If you believe the headlines, the SaaS doomsday clock is ticking ever closer to midnight.
Whether or not it strikes 12, it remains to be seen if well-funded SaaS startups will suddenly turn into pumpkins.
There is genuine panic in the world of SaaS. AI threatens to outsource valuable code, and even replace software entirely.
Much of that panic is being shaped by Big Tech companies, Silicon Valley investors and public market jitters. But for European startups, the picture is a little more nuanced.
Many operate in narrower verticals, with closer customer relationships and a stronger emphasis on capital efficiency. That changes how exposed they really are to the SaaSpocalypse — and how they should respond.
It might feel like an entirely new phenomenon, but the truth is we’ve been here before. My company, Jacquard, has provided AI-generated copy for enterprise companies since 2015 — so when ChatGPT came along in 2022, we should have been toast.
But we’re still here.
Despite the name, SaaS has never truly been about software. The strategies that allowed us to succeed are conceptually simple and, thankfully, replicable.
Below are eight tips for any SaaS company looking to not only weather the storm, but come out even stronger on the other side.
The value is in the output, not the input
Think about where the value of the software service you provide really sits: the output. The companies in trouble are those whose product value is the interface, such as the drag-and-drop or the workflow abstraction.
Agentic AI can now automate that interface. But if your value is the output your software achieves, you’re in a fundamentally different position.
Learn to tell your story better
It’s no good identifying where the value sits if you’re not explaining it to people. The SaaSpocalypse is driven by a specific narrative — it’s reliant on the idea that as the barrier to entry for building software trends to zero, the need for SaaS companies is going to be eliminated.
Markets are responding to this idea, rather than looking at the fundamentals of SaaS companies.
If you’re in SaaS, make clear to your customers why you’re irreplaceable and help to shift the prevailing narrative. Ignore those cardboard “The End is Near” signs and work to get your messaging out there.
Make your clients feel special
People constantly underestimate the “soft” dimensions of SaaS: it isn’t just about software. The other S in SaaS is just, if not more, important: service.
Service, subject-matter expertise, embedded processes and outsourced liability cannot be replaced by code.
Be ready to take the flack. It's what you’re paid for.
Sure, your client could hire engineers and build the tech stack in-house. But when they hire you, part of what they’re paying you for is outsourced accountability.
When or if something goes wrong, you take liability, not them.
AI can’t replace that. Companies might want AI agents to automate internal processes, but they baulk at the idea of trusting them with the millions in value the right software can provide.
Remember the bobsleigh
Several companies, having seen the influx of competent AI agents, now believe they can just build SaaS tools entirely in-house.
It reminds me of the Winter Olympics. We’ve all had a friend who says, between bites of pizza, “I could do that!” Well, newsflash: they can’t — and the same principle applies to SaaS.
Any good SaaS will make the task achieved look easier than it actually is. In the same way your friend on the sofa is ignorant of the athlete’s thousands of hours of training, your customer can’t see the depth of data supporting your software, or the subtleties and nuances underpinning your expertise in the industry.
Embrace AI; don’t fear it
AI agents can actually make SaaS more effective.
If a fleet of AI agents can use a software tool and its underlying data structures, then the ROI on that tool actually increases. By working with the technological shift, you’ll be able to offer more. Human hours spent on the software will decline, but the output — the real value you offer customers — will go up.
Focus on what can’t be vibe-coded.
There will be powerful parts of your tech stack that AI will gradually render redundant: that’s a reality facing any company currently.
But that doesn’t mean you need to automate everything. Focus on what makes your software work: the deep wells of data your tools draw on; valuable customer insights that have materially changed processes.
None of these can be replaced by AI. No AI tool can simulate millions — if not billions — of discrete, real-world data points. Figure out what makes you irreplaceable, and double down on it.
Don’t give in to the doomsday narrative
This isn’t a call to bury your head in the sand. But please take the SaaSpocalypse narrative with a healthy pinch of salt.
Many software companies are still growing their revenue and margins, yet their share prices are falling as the current apocalyptic narrative gains traction.
It's worth noting that much of this panic is being driven by US public market dynamics — sky-high valuations built on hype cycles that were always due a correction. European SaaS companies are getting caught in the same downdraft, but the fundamentals here are often stronger: more capital-efficient, closer to customers, and less reliant on the growth-at-all-costs playbook that inflated those valuations in the first place.
If you're a European SaaS operator with solid fundamentals, don't import someone else's existential crisis. The correction happening in US public markets isn't a referendum on your business, but a referendum on theirs.
There’s value to not giving in. Make changes, yes. Think and adjust, certainly. But don’t buy into the apocalypse narrative. These narratives have come and gone over thousands of years of human history, and we’ve survived.
SaaS will survive too.
Toby Coulthard is CPO at Jacquard, a platform that writes copy for e-commerce sites
