But don’t worry, as you read this article, our new AI agent is already developing its replacement. Or at least trying.
To accelerate the development of your business and significantly improve business processes, start by integrating advanced AI solutions from Neuro Plume. This will allow your team to focus on priority tasks, increasing overall productivity and work efficiency. Our AI models are easily integrated with existing systems, providing flexibility and scalability for your business.