There’s been a massive SaaS sell-off since mid-2025. Multiples compressed. Growth stocks punished. The “SaaS is dead” takes are everywhere again.
B2B isn’t dead. Software is still eating the world. Businesses still need tools. Enterprise software spend is accelerating in 2026 at the highest rate in years, and the highest absolute rate ever.
But what is dead is the classic playbook for how you scale and win in B2B and SaaS.
That old playbook worked for 15 years. It made a lot of us a lot of money. And it’s over.
The Old Playbook (RIP, 2010–2024)
Here’s how it used to work. You know the drill:
- One or two players locked up a category by $20M ARR. You’d see Salesforce in CRM, HubSpot in inbound marketing, Zendesk in support. Once they hit $20M, the category was basically theirs. Competitors existed, but the oxygen was gone. The window to win closed fast, and it stayed closed for a decade.
- Massive sales and marketing spend ground you to $100M+ ARR. And it took years. You’d burn $50M, $80M, $120M in venture capital building out a 200-person sales team, running events, doing outbound at scale. The path from $20M to $100M was a 4-5 year slog of hiring AEs, building out channel, layering in CS. Expensive. Slow. But predictable.
- Product was mostly stagnant. Quarterly releases that were really just bug fixes dressed up as features. A genuine platform advance maybe every 5 years. Customers complained, but they renewed anyway because switching costs were brutal and the alternatives weren’t materially better.
- NRR ran on autopilot. Enterprise NRR of 130%+. SMB NRR of 110%+. You didn’t even have to try that hard. Customers expanded because they added seats, because usage grew organically, because your CSM showed up once a quarter and upsold a module. The compounding was almost mechanical.
- Customers happily renewed and kept spending more. “Happily” is maybe generous — but they renewed. Inertia is a powerful force. The pain of switching outweighed the pain of staying. So they stayed, they expanded, and the flywheel kept spinning.
That was the game. Get to $20M first, outspend everyone to $100M, then ride NRR and inertia to a $5B+ market cap.
It worked beautifully. And it’s done.
The New Reality
Here’s what replaced it:
- Prototypes get built in days, not months. A single founder with Claude or Cursor can build in a weekend what used to take a 10-person eng team a quarter. The barrier to creating software has effectively collapsed. This isn’t theoretical — I’ve built 10+ production apps myself through vibe coding, and some have been used hundreds of thousands of times. If I can do it, imagine what a talented technical founder can do.
- AI is creating hundreds of new competitors — and many are dramatically better at agentic functionality. This is the part incumbents don’t want to hear. It’s not just that there are more competitors. It’s that the new entrants are architecturally superior for the AI era. They’re built agentic-first. They’re not bolting AI onto a 2015 codebase. They’re building from scratch around agents that actually do the work, not just assist with it. When your competitor’s product does the job instead of helping with the job, your incremental AI features don’t matter.
- Outliers are hitting $100M ARR in 12 months and becoming budget magnets. We’re seeing companies reach $100M in revenue faster than at any point in SaaS history. And when something scales that fast, it doesn’t just capture market share — it captures budget. It becomes the thing the CFO wants to spend on, which means it’s taking dollars away from everything else. Every dollar that goes to an AI-native outlier is a dollar that doesn’t renew with an incumbent.
- AI is radically expanding functionality and obliterating the prior pace of software development. The old cadence of quarterly releases and annual “platform updates” looks absurd now. AI-native companies are shipping genuine capability improvements weekly. The gap between what a legacy vendor delivers in a year and what a new entrant delivers in a month is widening every quarter. Customers can see it. They’re not blind.
- There’s massive reluctance to buy more products or seats from slow-moving vendors. This is the NRR killer. Customers who used to happily expand are now asking hard questions. Why would I buy another seat from you when your product hasn’t meaningfully changed in two years? Why would I add a module when a new vendor does that function 10x better with AI? The automatic expansion that drove 130% NRR is grinding to a halt for vendors who aren’t shipping real innovation.
- Nobody wants to spend budget that doesn’t show massive ROI almost immediately. CFOs have seen what AI can deliver. They’ve seen the case studies. They know a $50K/year tool can now replace $500K in headcount — if it’s the right tool. So now every renewal, every expansion, every new purchase gets held to that standard. “What’s the AI ROI?” is the new “what’s the TCO?” And if you can’t answer it clearly, you’re not getting the PO.
- Years of price increases have created real frustration — even anger — at existing vendors. This one is underrated. Since 2022, most major SaaS vendors have pushed through 15-30% cumulative price increases. Customers ate it during the boom. But now? They’re furious. They’re looking for reasons to leave. And AI-native alternatives are giving them that reason at a lower price point with better functionality. The loyalty that incumbents assumed they had? It was never loyalty. It was inertia. And inertia breaks when you give customers a reason and a path to leave.
So What Does This Mean If You’re Building?
SaaS isn’t dead. But if you’re still running the 2018 playbook — hire 200 AEs, grind to $100M over 5 years, coast on NRR — you’re going to get run over by a team of 4-50 people with AI agents who ship more in a month than you do in a year.
The winners in 2026 and beyond look different:
They’ll be smaller teams. Way smaller. The company that gets to $100M ARR with 50 employees is coming. Some are already here.
They’ll ship relentlessly. Not quarterly. Weekly. The product will be meaningfully better every single month, and customers will feel it.
They’ll be agentic-first. Not “AI-powered” as a marketing label. Actually built around agents that do real work. The product doesn’t help you do your job — it does your job.
They’ll win on ROI, not on lock-in. The old playbook relied on switching costs to retain customers. The new playbook relies on being so obviously valuable that customers want to stay. That’s a fundamentally different muscle.
They’ll earn their NRR. No more coasting. Expansion will come from genuinely delivering more value, not from adding seats to a product that hasn’t changed.
SaaS is a $300B+ market. It’s not going anywhere. But the way you win in it has changed more in the last 18 months than it did in the prior 15 years.
Adapt or get adapted out.
