You mean the big companies who still haven't moved away from abominations like SAP and Oracle? The ones where you require twenty approvals to get a small pilot done? Instead of moving to saner and cheaper alternatives, they would just say, "hey, why don't we just start making our own software?" Every effort like this—if it had any takers—will fail spectacularly.
I get it people are skeptical about the future. But I can't imagine any scenario where people would like taking responsibility of building and mantaining their own software for everything vs. paying marginal amount of money (relatively speaking) to let someone else take the headache.
I can imagine a future where it will be possible for a family to host their own essential services ... There got to be something between homelabs and cloud services bc the gap is too big.
Good luck. To have something that a regular family could use would require remote access from the company for troubleshooting, updates, maintenance.
So you get all of the downsides of cloud hosting (company employees can still remote in), with none of the upsides (all the hardware is now geographically distributed, instead of one big building) with the privilege of paying for it instead of being "free" like facebook/google.
Yes! All startups are created to solve a problem, regardless of the tools used. Apps are simply tools to solve human problems. Because humans will always have challenges to address, software will remain a vital tool. While AI makes writing software much easier. It's likely to lead to an explosion of new apps. Only those that fill a genuine need will survive. Your job is to identify these new problems and determine which apps to build.
Simple apps are a thing of the past. If an LLM can generate an app in a few sittings, it isn't a saleable product. However, people will still pay for a fully engineered application that solves a complex problem that AI cannot easily replicate.
Regarding copies, there is always room for more than one solution to the same need. Your challenge is to figure out how to stand out. A fundamental business hurdle, that has existed since the beginning.
Here's an idea that always bear's fruit. We humans love to do things as easy as possible. Write something that saves energy, time and is simple then people will pay for it.
This is why I like using mathematical or algorithmic approaches to solve difficult problems. Writing programs that use statistics, mathematics, optimization, analytical geometry, etc guarantee a certain level of security from the swarms of CRUD merchants flooding the market.
Maybe. great businesses don't need moats. They just need sonething people buy from them. Maybe venture capital needs moats - but you can get rich without that. (If rich is even the goal - a nice life is a better goal)
beware of any business where there is no competition - there is generally good reason nobody else is making money there.
It is. Big companies (or really anyone) usually don't have the time to copy an idea unless it becomes too big already. And if your idea becomes too big, it was worth pursuing it.
Or worth buying up. Which in many cases was the "purpose" of doing the startup in the first place.
Sure, we'd all like to think that the goal was an idealistic "startup does things for bettering humankind".
But let's face it: A large amount of startups are literally founded as an "easier" alternative of building a "more agile" sub-organization within an established and more process driven org and then just get bought out by some of those larger orgs.
Whether or not those large orgs are then actually successful in integration and actually properly leveraging what they bought vs. just "crushing competition", is not necessarily the concern of the founders, depending on how ruthless vs. idealistic they are.
"Current business conditions or issues" -- I think that's because OP wants you to fill that in yourself, so that you might explain your assumptions or the market potential that you see, which might be wildly different from his (i.e. software having little to no moat)
In my experience (enterprise software), customers buy our products not because we have a moat or some hard-to-achieve technical advantage but because they can speak to us in their words, they know we care, and we try solve their problems quickly.
Just yesterday I was speaking with the COO of a $200M/yr revenue company in the supply chain space. He'd learned Claude Code and built a couple apps to solve internal problems but reached out to talk to us. I asked him "you've been able to build some really impressive tools, clearly you can solve your own problems, why are you talking to me?" And he said "I have a business to run. I shouldn't be coding. I need somebody who understands my business & can solve my problems without taking a lot of my time."
Is there a cheaper way for him to solve his problems? Absolutely. But he wants to put the key in the ignition and know the car will turn on every time without thinking about it. There is an endless list of problems to solve; I don't think software businesses are going anywhere anytime soon.
This should be the top comment. The thing about growth of businesses overall, is that they want outsourced capacity (that’s what employees or contractors are) and that dynamic doesn’t go away because of AI, because like the comment mentioned, it’s not reliable enough in the sense that it can accept high-context vague instructions and ‘figure it out’ like an enterprise developer can.
I even dream of build tools for business to make apps (like Air table, but better) and even if you can do anything that do, perfectly, the software they need not means they want to babysit it all the time.
Is like the person that knows how cook, amazingly, yet hire a chef for take care of it most days.
Thought this would be a thread about the crazy offers being handed out to join AI teams at Amazon, Meta, Google, OpenAI, Anthropic, Apple, or any of the massively capitalized 'neolabs'.
I'd argue the question was wrong, it's not that big companies can copy you easier now. They could have always invaded your space and destroyed your business. As other pointed out it was always picking up the pennies that they didn't want until those pennies became dollars.
