AI & Purpose Versus Task

SaaS stocks have dropped sharply over the past few weeks following several doomsday articles predicting that AI will replace them in the enterprise. The idea is that, today, people use SaaS products to complete tasks, but soon AI agents could handle those tasks, reducing the need for SaaS software and interfaces and leading to significant headcount cuts.

There's no doubt that this narrative has caught a lot of people's attention and that certainly was part of the sell-off, but if you looked at the valuations of the large SaaS companies a couple of months ago, most people would've thought they were out of whack. Many of these companies are quite mature and beginning to enter a slow/post-growth stage, which doesn't justify the large multiples they had a few years ago. So I think what's happening is more of a correction, with growth investors moving money to less mature, higher-growth companies, particularly AI-focused companies. 

I do think we’ll see some headcount reductions from the more mature SaaS companies in the coming months, though that’s more likely due to years of heavy stock-based compensation inflating share counts and depressing earnings per share as growth slows, driving valuation pressure. Though I imagine the headlines will be less about valuation and a cost structure reset and more about "AI is taking jobs!". 

Putting that aside, many people who believe that AI agents will take lots and lots of jobs (as opposed to making current staff more productive) think of a job as a series of tasks rather than a series of outcomes. Take an SDR (Sales Development Representative) who is focused on generating top-of-funnel sales activity. AI agents will no doubt take on many of the tasks of these workers, such as automatically scoring leads, researching prospects, or sending emails to prospects. No question. But that's not why companies hire SDRs. They hire SDRs to generate high-quality meetings with prospects. And that's really difficult to do. So AI agents will take on many of the tasks SDRs do, making SDRs more efficient, but not necessarily taking on the entire outcome of the job. 

Jensen Huang made this same point recently on the No-Priors podcast, calling it "purpose versus task." 

“We use Cursor pervasively here. Every engineer uses it — and the number of people we’re hiring today is just incredible. This is now the purpose and the task. The purpose of a software engineer is to solve known problems and to find new problems to solve. Coding is one of the tasks. And so if the purpose is not coding — if your purpose literally is coding, somebody tells you what to do, you code it — all right, maybe you’re going to get replaced by the AI. But most of our software engineers — all of our software — their goal is to solve problems. And it turns out we have so many problems in the company, and we have so many undiscovered problems. And so the more time they have to go explore undiscovered problems, the better off we are as a company. Nothing would give me more joy than if none of them are coding at all — they’re just solving problems. You see what I’m saying? And so I think this framework of purpose versus task is really good for everybody to apply."

I think this is a very important framing for leaders thinking about how to leverage AI to amplify and transform work inside their companies.

And it applies neatly to the job of the SDR. Ideally, they're not sending any emails at all. That's just a task. Instead, you want them focused on the high-value purpose of solving the problem of generating high-quality meetings with the right people.

Let me know if you know of a high-growth company that doesn't have that problem. I'd love to invest!