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What Claude Code Means for SaaS
Earlier this year, Open AI released its latest version of Claude Code (Claude Opus 4.5), which is a marked improvement over other AI coding agents and represents a true breakthrough in the sector. Claude Opus 4.5, and its non-coder-friendly app Claude Cowork, have unleashed a paradigm shift in coding, rendering some skills and business models virtually obsolete. Within days of the Cowork plugin going live, software stocks collectively lost over $300 billion in market cap.2 Software stocks have already lost more than 30% of their value over the past three months.2 Some are even calling the arrival of Claude Code the SaaS-pocalypse.
Until 2025, AI-powered coding functioned more or less like autofill for coders. But last year, AI coding evolved into an agentic form that paved the way for “vibecoding” to be brought to the mainstream. Instead of learning or using a coding language and writing code line by line, “vibecoding” involves describing the desired features in plain English and letting the AI coding agent run with it. AI coding agents like Claude Code can now make custom CRMs like a Monday.com board in 2% of the time at 2% of the cost.2 It can build a custom, functional website in under two minutes.3 And users don’t need to know how to code in order to use it. AI coding agents are disrupting the SaaS industry with their ability to create workflows in house, complete the work of several people, and create new features as needs arise.2
In a test of just how efficient Claude Code could be, developers found that in just two weeks and for only $20,000, 16 AI coding agents were able to produce the same amount of work that would have taken a team of human coders a year and cost over $1 million to produce.2 The SaaS model starts to break when customers can point to an agentic AI workflow that requires fewer people, hours, and money.2 SaaS companies charging high prices to support their massive staff of highly-skilled senior engineers become less attractive. The replacement has already begun; employment for young software engineers has dropped 20% from its peak in 2022.3
The types of SaaS work most at risk of being replaced by Claude Code are essentially those that require lots of humans clicking on lots of workflows. Think CRMs, project management, marketing, and sales. But while SaaS might end up being the loser in this fight, there are many other AI-related industries that will thrive, such as semiconductors, AI infrastructure, and other AI enabling technologies. AI coding agents will only increase their demand.
The philosophy behind TrueShares Technology, Deep Learning, and AI ETF (LRNZ) has been to focus on the AI enablers and sophisticated users that we consider “category killers.” That includes semiconductor companies like Nvidia, AMD, and Broadcom; data storage and management companies like DataDog and MongoDB; AI-focused cybersecurity companies like Cloudflare and Crowdstrike; and sophisticated users in the healthcare and biotech space like Eli Lilly and Structure Therapeutics.
The tech industry hasn’t produced something this disruptive or revolutionary since the release of ChatGPT. But what Claude Code does is take AI from being a fancy search engine to fundamentally changing how people work and who (or what) is doing that work. It is a proof of concept that AI can provide real value to the economy. Companies and investors have sunk billions into the big bet on AI to the point where many feared we were in a bubble about to burst. By adding real economic value, Claude Code quiets that fear.
For more information and a full list of holdings, visit: https://www.true-shares.com/etf/lrnz
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