The concern now is that other small team or solo developers can rebuild what you have very quickly. This happened in the mobile space with all the decompiled and repacked (with min changes) apps that showed up in the stores.
The moat for SaaS startups was that the code is hidden. Now that matters less because people use AI to try and reverse engineer your backend from the API or even UI screenshots.
You have to pick up the pace to keep ahead of them and make sure you don't cause problems for customers while doing it.
The value cannot be just the software. E.g. some workflow tool (Salesforce). These tools will continue to exist for awhile but any customer capable of moving off of it to a startup version, can probably make their own startup version, tailored to them.
Now, if you offer something besides the software — logistics, networks, financial instruments, regulatory compliance, physical goods, compute, etc — that has value besides the software.
But the five billionth workflow automation tool has fast diminishing value in 2026.
The fact that people look to start a business based on searching foe a moat shows they don't believe in free markets. As well as shows what's wrong with Silicon Valley.
This is the problem with big concentration of wealth and power. The big tech mega corps can copy your idea easily because they don’t have any budget, they can undercut you or sell at a loss, and they can distribute it to all their current customers with anti competitive bundling.
It has happened over and over many times and American antitrust law is useless. The largest corporations must be broken up, taxed heavily, and regulated in new ways. Otherwise there is no fair competition or level playing field for startups.
in the valley at least its difficult to pursue that unless you’re in a “hot” field. A few years ago, it was cloud, then big data, then crypto and now AI. When startups in those fields can raise hundreds of millions, they can lure away a lot of talent (both tech and non tech).
Nah. Regardless of where the company is nominally headquartered there are always an effectively infinite number of employees who can be hired to work remotely or out of satellite offices.
I would strongly recommend staying away from software startups unless:
- The CEO of some major corporation or a big VC is a close friend or friend of your family.
- You are rich and have a lot of friends who will buy your product.
- You already finished the MVP; which you started building 12 years ago... Might as well try to complete.
- You're a criminal.
The market is insanely saturated and people already have more stuff than they need. Capitalism has been over since 2008. Now it's just feudalism. Product is irrelevant; it's all a social game of selection. You have to be selected. You just need to know someone and have a product with a semi-reasonable narrative that your CEO buddy can use as a justification to give you company money. That's it.
Depends on your goal - do you have an idea you care about and want to solve? Probably a good idea. If you "want to be your own boss" or looking for something just to be acquired, hard to say, depends on who you know, etc.
You're gonna get a lot of positive responses here, but frankly only do it if you think you can make meaningful money within a month or two.
Everything is going off the rails this year. You only have to use Claude Code for 10 minutes to realize every job involving a computer is going to get flipped upside down within a year.
Lol that's what they told us last year. And they'll say the same thing next year. It's obviously useful for certain tasks but the number of errors and hallucinations are still quite bad for anything large or complex or really novel. That part is improving very slowly and some fundamental theoretical breakthroughs will be needed.
Have you actually had it do anything substantial and then tried to work with the code it produces afterwards? It may "work" but it's a horrific mess. Good luck bug fixing that.
Yes, with GPT 5.2 Codex and 5.2 Pro specifically. It’s not a mess because of the context I provide and the guidance and reattempts I apply. It’s working great, the resulting code is good when I accept it, and I’m getting much more done than in the before times.
I am just as bullish as you on the potential. AI is going to change the world all right. Much bigger than the internet.
I an far, far less bullish than you on the timeframe. The vast amount of work is not even optimised for computers without AI. Much if not most bureaucratic process has stayed mostly the same for the best part of a hundred years.
It will change everything, but not in a single year!
+1. Claude is actually really good at all kinds of development but Claude will still make plenty of mistakes and occasionally go so far in the wrong direction that it still needs someone with experience to steer it.
You mean the big companies who still haven't moved away from abominations like SAP and Oracle? The ones where you require twenty approvals to get a small pilot done? Instead of moving to saner and cheaper alternatives, they would just say, "hey, why don't we just start making our own software?" Every effort like this—if it had any takers—will fail spectacularly.
I get it people are skeptical about the future. But I can't imagine any scenario where people would like taking responsibility of building and mantaining their own software for everything vs. paying marginal amount of money (relatively speaking) to let someone else take the headache.
I can imagine a future where it will be possible for a family to host their own essential services ... There got to be something between homelabs and cloud services bc the gap is too big.
> I can imagine a future where it will be possible for a family to host their own essential services
Exactly. Even something as seemingly mundane as hosting your own email is a major challenge.
Good luck. To have something that a regular family could use would require remote access from the company for troubleshooting, updates, maintenance.
