Here's the uncomfortable truth for agencies like ours: when your billing model is built on hours worked, and your teams suddenly need half the time to deliver the same value, you're facing an existential challenge. The very foundation of how we price and deliver work needs rethinking.
The Productivity Paradox We Can't Ignore
Our developers are using agentic AI and are shipping production code at twice the speed – and are getting faster. The cost differential is stark. In the past month, we’ve been able to deliver working code within the first day, and ship in under a week products that would’ve taken 4-6 weeks to build earlier this year.
The nature of what clients need from us has fundamentally shifted. They don't need a team of developers writing boilerplate code anymore. AI handles that. What they need are senior solution architects who understand how to orchestrate AI agents, build robust agentic DevOps pipelines, and architect headless AI-first systems.
The most valuable engineers today know when not to write code at all, can design AI-powered workflows that integrate seamlessly with existing systems, and understands the business outcomes deeply enough to guide AI toward the right solutions.
The Death of One-Size-Fits-All SaaS
Perhaps the most interesting shift I'm seeing is how AI is democratizing custom software development. For years, companies have been forced into bloated SaaS products with vendor lock-in designed for the masses, paying for features they don't need, working around workflows that don't quite fit, accumulating technical debt from integration complexity. (I’m looking at you, Salesforce.)
Here's what SaaS vendors don't want you to realize: when AI can build a CRM interface in a day, their moat disappears. Your customer data is the asset, not their application. Why pay to access your own data through their interface when you can build exactly the interface you need, directly connected to your database?
With agentic development, we can now build bespoke micro-SaaS solutions tailored precisely to a company's needs in the time it takes to evaluate and implement an off-the-shelf solution. These aren't simplified versions of existing products; they're purpose-built tools that do exactly what's needed, nothing more, nothing less.
A client recently asked us to integrate three different SaaS products they were using. Instead, we built them a single micro-SaaS solution that replaced all three, cost less to maintain, and actually matched their workflow. Six months ago, this would have been unfeasible and economically unviable. Today, bespoke composable platforms often cost less to build and maintain than enterprise SaaS licensing.
We call these rapidly replaceable experiences. When the marginal cost of software approaches zero and build time drops to days or weeks, what matters isn't how fast you build, but your ability to deploy and replace experiences as business needs evolve. Your scrum sprint of 1-3 weeks is becoming your entire project sprint from concept to deployment.
The New Value Equation
The agencies that survive this transition won't be the ones with the most developers or the lowest hourly rates. They'll be the ones who understand that the value equation has fundamentally changed. Speed to market has collapsed from months to weeks. Development costs have shifted from linear (more features = more developers = more cost) to strategic (right architecture = AI leverage = exponential output). The senior architects guiding these systems can focus on what matters: business logic, system design, and user experience.
Quality, paradoxically, has improved, but the very definition of quality is changing. It's no longer about configuration options or compatibility with monopolized ecosystems. When we look at the holistic value per dollar invested, such as revenue impact, cost and time to implement, employee experience, customer experience, cost of ownership, opportunity cost for other initiatives, and adaptability to changing business needs, we see a remarkable shift.
SaaS stability was always a lie – a stuck system that costs extravagant amounts to marginally adjust isn't stable, it's paralyzed. True quality now means rapidly deployable, precisely fitted solutions that can evolve as quickly as your business does.
What This Means for the Industry
We're entering an era where the traditional agency model (large teams, long projects, time-based billing) simply doesn't make sense. The future belongs to small teams of senior architects and AI orchestrators who can deliver what used to require dozens of developers.
This isn't the first time we've seen this pattern. Henry Ford replaced master craftsmen with assembly lines designed by systems engineers. The value shifted from manual craft to system design. AI is doing the same to our industry, replacing line-by-line coders with AI agents, while the real value moves to the architects who design the systems and orchestrate the outcomes. We're entering what Sam Altman recently called 'the fast fashion era of SaaS' – custom software spun up quickly, cheaply, and precisely to fit.
For clients, this is liberating. They can finally build the exact tools they need without the compromises of packaged software or the costs of traditional custom development. For agencies, it's a wake-up call. Our value isn't in how many hours we can bill, but in how effectively we can leverage AI to solve business problems.
The engineering agencies that thrive will be those that embrace this reality and restructure accordingly. The rest will find themselves competing in a market that no longer exists.