Death of software companies 😬

20 Feb 2026 · 1 min

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1:21

In this commentary, the speaker examines recent sharp declines in the stock prices of several well‑known software firms—Workday, Intuit, Snowflake, among others—while the broader Nasdaq‑100 index continues to rise. He points to a Morgan Stanley Software Index that is falling sharply, suggesting a sector‑wide weakness. The core argument is that AI‑driven low‑code/no‑code platforms (e.g., Cloud Code) are democratizing software creation, allowing individuals and small teams to build custom solutions that were once the exclusive domain of large vendors. Consequently, software companies that rely on commoditized, easily replicated functionality are vulnerable. In contrast, firms that possess a “data moat”—large, proprietary datasets that power their products—such as Salesforce, HubSpot, and Slack, are positioned to thrive because their value is tied to unique, hard‑to‑copy data assets. The speaker concludes that traditional SaaS companies lacking a data moat or a differentiated application (dApp) will face increasing pressure, while those with strong data advantages will likely see long‑term growth. He ends with a call to follow for more AI, business, and software insights.

Chapters

So is this the death of software companies? So there is a chart recently that shows the stock prices of companies like Workday, of Intuit, of all these— Snowflake, for example. It shows all their stock prices dropping. We're talking, you know, 8%, 10%, 15%, 20% or so. It looks like the apocalypse. And there's another graph that shows the Nasdaq 100 going up, right? The top 100 companies in Nasdaq. And it shows the Morgan Stanley Software Index dropping like a fly. Now, here is the key thing. People are saying software is dying because a lot of these products, these AI products like Cloud Code, for example, allow you to build whatever products you want. A lot of people can build custom And that is the key thing. Software companies who can build custom solutions over time, they're always going to have a place. And also software companies that have a data moat, such as Salesforce, for example, or HubSpot, where you have all your data in there, or Slack, where you have all your interactions, those companies are going to become more valuable over time. The ones that have a data moat, but software where people are just doing rudimentary tasks and it's very easy to copy, those software companies are in trouble. And so what's happening right now in the world of software is that the bar is raising a lot higher. It's rising a lot higher because people like you and me can build whatever we want. So in summary, I would look at it this way. Traditional software companies that don't a dApp that don't have a data moat, those are the ones that are in trouble because of the advent of vibe coding. Now, the software companies that do, they're going to do a lot better. In fact, I see HubSpot, I see Salesforce thriving over the long term because they have this data moat. If you want more AI tips, business tips, software tips like this, just hit follow.