If every company is figuring out an AI strategy in 2023, why GTM and growth is still many SaaS founders' top concern?
This is one of my key takeaways when I read OpenView's 2023 SaaS Benchmark report and Battery Ventures' State of the OpenCloud report side by side.
If you watch many of the brand new fastest-growing AI-native products, they are almost all consumer-facing: for example, one of the biggest AI native products, Midjourney has 20M users and $300~400M ARR. But it still faces significant risks from both sides - LLMs such as ChatGPT or incumbent players such as Adobe.
There haven't been a lot of brand-new B2B AI products, many successful examples are AI enhancements on top of existing players: think about GitHub Copilot, 100M paid users, over $100M ARR. Jasper might be considered an example of an AI native B2B product, but because it doesn't occupy a workflow, it is more like a point solution that faces similar risks as Midjourney does.
So for many SaaS founders, the first priority is still penetration, market share, and occupying that key workflow within more companies. While AI provides a potential opportunity and wedge to achieve that, it is easier to add AI enhancement on top of an adopted workflow and system of records, vs. the other way around, at least in the near term.
Eventually, will there be completely AI-native B2B applications that re-invent the entire workflow? I would imagine so but we need to see bigger changes in how we work first. What do you think? What's your perspective on this?
Link to both reports in comments.
Platform Design Cofounder at Boundaryless | Cofounder at Scuter | Driving Collaborative Growth in Venture Capital | Resident @TreeoVC
3wand the next wave will be AI2AI SaaS, replacing the B2B concept :)