Agentic AI threatens traditional SaaS pricing
The bear case for traditional SaaS companies argues that agentic AI and custom-written code will pressure seat-based pricing models and compress operating margins.
The argument
The guest disagreed with Nvidia CEO Jensen Huang's view that AI agents will preserve CRM moots. The guest argued that customers will shift from per-seat pricing to per-use pricing, and IT departments will use AI to write custom software, reducing net expansion rates and lowering terminal operating margins to around 20%.
The thesis, stress-tested
✓ What validates it
- ✓Declining net revenue retention (NRR) or net expansion rates across major SaaS earnings reports
- ✓Enterprise shift toward usage-based pricing contracts
▸ Risks discussed
- ▸Security and integration concerns may prevent enterprises from building custom software
- ▸SaaS giants could successfully integrate AI features to justify price increases
Hear it yourself
"at it recently. I just it's it's an existential question. Like, can can you be a foundry, or can you not be a foundry? Okay. SaaS pocalypse. Jensen has said the bears have this story completely wrong. Agents and agentic AI is actually gonna utilize all of the these CRMs and and corporate software to help people. They're not gonna spin up their own versions. Therefore, these companies"
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