I’m writing this post in a dialogue with Claude. I’m not just querying, coding, or automating. I’m drafting, refining, and even rewriting my thoughts via a dialogue with AI. I’m no longer looking for some kind of “perfect writing app.” My thinking environment is now a conversation. What does that mean for SaaS and software broadly?

SaaS is becoming a shim

Software companies sell tools. Tools presuppose a human operator. If the operator is an agent, the tool is an implementation detail.

Take Figma. Figma’s brilliance was making design collaborative and browser-native. But if an agent can go from product spec to production-ready design in minutes---and Anthropic’s Claude Design suggests this is months away---then Figma’s value proposition changes. You don’t need multiplayer cursors if there’s no human designer collaborating. The agent doesn’t need a GUI. It needs an API, or more likely, it just writes code directly.

The same logic applies across the stack. Project management tools presuppose humans coordinating work. Analytics dashboards presuppose humans interpreting data. CRMs presuppose humans managing relationships. If agents do the underlying work, the tool layer compresses into a thin shim between the agent and the outcome.

Adobe is the starker example. Photoshop, Illustrator, Premiere---these are instruments. Instruments are only valuable if someone is playing them. If an agent can produce the same output without the instrument, the instrument becomes a legacy cost center. Adobe has been bolting AI features onto Creative Cloud, but that’s adding a motor to a horse. The horse is the problem.

This doesn’t mean every SaaS company dies tomorrow. But the value of the software layer is collapsing. What used to be a product is becoming a feature of the AI platform.

What survives

What agents can’t replicate is more interesting than what they can.

Physical infrastructure

Cloudflare has edge nodes in 300+ cities. AWS has data centers with custom silicon. Twilio has contracts with carriers in 180 countries. You can’t vibe-code a point of presence. These companies become utilities---low-margin, high-volume, essential. They survive, but they stop being “tech companies” in the venture sense and start looking like power companies.

Human networks and the data they generate

YouTube has billions of hours of video. Instagram has billions of images. Google Maps has billions of user-contributed corrections. LinkedIn has the professional graph. Airbnb has the hosts. The moat is the same in every case: billions of humans using the product day-in and day-out, generating data that no agent can replicate from scratch. An agent can use this data but can’t generate it.

These platforms face a strange future though. If agents are doing the transacting---booking the Airbnb, searching the listings, watching the videos---then the platforms become agent-to-agent marketplaces with human assets underneath. The software layer becomes trivial. The value is the humans and the data they’ve already produced.

Regulatory capture

Not regulatory licenses---agents can generate applications at massive scale. What matters is regulatory capture. In the past, a dozen banks per state applied for licenses in any given year. When agents can generate applications, that scale multiplies faster than the government can adapt. Governments will inherently react---through action or inaction---by favoring incumbents. The banks, insurers, and broker-dealers that already hold the licenses will be protected not by the difficulty of applying, but by the bottleneck of a bureaucracy that can’t process a thousand applications where it used to process ten.

Taste

This is the most interesting survivor. Linear will endure because Karri Saarinen has a vision of how software teams should work and Linear is the embodiment of that vision. Their refusal to add custom fields for years wasn’t a product gap---it was an argument that custom fields are where processes go to metastasize. That’s not UX polish. It’s ideology encoded in software.

An agent can replicate Linear’s UI in a weekend. It cannot replicate the conviction about what should and shouldn’t exist. Software-as-opinion---Linear, Basecamp, Notion---is durable because customers are paying for someone to tell them no, to shape their thinking, not just execute their commands.

Humans will pay a lot for taste---or at least the perception of it. Louis Vuitton and Ferrari are incredibly valuable companies despite their products being vestigial. But no one has a monopoly on taste. Linear will be worth billions, but never trillions.

Most SaaS products don’t have taste anyway. They have feature checklists. They’re undifferentiated CRUD apps with a billing page. Those are the ones that evaporate.

Margin compression

If agents can replicate any SaaS product’s functionality, margins compress to the risk premium of building it yourself. There’s always some margin---building it yourself carries legal and financial risk, and agents, being non-deterministic, can’t guarantee 100% uptime. But those margins might collapse from 80% to 50% or even 20%.

The winners survive as massive “lambda-as-a-company” machines: a few skilled humans making taste and strategy decisions, with agents doing everything else. Value accrues from breadth of usage, not thickness of margin. Software becomes the rotisserie chicken---sold near cost to keep customers in the ecosystem.

The companies with moats in atoms (infrastructure, carrier relationships, regulatory capture) or in accumulated human data will weather this. Pure software companies whose value is “we wrote code that does X” will not.

Human compression

It’s not just software that compresses. It’s the humans inside companies.

When each person has 100 agents behind them, a 10,000-person workforce becomes 100. “Replaced” is the wrong word for what happens to any individual---their productivity gets multiplied until fewer individuals are needed. But from the perspective of employment, the distinction is academic.

HR---the managing masses of humans as resources function---disappears. When all that remain are stakeholders and agents, you don’t need an org chart. You need a liability structure and a shared taste for what you’re building.

Could 100 people manage Facebook’s properties? Probably. What changes is the composition: a small core of humans with exceptional judgment about where to point the agents, and an army of agents executing.

What’s left

When anything can be built, the only question is whether what you’re building is worth building. That was always the question, but tools were slow enough that most of us never had to face it. We could hide behind the difficulty of execution. Agents remove that place to hide.

What remains is taste---the willingness to have a point of view about what should exist and what shouldn’t. That’s not a software problem. It’s a human one.