Is SaaS past its peak now that AI is everywhere, or are we just entering a harder, smarter phase where only the disciplined survive?

In a recent conversation with Rob Walling, founder of TinySeed and MicroConf, and host of Startups for the Rest of Us, we walked through that question from every angle. What we took away is both sobering and hopeful, especially for agency owners, freelancers, and product builders who want recurring revenue from software or services.

The short version: SaaS is not dead. The easy SaaS is dead.

AI is raising the bar, not removing the opportunity.

Meet Rob Walling: The “Outsider” Who Became a Bootstrapped SaaS Authority

Rob grew up in the East Bay in California, within driving distance of Sunnyvale and San Jose, yet felt cut off from tech. His family worked in construction, not startups. No VCs, no founders, no insider network.

Today, he is widely known as:

• Co‑founder of TinySeed, a remote accelerator and fund for B2B SaaS founders
• Co‑founder of MicroConf, a conference and community for bootstrapped and mostly bootstrapped founders
• Creator and long-time host of Startups for the Rest of Us, one of the longest-running startup podcasts, which you can find at the Startups for the Rest of Us website
• Author of multiple books, including The SaaS Playbook, which lays out a practical path to building a multi‑million dollar SaaS company without traditional funding. You can learn more at The SaaS Playbook site

You can also see a concise profile of his journey on the MicroConf speaker page for Rob Walling or the TinySeed about page.

Rob has:

• Started 6 companies
• Bootstrapped 5 of them
• Built several to millions in revenue
• Sold 2 for life‑changing outcomes
• Funded more than 200 SaaS companies through TinySeed, with each batch accepting roughly 2 to 2.5 percent of applicants

He still describes himself as an outsider to the classic Silicon Valley, VC-first mindset. That distance is exactly what makes his perspective so useful for those of us running agencies, building products on the side, or trying to move from services into SaaS.

From Ditches to SaaS Exits: Rob’s Unlikely Path

Rob did not start his career at a unicorn or Ivy League lab. His story looks much closer to what many of us in agencies or freelance work go through.

Early life: construction, D&D, and an Apple IIe

• Born in the East Bay in California, he grew up in a construction family.
• His father spent more than 40 years as an electrician and project manager.
• Rob and his brother learned BASIC as kids on an Apple IIe after their dad bought a computer, not because he was in tech, but because he thought, “this is the future and my kids should know how to use one.”
• Out in the country, they stayed occupied with books, Dungeons & Dragons, and typing text games from a programming book.

There was no tech network. No mentors. Just curiosity and a computer.

The “ditch moment” that changed everything

After studying electrical engineering, Rob worked in construction. One rainy day, sitting in a ditch with a shovel while a backhoe dug trenches for conduit, he looked at the people in the warm office nearby and thought:

“What am I doing here? I should be in there.”

That moment pushed him back to code.

• He went to the library nights and weekends and taught himself web programming.
• The era was classic ASP, Perl CGI, and early PHP. He quickly decided PHP felt far more sane than Perl CGI for web work.
• With only this self‑taught experience, he landed a job at a small consulting firm, Paradox Concepts, in Sacramento.

That firm built web applications for Bay Area dot‑com clients who wanted cheaper rates than Silicon Valley agencies. Rob learned fast by coding 40 to 50 hours a week.

Discovering bootstrapping and building his own path

Working for others soon lost its appeal. The venture-backed world felt closed off:

• He did not know any investors.
• Bay Area salaries at the time could not cover the high cost of living.
• The default answer of “just raise funding” did not match his reality.

He started asking a different question: “Can’t I just build software and charge people for it?”

Influenced by voices like Joel Spolsky of Fog Creek (which later birthed Trello and Stack Overflow), Rob began to:

• Build and launch his own small products
• Share his progress on a blog starting around 2005
• Attract an audience of developers who also felt outside the VC bubble

From there came:

• Books
• The podcast
• MicroConf
• TinySeed

Today he lives in Minneapolis, not San Francisco, and is still proof that you can build serious companies without being inside the usual hubs.

For those of us running WordPress agencies, eLearning studios, or consulting shops, that outsider‑to‑insider arc feels very familiar.

Is AI Killing SaaS, Or Making It Stronger?

With AI everywhere, it is natural to wonder if SaaS is about to be replaced by one‑off AI tools and custom agents.

Rob sits in a unique spot to answer that. TinySeed runs batches twice a year, funding 10 to 15 companies per batch from hundreds of applications. That gives him a wide view of what is actually working.

His answer is clear: SaaS is absolutely still working.

He sees:

• New SaaS companies started 6 to 24 months ago getting meaningful traction
• Founders building in very crowded markets and still breaking through
• AI helping them move faster, but not replacing the need for focus and execution

The key idea is this: AI is an accelerant, not a moat.

Everyone can use AI. That means it does not create a lasting advantage by itself. It only gives an edge if your competitors are slow to adopt it.

