so the share prices of listed American software companies have, on the whole, begun to recover some lost ground (see chart). Yet many investors remain cautious. Their worries are unlikely to dissipate soon, as AI agents that can operate other computer programs become cleverer and more capable. It doesn’t help that the threat to SaaS incumbents is coming from four directions: large AI labs; AI-native startups; DIY software development; and the industry’s own disruptive efforts to reinvent itself. Call them the four SaaSquatches of the apocalypse. It is the AI labs that loom largest over the landscape. Led by Anthropic and OpenAI, they build models with the most advanced capabilities, are raising mountains of capital and employ the leading AI boffins, whom middle-aged SaaS companies find hard to attract. So far their coding efforts—Claude Code and Codex, respectively—have been most notable. But that is only the start. The labs are well placed to take advantage of one of SaaS companies’ big vulnerabilities: their siloed nature. Despite numerous acquisitions over the years, businesses such as Salesforce, ServiceNow and Workday have rarely succeeded in breaking out of their specialisations, or “verticals”. AI labs, by contrast, threaten to move
horizontally, producing agents that operate at a level above the SaaS products, stitching together various programs through plug-ins and a single chat-based interface. Some SaaS applications that were once considered snazzy business tools risk becoming more like plumbing. Meanwhile, AI-native startups are already attacking the vertical dominions of the SaaS giants head on. One type is the industry specialist, such as Harvey, most recently valued at $11bn, which makes AI tools for lawyers and is causing consternation for legal-software stalwarts such as Thomson Reuters. The AI labs are increasingly offering specialised versions of their bots that perform similar functions. Other newcomers offer AI tools for particular business functions. Numerous AI customer-service startups have cropped up, including Sierra, co-founded by Bret Taylor, the chairman of OpenAI and former co-chief of Salesforce. Serval, a two-year-old startup valued at $1bn in December, is taking aim at ServiceNow, which makes software for IT help desks. For the moment Serval’s agents work with ServiceNow’s platform. But the firm’s ultimate goal is to create a fully agentic alternative. Some enterprises will be wary of swapping dependence on one vendor for another. Instead they may opt to harness AI to create their own DIY software systems. The SaaS industry built its success on persuading customers that it is cheaper and easier to buy standardised software programs than to develop custom ones in-house. Software companies ploughed a fortune into building their products upfront, then profited handsomely by distributing them across the corporate landscape at almost no marginal cost. Now, however, enterprises are embracing a “build versus buy” spirit, says Tim Tully of Menlo Ventures, a venture-capital firm. This has progressed well beyond “vibe-coding” simple tools to automate tedious tasks. Kirkland & Ellis, the world’s highest-grossing law firm, recently said that it planned to invest $500m over the next few years to develop AI tools of its own that draw on the expertise of its staff, rather than relying on third-party ones. None of this makes the collapse of the SaaS industry imminent. Adopting new systems is fiddly and slow. And the leading firms still have legions of
salesmen to woo customers at lavish events (try finding a hotel room in San Francisco when Salesforce’s “Dreamforce” is on). Indeed, some corners of the SaaS industry are booming thanks to AI. The share prices of America’s three biggest providers of cyber-security software —CrowdStrike, Fortinet and Palo Alto Networks—are up by an average of 52% since the start of the year, as enterprises spend more to defend themselves from AI-powered hackers. The value of Snowflake, a data manager, jumped by 36% on a single day last month when it reported surging revenue on the back of strong demand for its AI-powered data- querying tool, among other things. Others, however, look more exposed. The share prices of Salesforce, ServiceNow and Workday are down by an average of 34% since the start of the year. All three businesses are built on selling applications to human employees, and rely on a recurring-revenue model in which customers are charged per user, or “seat”. That model, however, is beginning to make less sense as these providers offer their own AI tools to keep up with the disrupters. One problem is that, unlike traditional software, AI agents cost a supplier more as their customers increase their usage. Another problem is that, by replacing human workers, these new tools eat into the revenue that comes from their legacy products. AI agents “don’t need seats”, notes Manny Medina, founder of Paid.ai, the startup behind the flying “SAAS IS DEAD” banner, which sells tools to help developers monetise their agents. Where companies such as Salesforce offer their own AI agents, they typically charge a combination of seat-based and consumption-based pricing, based on how many tokens—the chunks of text processed by AI models—a customer uses. Yet although the revenues SaaS companies are generating from these new products are growing rapidly, they are nowhere near large enough to offset the sales they stand to lose if customers buy fewer of their traditional licences, argues Tal Liani, an analyst at Bank of America. “The risk is cannibalisation,” he says. There lies an irony. Not long ago, software was said to be “eating the world”. Now the danger is that it eats itself. ■ To track the trends shaping commerce, industry and technology, sign up to “The Bottom Line”, our weekly subscriber-only newsletter on global
business. This article was downloaded by zlibrary from https://www.economist.com//business/2026/06/10/fear-of-the-saaspocalypse-is- tormenting-techland
The world’s wealthy are migrating like never before A booming industry of advisers is easing their passage June 11th 2026 THESE ARE unsettling times, even for the rich. Many of those wealthy enough to move abroad for low taxes or their physical or political security are less sure these days about settling in Dubai or Hong Kong, even America or Britain. Dry your eyes, however, for plenty of governments remain eager to take in foreigners with money and skills. And a growing industry of trusted advisers stands ready to help the rich relocate.
