No qualifying author-owned investment thesis was confirmed in this post.
Actionable sector-level thesis with causal mechanism, though no specific ticker identified.
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My thinking is that AI will do for commercial software development what game engines did for game development.If small teams using AI-powered software tools can compete for market share against established developers, we may see a flood of cheaper (and possibly well-built) programs hitting the market, leading to intense competition.
Why buy from established companies when there are several smaller firms offering similar software at lower license fees?
The cost of tailored software for businesses can be eye watering, and the deciding factors often come down to price and time how quickly a working system can be built.
AI could also drive more in-house development if companies realize they can hire a small team to build and manage custom solutions themselves, rather than renting software from vendors.
These are just my thoughts, but my overall thesis is that software could become much like the app market an oversaturated space with hundreds of products offering similar experiences.
While I don’t think this shift will happen overnight, some of the recent repricing of software companies may already reflect early adjustments to this potential future.
Overall I just think we should be more diligent when looking for value investment in the software market.