Industries with historically low software adoption (like trial law or dentistry) are now viable markets. Instead of selling a tool, AI startups are selling an outcome—the automation of a specific labor role. This shifts the value proposition from a software expense to a direct labor cost replacement.

Customers are hesitant to trust a black-box AI with critical operations. The winning business model is to sell a complete outcome or service, using AI internally for a massive efficiency advantage while keeping humans in the loop for quality and trust.

Founders are stuck in a SaaS mindset, selling tools to existing service providers. The bigger opportunity is to build new, AI-first service companies (e.g., accounting, legal) that use AI to deliver a superior end-to-end solution directly to customers.

Instead of selling AI tools to incumbents (e.g., law firms who bill by the hour), build an AI-first service that delivers the end result directly to the customer. This avoids conflicts of interest and captures more value.

Instead of selling AI co-pilots, legal tech startup Crosby operates as a full-stack law firm using AI internally. This model allows them to continuously re-orchestrate workflows between human lawyers and AI as models improve. This captures the entire value of automation rather than just the limited margin from selling a software tool to other firms.

To penetrate tech-resistant markets like personal injury law, the winning model is not selling AI software but offering an AI-powered service. Finch acts as an outsourced, AI-augmented paralegal team, an easier value proposition for firms to adopt than training existing staff on new, complex tools.

The business model is shifting from selling software to selling outcomes. Instead of creating a tool and inviting users, create pre-trained agents that perform valuable work. Then, invite companies to a workspace where this 'team' of AI employees is ready to start delivering value immediately.

The most durable AI applications are those that directly amplify their customers' revenue streams rather than merely offering efficiency gains. For businesses with non-hourly billing models, like contingency-based law firms, AI that helps them win more cases is infinitely more valuable and defensible than AI that just saves time.

Thrive Capital invested in an AI-powered accounting firm, not an accounting AI software tool. Their thesis is that in some industries, the service provider who uses AI to become hyper-efficient will capture more value than software vendors selling tools to a fragmented customer base. This is a bet on the business model, not just the technology.