Nico Jeannen: software is the one thing getting cheaper, so people vibe code their own
Nico Jeannen thinks most people haven't noticed how hard the SaaS market has been hit, and lays out three forces arriving at once. AI makes developers more productive, so software costs less to build, which means more competitors and lower prices. On top of that, Nico describes stagflation pushing up the cost of almost everything, and higher interest rates meaning less investment and fewer VCs throwing money around. Add it up and everything gets more expensive except software, and tight budgets give people even more reason to hunt for cheaper options or vibe code their own. The verdict for the SaaS side of the war: it's so over, though anyone who plays their cards well might find it's so back.
Most ppl don't realize what is going on in software/SaaS, the market is totally fucked, any baseline from the last 5 years is gone
There are 3 things going on at the same time:
1) The production cost of software are plummeting. AI makes devs more productive, meaning it takes less labour to create a software (labour being the most expensive part of building software). Cheaper to build = more competitors = prices go down
2) The economy is in a stagflation, meaning inflation (price increase) but without the growth. It's caused by lower supply in oil due to the war = more expensive to buy oil. Oil is used for transport, so everything tied to transport (which almost everything is) becomes more expensive, but it doesn't create growth/profit.
3) The central banks are increasing rates to contain inflation, meaning it's more expensive to borrow money, meaning less investments overall. For startup/SaaS/Tech it also means less VCs throwing money left and right cause they can get good ROI from bonds
So if you add those 3 you get a situation where everything is becoming more expensive for everyone, EXCEPT for software. And now because money is tight, people have an even greater incentive to look for cheaper options/vibe code their own
its so over (but if u play ur cards well can also be so back)
— Nico, read the original on XMore SaaS obituaries
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