The Shift: From SaaS to Agentic AI

The Rise and Reckoning of SaaS

Over the last two decades, SaaS transformed enterprise software. It replaced clunky installs and manual updates with cloud-based tools that could be deployed in minutes. Companies loved the flexibility: pay per user, scale on demand, and collaborate anywhere.

But that convenience came at a cost.

By 2023, the SaaS market had grown to $273B, with companies using an average of 371 SaaS tools. It’s now the third-largest expense for many businesses—behind people and real estate. And the cracks are showing.

SaaS Sprawl and ROI Fatigue

• Post-pandemic, businesses are cutting software budgets by up to 30%.

• Companies are spending $3,500 per employee per year on SaaS—with many tools underused.

• Data silos across tools slow teams down. According to Forrester, knowledge workers spend 12 hours a week chasing fragmented data.

  
  

SaaS was supposed to simplify work. Instead, it’s now part of the problem.

A new model is emerging: Agentic AI—intelligent software agents that act like human team members, not just tools.

What makes Agentic AI different?

• It executes entire workflows, not just single tasks.

• It can reason, plan, iterate, and improve over time.

• It works across systems, eliminating the need for humans to manually bridge gaps.

  
  

Example: An AI agent for HR onboarding doesn’t just send a welcome email. It:

• Sets up systems access

• Triggers payroll setup

• Sends benefits info

• Tracks engagement and performance

• All autonomously, without hopping between disconnected SaaS tools.

A New Business Model: Pay for Outcomes, Not Access

The real revolution isn’t just tech it’s pricing.

SaaS made money by charging per seat. But most seats aren’t used consistently. Agentic AI flips the model: pay for what gets done, not who logs in.

For Example - Instead of paying for 10 HR tools, you pay for each successful onboarding. Instead of licensing support software, you pay for tickets resolved.

This means no more idle licenses and real ROI tied to software spend.

The SaaS Innovator’s Dilemma

Most SaaS companies won’t adapt easily. Shifting to outcome-based pricing threatens their current revenue streams. As a result, many will add AI as a bolt-on—without solving core issues like sprawl or integration.

The real disruptors? AI-first platforms that build horizontally across the organization and price based on value delivered.

The Future is Agentic

SaaS isn’t dead—but its monopoly is. The enterprise stack of tomorrow will be powered by autonomous AI agents that streamline work, reduce waste, and drive measurable results.

Goodbye SaaS sprawl. Hello intelligent automation.