Previously, the high cost of software development meant products needed to achieve scale to be successful. AI lowers this barrier, making it practical to build custom applications for very small, niche audiences (e.g., a Super Bowl app for 15 family members) that were never financially viable before.

AI is creating a "software creator" economy analogous to YouTube's video creator boom. By drastically reducing development costs, AI tools make it economically viable for solo founders and small teams to build businesses serving smaller, niche markets that were previously unprofitable to address with traditional software teams.

AI has reduced software development costs so much that serving niche, un-computerized industries (like ice rink management) can create multi-million dollar businesses without raising venture capital or building a large team.

Contrary to the belief that AI will kill most apps, lower development costs will make it profitable to build and maintain software for smaller, niche audiences. This affordability will likely lead to an explosion of specialized apps rather than market consolidation.

AI is democratizing software development by enabling non-technical subject-matter experts to build their own tools. By simply describing their ideas, they can generate fully deployed applications, shifting value from technical implementation to market and community insight.

Individuals will use AI to build bespoke software for personal use. A subset of these tools will find a niche market, creating entrepreneurs who operate outside the VC-funded, subscription-SaaS model, potentially favoring one-time purchase models due to low development costs.

Just as YouTube created more jobs than television lost, AI will lower the cost of software creation so dramatically that millions of new, highly specialized SaaS businesses will emerge. These new companies can be viable with as few as 500 customers.

AI is drastically reducing software development costs. This makes it economically viable for small teams to build highly-focused applications for niche markets, such as specific skilled trades, that were previously too small to attract venture capital-backed software companies.

AI will decentralize entrepreneurship by enabling solo founders to build software for niche markets. These small markets, often dismissed by VCs, can support highly profitable lifestyle businesses for individuals, creating a new wave of company creation outside the traditional Silicon Valley model.