3min chapter

Startups For the Rest of Us cover image

Episode 663 | 5 Insights SaaS Founders Should Know About A.I. (Ignore at Your Peril)

Startups For the Rest of Us

CHAPTER

Evaluating the Risks of Obsolete Business Models in SaaS

This chapter explores the vulnerabilities of traditional SaaS business models amid advancing AI technologies. The speakers stress the need for companies to innovate and adapt their strategies to remain competitive and avoid obsolescence.

00:00
Speaker 2
let's move on from there to the fifth point. And this is one I'm sure you've thought about. So I'm curious. I think we both agree on it. But the question here that I would ask myself as a founder is, is my business model a ticking time bomb? Because some businesses are, you know, if you're a big team of analysts presenting data and you're doing a bunch of manual work and you're summarizing things, like that becomes, like you said, what was it? The three week report becomes a two day thing? Well, once anyone can do that, that's a problem, right? So how should founders, what should they be thinking about? And how can you escape that? Right? How can you not let your business basically be completely deprecated by AI in those cases? It's not everybody. But there is a subset of SaaS out there.
Speaker 1
There are. And I think like, if the use cases where you have, again, like maybe before a part of your moat was, oh, this is really dirty data. It's hard to deal with. It's imprecise. Like it requires verification. So you end up like, you know, outsourcing to a call center in the Philippines or an on call center. But like outsourcing, you know, overseas and you're paying people to do textual analysis or updating reports manually because it's like super hard to do with the existing technology. I think that particular model, I think, if that was my moat, if that's what I did, I would be worried. I don't necessarily think it's like, it's here's the thing. It sort of relates to what LMS are bad at. Like, you can't have it like, people say, oh, you know, I can't do, you know, math. I can't do two times to the power eight, times whatever, six, whatever, right? That does not like, yeah, but that's what it does. Like, that's just a calculator. It doesn't matter. That's what it's good at. What it's also, another thing is not good at is like queries like all the, give me all the whatever it is in the world. Like it doesn't, it doesn't do well at that just because like, that's not what it's good at. That's not like being able to iterate every road in a database. It's not something that it's, that it's really good at. And so I think the moat that exists from building out and managing and quality assurance on a team of people in the Philippines say, I think that's going to go away. But that doesn't mean I think that the entirety of those businesses are like just three lines of code and chat GPT anymore. It just becomes a different, it just becomes a different moat. And if you lean then too heavily on that existing moat, then yeah, I think you'll, I think you'll be out competed. But I think a lot, like, this is what I'm saying is like, for those kind of businesses, it makes sense to sit down and say, okay, let's just admit that this particular thing is no longer a moat. What can we do given the capabilities that we already have and the customer relationships and like the understanding on how we get that data? Like, what can we build? Like, it's almost like, yeah, you kind of like, if you've been sort of cruising along on that moat by yourself, you're going to be in trouble.
Speaker 2
Right. And I'm here less to be, what do you

Get the Snipd
podcast app

Unlock the knowledge in podcasts with the podcast player of the future.
App store bannerPlay store banner

AI-powered
podcast player

Listen to all your favourite podcasts with AI-powered features

AI-powered
podcast player

Listen to all your favourite podcasts with AI-powered features

Discover
highlights

Listen to the best highlights from the podcasts you love and dive into the full episode

Discover
highlights

Listen to the best highlights from the podcasts you love and dive into the full episode

Save any
moment

Hear something you like? Tap your headphones to save it with AI-generated key takeaways

Save any
moment

Hear something you like? Tap your headphones to save it with AI-generated key takeaways

Share
& Export

Send highlights to Twitter, WhatsApp or export them to Notion, Readwise & more

Share
& Export

Send highlights to Twitter, WhatsApp or export them to Notion, Readwise & more

AI-powered
podcast player

Listen to all your favourite podcasts with AI-powered features

AI-powered
podcast player

Listen to all your favourite podcasts with AI-powered features

Discover
highlights

Listen to the best highlights from the podcasts you love and dive into the full episode

Discover
highlights

Listen to the best highlights from the podcasts you love and dive into the full episode