UX INSIGHTS: SaaS Is Dead
In December 2024, Microsoft CEO Satya Nadella predicted the end of traditional business applications on the BG2 podcast with Brad Gerstner and Bill Gurley. Nadella noted that SaaS products are “essentially CRUD databases with a bunch of business logic… and once the AI tier becomes the place where all the logic is, then people will start replacing the back ends, right?”
Nadella’s comments echoed a similar discussion that Robb Wilson, CEO and co-founder of OneReach.ai, and Josh Tyson had in September with Janelle Teng, Vice President at Bessemer Venture Partners, on the Invisible Machines podcast. In the conversation, Janelle pointed out that "My infrastructure companies are thinking about how [they] can creatively iterate on business models or interaction parameters to make sure that [their] foundation model can be compatible with different UIs."
SaaS applications are essentially a UI over spreadsheet functions. As conversational AI evolves, custom UIs become less necessary. Rather than pogo-sticking between various graphical UIs, users will simply ask an AI agent to complete tasks. These AI agents serve as a unified conversational interface, facilitating communications with other AI agents, data, systems, and people. This shift is a fundamental change in how we interact with software and data.
AI agents using APIs to operate existing software give users a more seamless conversational experience, reducing the need for task-switching between SaaS products. As Nadella hints, AI agents can access information from various databases, and as they learn to run operations autonomously, the need to manipulate existing software fades.
“You could never have an experience this seamless and efficient while digging through nested tabs or apps — and many of the world’s leading companies are coming around to this fact,” Wilson and Tyson wrote in their bestselling book on AI agent orchestration, Age of Invisible Machines. “Salesforce didn’t just acquire Slack back in 2021. Their CEO openly admitted that they were rebuilding their entire organization around Slack… They're betting that an integrated communication platform and a unifying conversational interface — one machine that connects to everything — will benefit customers, employees, and organizations in big ways.”
That’s not to say that everyone thinks the same way about AI agents displacing SaaS. In a LinkedIn post, Clara Shih (Head of Business AI at Meta) says, “Despite long LLM context windows, structured data still matters for accuracy, access control, and latency. Deterministic workflows are needed for repeatability and control. I actually think SaaS systems of record and workflows may be more important than ever,” adding “I'm rooting for SaaS and either way, 2025 is shaping up to be a watershed moment for the industry.”
Don’t miss this episode of Invisible Machines with Janelle Teng — Stanford scientist turned AI investor at Bessemer — where we explore the agentic death of SaaS!
Watch for yourself as Microsoft’s CEO declares SaaS dead
Age of Invisible Machines, newly revised and updated
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Investment Manager at Antler
1 周SaaS is not dead. AI Agents are SaaS that you buy and implement in processes.
Founder's office @kasplo |Area C4 Director district 121 Toastmasters international |
2 周SaaS isn’t disappearing—it’s transforming. AI will enhance, not replace it, making software more intelligent and integrated. The real question is: how will businesses adapt? Will they leverage AI to strengthen SaaS or risk falling behind? Where do you stand on this shift?
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2 周I am getting this question a lot lately as well. So, I wrote a blog post explaining basically why AI is not killing SaaS: https://procesio.com/saas-is-dead-a-different-perspective/ People thinking SaaS is dead, have here another perspective. What do you think?
SaaS isn’t dead, it’s evolving. For Founders, keep building. And if you feel it's time to exit, list your SaaS on our platform Borderline.xn--biz-ui33b
Chief Product Officer at MARANICS | Bridging Traditional Operations with AI & Digitalisation | Unlocking Hidden Business Value
1 个月I agree with much of what this discussion is about, but also with the broader discussion on how enterprise software is evolving. AI is a key driver of change, but not the only one. While AI reduces the need for complex UIs, interfaces won’t disappear completely. Instead, they will become smarter, more adaptive, and low-code, making it easier to collect and present information where needed. One of the biggest shifts will be that applications move to the data, rather than data always being sent to applications. This means software must be flexible and able to run anywhere—not just as a hosted cloud service. Many companies are looking for more control, better security, and reduced reliance on large cloud providers, which is also pushing software towards more decentralised and edge-capable solutions. The discussion around this shift is really interesting because it’s not just about AI it’s also about how software is deployed, how businesses maintain control, and how different technologies come together to shape the next generation of enterprise solutions. Change is happening faster now, and the companies that adapt quickly will have a major advantage.