So you get all of the downsides of cloud hosting (company employees can still remote in), with none of the upsides (all the hardware is now geographically distributed, instead of one big building) with the privilege of paying for it instead of being "free" like facebook/google.
Yes! All startups are created to solve a problem, regardless of the tools used. Apps are simply tools to solve human problems. Because humans will always have challenges to address, software will remain a vital tool. While AI makes writing software much easier. It's likely to lead to an explosion of new apps. Only those that fill a genuine need will survive. Your job is to identify these new problems and determine which apps to build.
Simple apps are a thing of the past. If an LLM can generate an app in a few sittings, it isn't a saleable product. However, people will still pay for a fully engineered application that solves a complex problem that AI cannot easily replicate.
Regarding copies, there is always room for more than one solution to the same need. Your challenge is to figure out how to stand out. A fundamental business hurdle, that has existed since the beginning.
Here's an idea that always bear's fruit. We humans love to do things as easy as possible. Write something that saves energy, time and is simple then people will pay for it.
Plus, how many of these existing apps were just databases wired up in different ways?
This is why I like using mathematical or algorithmic approaches to solve difficult problems. Writing programs that use statistics, mathematics, optimization, analytical geometry, etc guarantee a certain level of security from the swarms of CRUD merchants flooding the market.
And how many of these apps were just files wired up in different ways?
Maybe. great businesses don't need moats. They just need sonething people buy from them. Maybe venture capital needs moats - but you can get rich without that. (If rich is even the goal - a nice life is a better goal)
beware of any business where there is no competition - there is generally good reason nobody else is making money there.
You could probably become rich wholesaling gravel in your city. There are plenty of opportunities all around. Execution is key.
It is. Big companies (or really anyone) usually don't have the time to copy an idea unless it becomes too big already. And if your idea becomes too big, it was worth pursuing it.
Or worth buying up. Which in many cases was the "purpose" of doing the startup in the first place.
Sure, we'd all like to think that the goal was an idealistic "startup does things for bettering humankind".
But let's face it: A large amount of startups are literally founded as an "easier" alternative of building a "more agile" sub-organization within an established and more process driven org and then just get bought out by some of those larger orgs.
Whether or not those large orgs are then actually successful in integration and actually properly leveraging what they bought vs. just "crushing competition", is not necessarily the concern of the founders, depending on how ruthless vs. idealistic they are.
You're asking what's a defensible value-add, but without really framing current business conditions or issues.
Time - opportunity - matters a lot, perhaps more than anything. And to face that, one needs to ask better questions (even if you're just polling).
"Current business conditions or issues" -- I think that's because OP wants you to fill that in yourself, so that you might explain your assumptions or the market potential that you see, which might be wildly different from his (i.e. software having little to no moat)
In my experience (enterprise software), customers buy our products not because we have a moat or some hard-to-achieve technical advantage but because they can speak to us in their words, they know we care, and we try solve their problems quickly.
Just yesterday I was speaking with the COO of a $200M/yr revenue company in the supply chain space. He'd learned Claude Code and built a couple apps to solve internal problems but reached out to talk to us. I asked him "you've been able to build some really impressive tools, clearly you can solve your own problems, why are you talking to me?" And he said "I have a business to run. I shouldn't be coding. I need somebody who understands my business & can solve my problems without taking a lot of my time."
Is there a cheaper way for him to solve his problems? Absolutely. But he wants to put the key in the ignition and know the car will turn on every time without thinking about it. There is an endless list of problems to solve; I don't think software businesses are going anywhere anytime soon.
This should be the top comment. The thing about growth of businesses overall, is that they want outsourced capacity (that’s what employees or contractors are) and that dynamic doesn’t go away because of AI, because like the comment mentioned, it’s not reliable enough in the sense that it can accept high-context vague instructions and ‘figure it out’ like an enterprise developer can.
Yeah, this is how we survive.
I even dream of build tools for business to make apps (like Air table, but better) and even if you can do anything that do, perfectly, the software they need not means they want to babysit it all the time.
Is like the person that knows how cook, amazingly, yet hire a chef for take care of it most days.
One of the better, more levelheaded responses here.
A PM I've worked with many times always used to say, "They want an easy button! It's that simple!."
So long as it's not about AI. The world hasn't run out of problems that could be solved or improved by software.
Thought this would be a thread about the crazy offers being handed out to join AI teams at Amazon, Meta, Google, OpenAI, Anthropic, Apple, or any of the massively capitalized 'neolabs'.
Do it if you want to - if you feel some burning desire to create that thing and you just can't get it out of your head.
Build something novel, what has changed?
I'd argue the question was wrong, it's not that big companies can copy you easier now. They could have always invaded your space and destroyed your business. As other pointed out it was always picking up the pennies that they didn't want until those pennies became dollars.
