AI is real and it’s coming, but I hear a different story from each SaaS CEO I talk to about AI within their up-and-running business.
A technical SaaS founder with a $20M ARR software business told me last week that “AI is like teenage sex. Everyone is talking about it, and very few people are doing much with it yet.”
Some are optimistic and exploring to find big wins, but they are only finding smaller practical use cases that help grow productivity. It’s only a matter of time before tools develop and bigger leverage emerges, they say.
Others are skeptical and procrastinating, with their dev leaders and teams hesitant to do much with AI. The CEO is struggling to move each department onto the escalator of AI integration and productivity.
We are “between trapezes” when we know the old SaaS paradigm will change, but we aren’t sure what exactly to invest in yet.
A small minority of established software CEOs I speak with are very bullish on AI and are making major investments based on a thesis about their bet-the-company leverage.
And each one has a different story so far about where their big leverage lies.
- “It’s in the data layer that we are rearchitecting.”
- “It’s in the security so our customers can confidently use AI.”
- “It’s in our deep knowledge and passion for our specific industry.”
- “It’s in agents that will get work done.”
- “It’s in our productivity to code, ship, market, and sell much faster.”
Things will change for established SaaS companies and their products, but it’s not yet clear exactly what each founder should do. Other than to start moving and figure out their approach.
It pays to be optimistic and make practical investments. It still doesn’t pay to bet your company with a big outside investment.
Even VCs aren’t sure exactly how their investments will pay off. Their future is unclear, too.
Most big VCs tell us they aim for one or two $10 billion exit wins, with the rest will flame out. Their Power Law is even more narrow.
It’s not the earliest of days in AI, but it’s not late yet.
Practical software founders are trying things and seeing what works, integrating new technologies, and preparing to move fast when the picture becomes clearer.
And that’s OK.
