For the last few years, tech and SaaS companies have been drunk on the same idea. Find every way possible to use and implement AI. The result was to replace humans in order to boost efficiency and pad margins. Entire workforce functions were slashed, onboarding, support, customer success, marketing, HR, you name it. And for a moment it looked like a genius strategy. Margins went up as payroll went down.
Fast-forward to 2026, and the tables have turned. The very AI wave that justified cutting human support is now the reason software companies are being questioned, replaced, or re-priced in the market. Today the question these same companies are asking isn’t “How do we use AI to replace humans?” but “How do we survive because of AI?” And the answer is much uglier than their pitch decks from 2018.
AI Agents Are Reshaping the Whole Model
Leading analysts are now saying agentic AI is a restructuring of the value chain. According to Bain’s Technology Report, AI agents can automate end-to-end workflows that used to justify entire SaaS categories, compressing spend or even cannibalizing traditional SaaS value.
To be crystal clear, it doesn’t mean AI is just another tool in the stack. It means AI is rewriting what “software” is for. Moving from seat-based UIs to autonomous work execution of more than one existing SaaS tool.
SaaS’s Two Big Mistakes
Here’s what got SaaS here:
Forgot Why People Bought in the First Place
SaaS sellers used to win because there were humans in the loop. They had onboarding experts, support reps, and success coaches. Those roles helped businesses use the software and help them to grow with it. They moved to support models that basically said, “Good luck, here’s a video and a PDF.” Without the humans, the tools became shiny unused subscriptions.Mistake Interfaces for Value
Many SaaS providers built beautiful dashboards and called them moats. The created bloated feature sets or expensive add-ons that didn’t fit well into existing workflows. But agents don’t need fancy interfaces. They plug into APIs and orchestrate outcomes directly. This means the old model of “logins and seats” feels increasingly irrelevant.
Investors Are Not Happy And Neither Are Customers
The market’s reaction says it all. Software stocks have taken real hits lately as the fear of AI disruption becomes a “priced in” reality, not just speculative talk. Past narratives about rising recurring revenue and locked-in customers feel quaint in light of AI agents that can automate dashboards, reporting, analytics, and more. These were functions once sold as high-value SaaS subscriptions.
Meanwhile, customers feel exactly what every B2B marketer and buyer eventually feels when prices continue to rise but the value doesn’t. Abandoned, trapped by licensing, and under-served by impersonal help centers filling up with “self-service” help articles. You used to get a dedicated customer success manager, now you get a knowledge base and a prayer.
The Ironic Part? SaaS Did This To Itself
SaaS companies aggressively cut human support and replaced people with help docs and bots in the name of efficiency and margins. But AI didn’t magically solve complexity. What it did do was expose how shallow the value proposition had become for many products.
Customers didn’t sign up for UX, they signed up for outcomes and when the humans who helped them get outcomes vanished, loyalty vanished with them.
Now, AI agents are stepping in not as luxury gimmicks, but as DIY AI tools businesses can integrate themselves, cheaply and fast. Giving businesses the ability to build internal chatbots, schedulers, data connectors, and automation pipelines that replicate or replace the “expensive SaaS stack.” And because they’re tailored to their needs, they’re cheaper, faster to adopt, and less frustrating, according to Martin Alderson.
So What Happens Next?
Karma anyone? SaaS’ karma is the market repricing broken promises.
The same companies that removed human guidance in the name of efficiency are now being replaced by systems that are actually efficient.
AI isn’t killing SaaS. AI is just exposing that these companies were never really selling value in the first place. What made them sticky was the support and the guidance. The feeling that someone was invested in your success.
For those who bet the farm on replacing humans to fatten margins? Karma handed them a much leaner lunch.
Follow Moni Oloyede at https://www.linkedin.com/in/moni-oloyede/
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“Karma has an API key” is the best!!!! 👏🏻👏🏻👏🏻👏🏻