The Future Of Enterprise SAAS

It will suck less

People are unsure of what the inevitable huge disruptions AI will bring to software will eventually be, but one thing which is clear is that enterprise software as a service will be hard hit. The industry is producing products which are too awful, and is too bottlenecked on software development costs, to not be completely upended.

The way that industry works currently is that there’s generally a single dominant player in each niche which has a codebase with a million features ten of which are important. The problem is that every one of their customers uses twenty features: The ten which are important to everyone, and ten others which are important to them specifically. And which ten long tail features each customer cares about have very little correlation to each other.

It’s clear that million dollar a year saas contracts are going away. It’s becoming way too practical for customers that large to write their own bespoke solutions from scratch and wind up with something which sucks less. But that doesn’t mean everybody is going to write everything completely from scratch. Most likely there will be open source solutions for most problems which only have the ten big features and everybody vibe codes customizations for their their own deployment.

The open source business model for this is time honored and straightforward: The company maintaining the open source version also has a service where you pay for deployment. But now it’s even better, because they’ll have a vibe coding interface which is super trained on ten thousand other customizations of their codebase. They’ll likely even sneak in some human intervention in the background to help with rebasing when a new release of the base product comes out. And they’ll have a license which allows and all customizations to be upstreamed if the maintainers want them to be. There will probably be niche consultancies which specialize in helping companies do customizations of specific products but that won’t be done in house by the maintaining company because saas shops will still try to maintain high capital efficiency.

The whole saas industry is much more vulnerable than people realize. You could get me to switch off Jira just by making a comparable product which had page load times out of this century. And vibe coding will absolutely be at the core of the new way of doing things.