In the 2010s, Software-as-a-Service (SaaS) revolutionized businesses with its predictable revenue, streamlined deployments, and user-experience (UX) centered platforms.
Today, a new technology curve is challenging those foundations: agentic AI. While some flirt with the idea of the end of SaaS, this moment is better understood as a strategic reframing.
SaaS founders shall ask a sharper question: Is my company building technology that agents can amplify or one they’ll bypass?
Understanding that distinction is now central to both product strategy and M&A positioning.
“This transformation is more than incremental. It redefines the relationship between how work is designed and how work is executed.”, explained tech experts Deep Nishar and Nitin Nohria in Harvard Business Review.
Agentic AI refers to software agents capable of independently reasoning, making decisions, and completing multi-step workflows. Unlike simple automations or chatbots, these agents pursue goals, adapt in real-time, and work across systems.
These systems operate more like autonomous collaborators than software tools.
An example from IBM reads:
“In healthcare, agents can monitor patient data, adjust treatment recommendations based on new test results and provide real-time feedback to clinicians through chatbots.”
According to the Nielsen Norman Group, “it’s likely that AI agents will gradually augment or replace traditional support staff and interact directly with users' personal AI assistants”.
A real-life example is Operator, OpenAI’s agent that can perform tasks for you on the web.
“Operator can be asked to handle a wide variety of repetitive browser tasks such as filling out forms, ordering groceries, and even creating memes.”
Software as a service (SaaS) delivers software via the cloud with human users interacting through dashboards, menus, and forms. Its value proposition rests on recurring access, usability, and centralized feature sets.
Companies like Salesforce and Atlassian scaled by owning user workflows. However, if agents can bypass interfaces entirely and trigger backend functions through Application Programming Interface (APIs), then the user interface (UI), the core of many SaaS advantages, becomes optional.
Technological changes have historically led to changes in mergers and acquisitions (M&A). What’s unique about this one is how quickly it’s shifting the definition of value.
Traditional SaaS earned its value through intuitive interfaces and recurring usage, advantages that still matter. However, as agentic AI systems become increasingly capable of interacting directly with APIs, buyers are also beginning to assess how well a product integrates into an agent-driven workflow.
This doesn’t diminish the value of strong UX or engagement metrics, but it does add new layers to the conversation about deal value. Companies that pair UI excellence with modular, agent-compatible architecture may find themselves especially well-positioned today.
Agentic AI does not leave SaaS obsolete. It does, however, change what makes a SaaS company valuable.
For a long time, a superior User Interface (UI) and User Experience (UX) have been key differentiators in SaaS companies. A beautiful, intuitive, and easy-to-use dashboard or interface could make a product more appealing, lead to higher adoption, and create "stickiness" (making users reluctant to switch).
AI agents don't need dashboards because they operate via APIs. They prioritize speed, reliability, and clear documentation over visual design. For these systems, your product's' user experience” refers to how efficiently agents can accomplish tasks through structured interfaces.
Software suites that consolidated many related features were often seen as more valuable (e.g., Microsoft Office, Adobe Creative Suite). The idea was to provide a one-stop shop, improving workflow efficiency by having everything tightly integrated in one place. This bundling created a strong competitive advantage.
Agents can now dynamically compose workflows across multiple services using APIs. They don’t need a pre-integrated bundle because they create their own toolchains.
High user engagement (e.g., daily active users, time spent in app, feature adoption rates) has long been a key indicator of a product's success. High engagement was thought to build a strong moat or strategic defensibility because it implied users were deriving significant value and were deeply embedded in the product.
What is changing
If agents can generate the same output by calling a few APIs, then human usage metrics may lose value. The outcome is what matters, not the hours spent achieving it.
Agentic systems don’t just replace software, they reconfigure the layers that matter. Founders must adapt at multiple levels:
L40° helps founders stay ahead of the disruption of agentic AI in SaaS. We understand both the technical inflection points and the deal dynamics, and we work with you to reshape your narrative before market forces dictate your actions. If you’re reevaluating your position or think you should, speak with an L40° advisor. Contact us today.
