Topicus's prominent software examples look weak in the AI era, making Tyler Technologies' US government software preferable. Government software has staying power, but Tyler avoids the European exposure and currency risks. The durability of Topicus's software runway and its future valuation remain uncertain. x.com  x.com 

Little apps will be dirt cheap to build and run, arguably already are, making SaaS vendors easier to replace. The existential threat is greater than six months ago, and from a technical perspective the SaaS bear case is running ahead of schedule. Vendors that adapt have a massive opportunity, and some companies may be safe. x.com  x.com  x.com 

Tyler Technologies trades at 34x GAAP EBIT, not inexpensive for roughly 10% aggregate growth, and AI is unlikely to change its story in the next few years. Its view of AI is the most muted of any public SaaS company, perhaps rightly given slow government buyers and its ongoing cloud transition; management calls AI a tailwind, not a big one. Long run, AI could make copying its software cheaper and pressure pricing, while cautious local governments and brutal go-to-market give it time to respond. … Show more

AI has erased engineering complexity as a SaaS moat, so software survives only with compliance or data lock-in. Tyler Technologies, Veeva and Guidewire are anchored in government, pharma and insurance rules, where leaving means a compliance audit; Veeva's revenue rose 16% while its stock fell 25%. Palantir's ontology locks in customer data. Salesforce, Workday, Adobe and ServiceNow are seat-based with neither moat, and BlackLine and nCino, though regulated, never went AI-native. x.com 

Constellation Software has no way to benefit from AI and little organic growth, so 21x GAAP EBIT looks fair, with perhaps a downside skew if churn rises across its portfolio in the next five years. The market's negative reaction is rational. Its small vertical software businesses were run financially rather than for product, many still on-prem, with no central AI strategy as software gets cheaper to build. Organic growth was 2% in constant currency; inorganic growth is fundamentally different. … Show more

The 'SaaSpocalypse' narrative is wrong because AI makes replacing enterprise software more expensive, not cheaper, leaving beaten-down SaaS stocks at once-in-a-lifetime entry levels. Replicating ServiceNow would take some 40,000 engineers to match 20 years of code, and even AI coding would raise costs, since tokens are not free and model labs lack the capacity to be enterprises' database layer. LLMs are pattern recognizers that can fail catastrophically on new problems. x.com  x.com 

Constellation Software and Topicus are being wrongly lumped in with AI software fears, setting them up to rerate back toward a 3% free cash flow yield once things clear. They adapt, execute and take advantage of deals, with record capital deployments, and moats in vertical market software are shifting rather than disappearing; much of software can adapt with the right culture. A post the author replies to counters that new competitors have beaten Harris and Tyler in govtech. x.com  x.com  x.com 

Software incumbents like monday.com and CrowdStrike should hold their ground because companies will lean on existing software to integrate AI rather than rip it out. Token shortages make AI hardly usable without top-dollar spend, so firms with no business vibe-coding will use software they already pay for, which can scale to get cheaper tokens. No CEO will risk their job, and no CTO will ask the board to scrap a costly software investment. The market won't go much higher without software. x.com  … Show more