Key insights
- The author argues that Anthropic's Claude Design release highlights the increased competitive risk for SaaS companies due to AI. They believe AI-driven competition will compress SaaS valuations and favor companies with access to compute and energy resources. The author recommends focusing investments on compute (TSMC, NVDA) over SaaS, anticipating AI agents will disrupt traditional SaaS business models.
https://www.anthropic.com/news/claude-design-anthropic-labs
This is a warning to those who think SaaSpocalypse is over and SaaS stocks look like value play.
This release proves 2 things:
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Given a few experts controlling an AI, you can build a competitor very quickly. Anthropic just did. You do not need hundreds of engineers and years of R&D anymore.
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Those who have access to smart models, chips, and energy will win. Invest in these companies. They're going to be winners no matter what.
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You simply can't compete if you do not heavily leverage AI in your business. A business that fully embraces AI will destroy a business that does not. I'm sure the people who built this inside Anthropic are pretty good at using AI.
That said, not all SaaS are the same. If it's a SaaS that AI agents will use a lot more, then those will pop. If you do not have expertise in selecting them, just stick to energy and compute companies. I suggest TSMC and Nvidia as your base investments. They should be a large percentage of a your portfolio. Then you can go a ahead and gamble on some other SaaS that aren't easily replaced and will be used by AI agents.
I'm a software developer and I personally do not invest in any SaaS companies. It's not that I think SaaS companies will be made obsolete (some will). It's just that they will not command high PE ratios anymore since it's much cheaper now to build a competitor given the right expertise and compute. I invest in compute & energy stocks only.