Enterprise customers are frustrated with SaaS vendors pushing AI tools that take longer and cost more than promised, while vendors simultaneously change pricing, redefine usage metrics, and make cancellations harder to hit retention targets. The gap between what investors want and what customers need is widening.
Charles, do you feel like enterprise customers have become tired or more critical or perhaps both, about the emergence of shiny new AI tools come to replace legacy stuff?
Everyone I know who works on AI transformation tells me it's really hard and that it takes longer and the results you get from ROI are not nearly as immediate as management teams would like to see. So it's like every other technology project in the history of time.
Yeah.
Takes longer, doesn't give you what you wanted it as quickly as you thought, and it's more expensive than you think. I think what you are seeing, though, is as things like net revenue retention and gross revenue retention and churn. I think we sort of were getting to a place where to some extent, SaaS vendors might have done this to themselves, making it hard to cancel, changing pricing plans, all in an effort to extract more money from customers. I think created a fair amount of resentment and frustration on the part of customers that, like, these are all very tricky dark arts. You didn't just tell me, hey, we're taking you from 12 bucks. I'll never forget when our slack bill went up. I was like, wait, what happened? And they changed the window over which they measure an active user. And I'm like, well, it's your right to change that. But this feels hostile to me and makes me think this vendor doesn't have my best interests at heart. So I do think in an effort ironically driven by a lot of the SaaS metrics that investors are public and private are obsessed with, I think there's some software vendors who might have gone too far.
Yeah.
And so it's natural that customers are responding to that by thinking about alternatives.
