The SaaS playbook is being rewritten as AI commoditizes software and investors demand efficiency over growth—founders must now prove durable customer value, not just hypergrowth.

What happened: Investors and founders are rethinking the traditional SaaS model because LLMs are commoditizing many AI-native SaaS products before they scale, and some VCs are advocating for hybrid models that combine software with services. The growth-at-all-costs mindset is gone, replaced by focus on capital efficiency, retention, and Rule of 40 metrics.

Why it matters: For 30 years, SaaS founders could rely on predictable revenue, high gross margins, and strong net revenue retention to attract investors. That stability has shifted; the bar has moved from 'Can this company grow?' to 'Can this company grow efficiently, retain customers, and compound value as it scales?' Investors are now skeptical of AI novelty and want proof that AI creates durable workflow ownership, not temporary experimentation.

What to watch: Pricing models are moving away from seat-based toward usage-, consumption-, and outcome-based pricing, because AI performs work independently rather than just helping employees. Founders must also demonstrate a clear moat, because promising AI categories are attracting 2x to 3x more competitors than in prior years while large SaaS incumbents are aggressively launching AI products and acquiring startups.