Reid Hoffman and Aaron Levie on What AI Agents Mean for SaaS

"Almost all of the mistakes presume that there's fixed demand." That's Reid Hoffman, in a conversation with Aaron Levie, co-founder and CEO of Box, about whether AI agents will shrink professional services firms or create more demand for them. The question comes down to something neither of them takes for granted: if agents make it easier to do the work, does the amount of work stay the same?

In thisconversation moderated by Ben Casnocha, Hoffman and Levie discuss what agents could mean for SaaS, professional services, B2B sales, and the businesses that may emerge around work that has never been software-based.

Key Insights

Agents don't uniformly help or hurt SaaS

How agents affect a software business depends on what was limiting the software in the first place. Levie's example is headcount. Some software categories are limited because only so many people at a company can use the product. If agents can do the work instead, that ceiling goes away.

"The total spend on all software ever in the contract space is a couple billion dollars a year. Well, now in a world of agents, the value of that category could be tens of billions of dollars," he said.

But that's not true everywhere. Some software categories are already saturated, with features that people barely use. Agents could make those products cheaper or reduce the amount of software companies need.

The business model may matter more than the technology

Hoffman uses cloud computing to explain why new technology doesn't always destroy established companies. Many people expected the cloud to wipe out enterprise software incumbents, but companies like SAP adapted instead.

"SAP is a $300 billion company today," he said. Moving to the cloud didn't necessarily threaten the core business. In many cases, incumbents could adopt the new technology and grow with it.

Customer support software looks different. Levie points to companies whose businesses depend on charging for seats. An agent-based product doesn't need the same number of human users, which creates a problem for incumbents whose revenue depends on those seats.

The bigger opportunity may be work that was never software

"It's not going to look like just do the old software product but with agents," Hoffman said.

He points to Uber and Airbnb as examples of companies that didn't simply improve existing software categories. They built software around activities that hadn't been digitized in the same way before.

Agents could do something similar with professional services. Legal work, audits, and other services-heavy businesses have traditionally depended on human judgment and haven't fit neatly into software. Agents could make some of those businesses much more software-driven.

B2B sales will stay human longer than many technologists expect

Levie doesn't see agents replacing the person responsible for a business decision anytime soon.

"My agent is not going to talk to your agent to do a deal... I have to look at somebody and say your job is on the line for this thing to be delivered. That's going to be humans," he said.

Hoffman sees it as a question of trust. In business, people want to know who is responsible when something goes wrong and who has something at stake.

"It's certainly true for longer than most technologists think," he said, "precisely because business is built on trust."

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About the Guests

Aaron Levie is co-founder and CEO of Box, which he started in 2005 with Dylan Smith while at the University of Southern California. He took Box public in 2015.

Reid Hoffman was the co-founder of LinkedIn and is chairman of Village Global. He is also the co-founder of Inflection AI and Manas AI.

About the Host

Ben Casnocha is a general partner at Village Global, an early-stage, network native venture capital fund. He is co-author of two New York Times bestsellers with Reid Hoffman, "The Alliance" and "The Start-Up of You," and writes regularly on entrepreneurship and venture investing.