AI Fuels Software Budget Growth
PLUS: Former Glean founder building something new
Behind The Scenes
For decades, software gradually made its way into company budgets. Now, AI is set to reshape them entirely—and at a pace no one anticipates.
Since the Industrial Revolution, productivity gains have shifted costs from labor to technology. The spinning jenny replaced weavers. ERP systems replaced clerks. But no transition will redefine costs as profoundly as AI. While previous shifts automated predictable tasks, this one will automate judgment itself.
Even after nearly doubling in eight years, software still represents only a fraction of most companies' payroll. That’s about to change. As AI takes over routine cognitive work, spending will shift dramatically from labor to software. AI won’t just handle tasks—it will make decisions.
OpenAI’s 10x price increase is a sign of what’s ahead. New AI-native software companies are reaching $20M in revenue within three months. Some businesses have reduced customer service teams by 70% using AI agents. And with Microsoft investing $80B in AI infrastructure, big tech is making its bet clear.
(This article was written by Nikunj Kothari from balancing art. For full version of this article, you can read them here)
Geeks of the Week
Startup Name: Bespoke Labs
Geography: US
One-liner: AI tools for data curation and post-training LLMs.
Founder(s) Background: Professor (ML/AI) at UT Austin, Staff Software Engineer at Google DeepMind.
Startup Name: A79
Geography: US
One-liner: Enterprise agent platform for building and deploying, high ROI complex AI Agent workflows within weeks.
Founder(s) Background: Principal Engineer at Rubrik (employee #20), Principal Engineer at Roblox.
Founder(s) building in stealth
Director of Engineering at Google, Head of Engineering at Airbnb (via acquisition).
Senior Staff Software Engineer at Google / Engineering Lead at Gemini.
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