For these consiglieri, business is booming. Last year more than 140,000 millionaires migrated, the most on record, reckons New World Wealth, a research firm; this year it expects the figure to rise to 165,000 (see chart). IMI, another research outfit, estimates that the investment-migration industry—which advises both rich would-be expatriates and governments seeking investment and talent—turned over $40bn in 2025, twice as much as in 2019. IMI counts more than 1,200 companies providing investment- migration services. They include law firms, providers of property or investment funds linked to citizenship or residency, accountants and so on. Until Iran struck the Gulf states, a favoured destination was Dubai, home to a fast-growing number of millionaires. One immigration lawyer describes the emirate as the Walmart of the industry, with countless providers and fiercely competitive rates. It has chiefly attracted rich people from the global south: south Asia, but also Nigeria and war-torn Syria and Lebanon. Industry folk now report growing interest in migration among well-off Westerners. Many rich Britons started looking for options after the pandemic. In 2025 they applied to 23 investment-migration programmes run by foreign governments, including America’s EB-5 scheme and programmes in Grenada and Thailand. Elsewhere in Europe, concern about wealth taxes is a prompt. Henley & Partners, a consultancy, publishes an annual list of the
top countries millionaires are fleeing from and heading to. Last year France, Germany and Spain appeared for the first time among the countries that repelled more wealthy inhabitants than they attracted. But the biggest shift is in America—home to more than a third of the world’s people worth $30m or more, according to Knight Frank, a property firm. “The US has gone from a blip to the primary market,” says Ronald Klasko, a lawyer in Philadelphia. In 2024, having spotted that more Americans were seeking advice about foreign citizenship and residency, he set up Exodus Migration, an investment-migration consultancy. He says that most clients are interested in moving to Europe, because they are concerned about America’s political direction, want an alternative residency or want to be able to travel without an American passport. Despite such misgivings, and the fact that America bans some countries’ citizens, it still attracts many rich foreigners. Demand for the EB-5 programme, which requires investment of at least $800,000 in the country, is high—though that may be because the threshold is due to rise to around $900,000 at the start of next year. (Lawyers report “very little demand” for Donald Trump’s “Gold Card” visa, which is priced at $1m per family member and has an uncertain legal foundation.) Many other places are eager to get in on the act. St Vincent and the Grenadines, in the Caribbean, announced in December that it was opening a citizenship-by-investment programme it called a “critical economic pillar”. Uzbekistan, the Maldives and Nauru have all asked Henley to design and develop schemes. Yet the wealthy can find that a warm welcome sometimes goes cold. In January 2025 Spain, once a popular destination, cancelled its €500,000 ($577,000) residency programme in an effort to curb property speculation. In April the European Union’s Court of Justice ruled that Malta’s scheme broke EU law because it “commercialised” citizenship (though the island’s “citizenship-by-merit” programme, which admits entrepreneurs, has since gained traction). In April this year Argentina cancelled a tender to set up an investment-migration programme, issued only in December, which had drawn interest from 11 firms. Last month Portugal extended most migrants’ waiting time for passports from five years to ten.
Many governments are facing pressure to increase the diligence of their citizenship and residency programmes, notes Mr Klasko. The big issue is: “Do you as a country know the background of people who you are giving passports to?” In other words, geopolitical uncertainty does not only trouble the rich. But plenty of countries will take them—and plenty of advisers are eager to help them choose. ■ To track the trends shaping commerce, industry and technology, sign up to “The Bottom Line”, our weekly subscriber-only newsletter on global business. This article was downloaded by zlibrary from https://www.economist.com//business/2026/06/11/the-worlds-wealthy-are-migrating- like-never-before