Memo #2

CRM: SaaS is Not Dead, Especially in the World of AI Agents

The Tape - SaaS, AI, and the Compression of the Application Layer
A few things have shown up repeatedly over the last few months:

Public SaaS multiples have already reset ~40-50% from peak, despite broadly stable fundamentals
Revenue growth across public SaaS has normalized into the mid-to-high teens, down from the 30-40% era
Net dollar retention has compressed into the 110-112% range, signaling stickiness but less auto-expansion
Seat-based growth is under structural pressure as AI agents replace human labor
Thin, UI-heavy workflow SaaS is being actively commoditized
The application layer is compressing quickly, while the orchestration layer is expanding slowly
The market is increasingly skeptical of systems of record as agents threaten to bypass traditional interfaces

In short: SaaS is not dying, but where value accrues inside the stack is changing

The Investment
Public Equity
CRM - Salesforce

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