The new generation of AI automates workflows, acting as "teammates" for employees. This creates entirely new, greenfield markets focused on productivity gains for every individual, representing a TAM potentially 10x larger than the previous SaaS era, which focused on replacing existing systems of record.

Tools are emerging that don't just build an app but run the entire company—managing marketing, bookkeeping, and legal. This evolution shows the value is not in the LLM itself but in the 'harness' built around it to orchestrate complex business functions, creating a new category of fully autonomous company builders.

Specialized SaaS companies like Writer and Intercom are moving beyond simply wrapping OpenAI or Anthropic APIs. They are now training their own foundation models to create more defensible, vertically-integrated AI products, signaling a shift away from platform dependency toward bespoke AI stacks.

Following SEO, App Store Optimization, and social virality, the next major distribution channel is AI answer engines. Product teams must now strategize how to get their brand, features, and knowledge base indexed and surfaced in AI responses, making AEO a critical growth lever for the modern era.

As AI systems become foundational to the economy, the market for ensuring they work as intended—through auditing, control, and reliability tools—will explode. This creates a significant venture capital opportunity at the intersection of AI safety-promoting technologies and high-growth business models.

As large AI models absorb functions of traditional SaaS products, investors and entrepreneurs are shifting focus back to tech-enabled services. Integrating AI deeply into physical services and workflows is now seen as creating more defensible, lasting value than pure software, reversing a years-long trend.

Most successful SaaS companies weren't built on new core tech, but by packaging existing tech (like databases or CRMs) into solutions for specific industries. AI is no different. The opportunity lies in unbundling a general tool like ChatGPT and rebundling its capabilities into vertical-specific products.

The shift to AI creates an opening in every established software category (ERP, CRM, etc.). While incumbents are adding AI features, new AI-native startups have an advantage in winning over net-new, 'greenfield' customers who are choosing their first system of record.

As enterprises deploy agents for critical tasks like RFP generation or invoice processing, they will require dedicated evaluation frameworks and teams. This will create a massive new market for agent observability and eval tools, moving them beyond AI-native companies to the broader enterprise.