[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.