The concern now is that other small team or solo developers can rebuild what you have very quickly. This happened in the mobile space with all the decompiled and repacked (with min changes) apps that showed up in the stores.
The moat for SaaS startups was that the code is hidden. Now that matters less because people use AI to try and reverse engineer your backend from the API or even UI screenshots.
You have to pick up the pace to keep ahead of them and make sure you don't cause problems for customers while doing it.
The serious answer:
The value cannot be just the software. E.g. some workflow tool (Salesforce). These tools will continue to exist for awhile but any customer capable of moving off of it to a startup version, can probably make their own startup version, tailored to them.
Now, if you offer something besides the software — logistics, networks, financial instruments, regulatory compliance, physical goods, compute, etc — that has value besides the software.
But the five billionth workflow automation tool has fast diminishing value in 2026.
The fact that people look to start a business based on searching foe a moat shows they don't believe in free markets. As well as shows what's wrong with Silicon Valley.
Yeah, and a moat can just be a solid trusted brand. Claude Code can't take that away.
This is the problem with big concentration of wealth and power. The big tech mega corps can copy your idea easily because they don’t have any budget, they can undercut you or sell at a loss, and they can distribute it to all their current customers with anti competitive bundling.
It has happened over and over many times and American antitrust law is useless. The largest corporations must be broken up, taxed heavily, and regulated in new ways. Otherwise there is no fair competition or level playing field for startups.
in the valley at least its difficult to pursue that unless you’re in a “hot” field. A few years ago, it was cloud, then big data, then crypto and now AI. When startups in those fields can raise hundreds of millions, they can lure away a lot of talent (both tech and non tech).
Nah. Regardless of where the company is nominally headquartered there are always an effectively infinite number of employees who can be hired to work remotely or out of satellite offices.
You can get the same output as $500k/year of software engineers for $2.4k/year now. Never been better if you ask me!
Isn't it the opposite? E.g. there is very little moat left and small companies or individuals can copy any product big or small in no time?
I would strongly recommend staying away from software startups unless:
- The CEO of some major corporation or a big VC is a close friend or friend of your family.
- You are rich and have a lot of friends who will buy your product.
- You already finished the MVP; which you started building 12 years ago... Might as well try to complete.
- You're a criminal.
The market is insanely saturated and people already have more stuff than they need. Capitalism has been over since 2008. Now it's just feudalism. Product is irrelevant; it's all a social game of selection. You have to be selected. You just need to know someone and have a product with a semi-reasonable narrative that your CEO buddy can use as a justification to give you company money. That's it.
Depends on your goal - do you have an idea you care about and want to solve? Probably a good idea. If you "want to be your own boss" or looking for something just to be acquired, hard to say, depends on who you know, etc.
There's still plenty of moats frankly, same moats as before. What isn't the moat is the software development time.
In our case, we're building a tool that has a moat from: integrations, multiple parties connecting, and others
It's very sticky once we get in, and has nothing to do with the software so much as legal, company policy and inter party communication
You're gonna get a lot of positive responses here, but frankly only do it if you think you can make meaningful money within a month or two.
Everything is going off the rails this year. You only have to use Claude Code for 10 minutes to realize every job involving a computer is going to get flipped upside down within a year.
Lol that's what they told us last year. And they'll say the same thing next year. It's obviously useful for certain tasks but the number of errors and hallucinations are still quite bad for anything large or complex or really novel. That part is improving very slowly and some fundamental theoretical breakthroughs will be needed.
I don't care what they told you last year, I didn't say jack shit. I'm saying it now.
Cope or pretend it's not happening, I don't care, this is the year.
Have you actually had it do anything substantial and then tried to work with the code it produces afterwards? It may "work" but it's a horrific mess. Good luck bug fixing that.
Yes, Opus 4.5 is not business as normal. If you haven't tried it, you really need to, to update your opinion.
Yes, with GPT 5.2 Codex and 5.2 Pro specifically. It’s not a mess because of the context I provide and the guidance and reattempts I apply. It’s working great, the resulting code is good when I accept it, and I’m getting much more done than in the before times.
I am just as bullish as you on the potential. AI is going to change the world all right. Much bigger than the internet.
I an far, far less bullish than you on the timeframe. The vast amount of work is not even optimised for computers without AI. Much if not most bureaucratic process has stayed mostly the same for the best part of a hundred years.
It will change everything, but not in a single year!
Claude Code is useless for anything that requires advanced knowledge.
+1. Claude is actually really good at all kinds of development but Claude will still make plenty of mistakes and occasionally go so far in the wrong direction that it still needs someone with experience to steer it.