The value in software is shifting from SaaS platforms (like CRMs) to the AI agent layer that automates work on top of them. This will turn established SaaS companies into simple data repositories, or "hooks," diminishing their stickiness and pricing power as agents can easily migrate data.

While users building their own tools is a risk, the more profound disruption comes from AI agents performing knowledge work autonomously. This could eliminate the need for human-centric software like project management tools entirely, as agents handle tasks, tracking, and completion without manual input.

In SaaS, value was delivered through visible UI. With AI, this is inverted. The most critical, differentiating work happens in the invisible infrastructure—complex RAG systems and custom models. The UI becomes the smaller, easier part of the product, flipping the traditional value proposition.

AI tools enable users to create bespoke applications tailored to their needs. This shift towards personalized software challenges the one-size-fits-all SaaS model, potentially rendering many subscription products obsolete and causing market underperformance, as seen in the Morgan Stanley SAS index.

AI is becoming the new UI, allowing users to generate bespoke interfaces for specific workflows on the fly. This fundamentally threatens the core value proposition of many SaaS companies, which is essentially selling a complex UX built on a database. The entire ecosystem will need to adapt.

For decades, buying generalized SaaS was more efficient than building custom software. AI coding agents reverse this. Now, companies can build hyper-specific, more effective tools internally for less cost than a bloated SaaS subscription, because they only need to solve their unique problem.

Turing's CEO claims SaaS is dead for two reasons. First, powerful foundation models drastically lower the cost of building custom software internally. Second, existing SaaS products are built for human interaction via GUIs, not for AI agents that will increasingly use APIs and tool-calling functions directly.

AI agents can easily siphon off value from SaaS products priced on per-seat utility by automating tasks previously done by humans (e.g., support tickets). In contrast, deeply embedded systems of record (ERP, CRM) are insulated by career-limiting switching costs and the immense challenge of migrating timeless, critical data.

SaaS value lies in its encoded business processes, not its underlying code. AI's primary impact will be forcing SaaS companies to adopt natural language and conversational interfaces to meet new user expectations. The backend complexity remains essential and is not the point of disruption.