From LinkedIn posts to VC chats, I've heard the same refrain: "I can just do that with ChatGPT" — a declaration spelling supposed doom for SaaS. The narrative is seductive in its simplicity: AI and its prompt-wielding masters are seemingly unstoppable, rendering traditional software subscriptions obsolete. Why pay for Xero, Asana, or Dropbox when a few magic words could supposedly build the same solution?
But this notion is more than misguided — it's fundamentally flawed.
The Essence of SaaS is Peace of Mind
Glancing at my Mac's dock, I see Framer, Notion, Miro, Slack, Linear, and a host of other apps that I gladly pay monthly subscriptions for. While I don't celebrate each credit card charge, I recognize the underlying value: convenience.
The essence of SaaS isn't just software — it's peace of mind. You don't need to understand infrastructure intricacies, security protocols, or compliance frameworks. Instead, you pay a fee, and the technology simply works.
AI Output Isn’t Human Ingenuity
What AI currently offers is a facade — a shell that mimics functional software without the nuanced qualities that make applications truly effective. You can use Lovable to generate interactive React code or prompt ChatGPT to help configure cloud infrastructure. But this output isn't the same as human-driven usability, reliability, or meaningful problem-solving.
SaaS Needs to Evolve, Not Die
The current moment for SaaS isn't about extinction, but evolution. After 25 years, the industry has grown complacent, and AI's disruption arrives precisely when innovation is most needed. This isn't a death knell, but a strategic wake-up call.
Humans Make Software Good
AI's greatest strength — and ultimate limitation — is that it's not human. Our humanity drives software innovation in ways algorithms cannot replicate. Emotional experiences — the frustration of a clunky interface or the joy of an intuitive workflow — motivate continuous improvement. These nuanced human insights are what transform good software into exceptional solutions.
Building Software Takes a Village
Consider the behind-the-scenes of every SaaS product: It's never truly "finished." Behind your screen is an entire ecosystem of developers, engineers, product managers, customer success specialists, and support teams constantly problem-solving, iterating, and refining.
One of SaaS's most important benefits is its living, breathing nature. These products continuously evolve, incorporating new features, expanding use cases, enhancing security, and squashing bugs. An AI might generate code, but it takes a human collective to create software that genuinely improves people's work and lives.
Mistakes Will Be Made
The coming years will reveal fascinating dynamics. We'll likely witness AI companies imploding by misunderstanding the fundamental human elements of software (and hardware) dev. We'll see investors fumbling bets, and buyers making misguided decisions to replace robust SaaS solutions with AI-generated alternatives.
We’re Gonna Pay for Convenience
SaaS is not dead and it’s not dying. The AI hype actually serves to highlight the industry’s essential role in delivering the software convenience we’re all seeking. And that convenience is always worth paying for.
