[hippo22]

It’s worth asking: what do Wall Street traders know about building software companies? Almost nothing. Anyone who has attempted to start a startup knows that the software is always the easy part. Building the business is hard. The notion that we’re going to undo 100K+ years of specialization just so that companies can run mediocre, buggy versions of SaaS tools just to save a few bucks is crazy to me.

SaaS stocks are currently the buying opportunity of a lifetime.

[outside1234]

Also, has nobody thought about operations? I pay SaaS companies so I don't need to think about operations. It is insane to me to think that people think a restaurant company is going to suddenly want to get into managing the operations of its vibe coded accounting app. Absolutely not.

[nerdsniper]

Yes, I’m very aligned with “minimal dependencies, live off the land, roll your own” to avoid lock-in and vendor bullshit. Shit I’d rather rent baremetal from Hetzner than VPS from EC2/GCP/etc if I have enough workload to justify it.

But for my startup I still use a ton of SaaS services for things that I could probably do just fine myself. (Clerk/StackAuth, Supabase/PlanetScale, Cloudflare STUN/TURN, Clickhouse, Vercel, Calendly, Google Workspace, ngrok, Tailscale).

Spiritually, I hate using these. Any one of these would be dead-simple to replace. But my time is genuinely better spent on my startup’s particular value-add. Maybe I’ll replace these some day when we can hire someone to manage internal replacement services - some of which are as easy as “a postgres database” or “wireguard on some VPS instances”. But it’s just not worth my time right now when I’m focused on building revenue.

Even if they all cost $300/mo in total, and we’re bootstrapped, it’s a lot easier to cut back on UberEats or shiny nerdy toys than it is to replace all of these SaaS offerings. I recognize there’s a lot of ”I don’t know what I don’t know” and I’m liable to subtly misconfigure something in a potentially disastrous way.

[nradov]

There's enough unhappiness with commercial SaaS EHRs that I expect as few health system CIOs will decide to operate their own vibe coded replacements. This won't work out well for most of them but I think it's going to happen.

[walt_grata]

Or how you'll get all your data out and imported into your custom system.

[marcus_holmes]

We spent the last 20 years building a whole set of specialised little tools on the web to do specialised little tasks for businesses.

Now an LLM can do most of that, easier, and effectively for free. The first pass on a new problem is not googling to see if there's a SaaS for that, it's prompting an LLM to see if it can do it, or if it can build a tool that can do it.

Case in point: in my job we have to data-enter invoices. I have dealt with or in this industry for 30-ish years. I worked on various projects trying to get computers to read invoices, to various degrees of success. It's a hard problem; there's no standard format, or layout. Every company does its invoices differently. Some are Excel files, some are PDFs, some are Word docs, etc.

This entire problem vanished this year. You get an LLM to read the invoice. It does this more accurately than humans do. Job done.

There are entire SaaS businesses that read invoices that are now obsolete and have no moat.

[hippo22]

I think that’s different. You have a problem: invoice management. LLMs have made that cheaper and you should expect disruption. But you’re not building your own invoice scanner. You’re using another, cheaper product on the market.

However, the hypothesis in the SaaS market is that LLMs have made software have zero value and therefore the SaaS companies will be less profitable. That’s like if wood was suddenly free, expecting home builders to go out of business. If anything, home builders are going to do better, because they can apply their expertise while deploying capital elsewhere. We should expect software companies to be more profitable, not less.

Of course, there are exceptions. Sometimes AI replaces the product itself, e.g. image generation models vs. contractors on fiverr.

[nradov]

There has been a standard X12 EDI format for invoices for decades. It's kind of a hassle to work with but it can at least be reliably parsed. A lot of huge businesses like Walmart use it successfully, and even require their suppliers to submit all invoices that way.

I don't object to using LLMs to parse PDFs but over the long run it's going to be less efficient and reliable than other options.

[marcus_holmes]

Yes, there has been a standard format for invoices for decades, but it was only ever used if both companies were using a ERM system (and as you say, large enough purchasers could force their suppliers to). We have to deal with small business who don't use the standard format, which is the vast majority of them.

Please go ahead and try parsing non-standard invoices without an LLM. I spent 20+ years on and off dealing with this problem. It's not as simple as it looks. And then LLMs came along and made it simple.

[tootie]

Anecdotally, my partner does experience design for fintech systems akin to Bloomberg for a particular niche. They do the standard lifecycle of user research, design iteration in figma, handoffs to devs and all that. The tech department at this company has also been building OpenAI integrations for more than 2 years and are neck deep in LLM technology doing exactly what this thread describes. My partner is still doing exactly the same work she's been doing the entire time and getting the same level of adoption for all the bespoke UI development while the chat interface is just kinda there. I'm sure it's getting usage for some tasks, but it's supplemental.

[brightball]

> SaaS stocks are currently the buying opportunity of a lifetime.

Is anything down far enough to look like the opportunity of a lifetime right now?

There were some deals out there over the last few years. I still kick myself on a daily basis for not taking Carvana at $5 in 2023.