Where AI actually helps SaaS (and agencies)

Rob sees AI delivering real gains in three main areas:

• Product
  • Faster prototyping of features
  • Assists with code, unit tests, and refactors for experienced developers
  • Better internal tools around support and onboarding
• Operations
  • Automating busywork that used to require VAs or junior staff
  • Summarizing customer feedback
  • Drafting documentation and SOPs that humans then refine
• Growth and marketing
  • Assisting with first drafts of articles, emails, and ad copy
  • Repurposing content across formats
  • Researching prospects and markets faster

For agencies and freelancers, these same patterns apply. We can ship more, refine faster, and support more clients without bloating headcount.

AI will not give us a business model, though. It just makes it easier to execute the one we already have.

The limits of no-code and “vibe coding”

A big part of the discussion was how no-code tools and AI-generated code affect real businesses.

Rob’s view is nuanced:

• Tools like Bubble, Airtable, and similar platforms probably pulled 10 to 20 percent of what would otherwise have been paid SaaS into internal no-code builds.
• At TinySeed and MicroConf, they themselves run multiple internal apps in Airtable, including their entire application pipeline.

So no-code is real and useful.

Where it breaks down is when founders try to build full, multi‑million dollar SaaS products with:

• Patchwork no-code stacks
• AI-written “vibe code” they do not understand

TinySeed now explicitly asks applicants: who wrote your code?

Patterns they see:

• Products built mostly via AI or no-code almost always hit a wall.
• Any serious growth forces a complete rewrite in 6 to 12 months.
• During that rewrite, the company “stands still.” No new features, just re‑implementing what already exists.

The risks Rob highlighted:

1. Security flaws that AI does not catch and non‑developers cannot see
2. Unmaintainable code once you get past a simple utility
3. Broken economics, because low early MRR cannot fund a full rewrite later

Senior developers who use AI as a power tool, to speed up work they understand, are in a great position. Non‑technical founders who “vibe code” an entire SaaS product put themselves in a fragile spot.

For agency owners looking to spin up SaaS products as a side business, that warning matters. Using AI to help is smart. Relying on it to be your only developer is not.

The Biggest Mistakes Rob Sees Founders Making

After two decades of building and now investing in SaaS, Rob has a short list of mistakes that come up again and again.

Selling lifetime deals on true SaaS

Rob is strongly against lifetime deals for hosted SaaS.

If customers can download software and run it on their own server, a single upfront price makes sense. You are not carrying long‑term hosting and support costs.

For true SaaS, where you run the infrastructure, a lifetime deal means:

• You get a one‑time bump in cash
• You inherit an open‑ended support and hosting obligation
• You cram years of support into a small early payment

There are exceptions. In the show, Jonathan and Kurt mentioned Dustin, founder of Magi, who used a lifetime deal to get enough cash to move his product forward. Rob’s point is not that this never works, but that, as a habit, it is dangerous math.

If we run an agency and consider SaaS or subscription services, we need our pricing to line up with ongoing costs.

Chasing ideas instead of doing the boring work

Rob admits this was one of his own early mistakes.

• Launching “an idea a week” feels productive.
• It scratches the maker itch.
• It avoids the hard, slow grind of iterating on one product until it actually fits a market.

He compared this to buying lottery tickets.

With his email SaaS Drip, it took about 18 months and multiple iterations before things really clicked. The same pattern shows up over and over in the companies he backs.

The takeaway for us:

• If our tendency is to quit too soon, we probably need to stay with an idea longer than feels comfortable.
• If our tendency is to cling to something for 6 or 7 years with little traction, we need to be more willing to walk away.

Self-awareness matters here.

Agencies do this too. We keep changing service offerings instead of sticking with one and making it exceptional.

Hiding a leaky bucket behind great marketing

Rob shared the story of a strong marketer who grew a SaaS to a million in revenue but later realized it was a “leaky bucket.” They were losing customers as fast as they added them.

Key signs:

• High churn
• MRR graph that only grows because you pour new customers in constantly
• Growth that depends completely on the founder grinding top‑of‑funnel every month

Rob calls this “brute forcing” growth.

At TinySeed, they look at:

• Net revenue retention
• Churn over time
• Whether churn flattens out as customers age

They will not fund companies that grow fast on the front end but leak heavily on the back end.

This lesson maps directly to agencies and membership sites. We can sell hard today, but if clients or members quietly slip away every few months, we are just sprinting in place.

Rob’s 5 Stages of Product-Market Fit

Most product‑market fit frameworks come from VC land and assume huge rounds and hypergrowth. Rob adapted the idea for bootstrappers and calm-growth founders.

Here is his simplified view of the stages, tied to churn and revenue levels:

Stage	Typical Churn (Monthly)	Typical Revenue	What It Feels Like
1. Pre‑PMF	5–10% or higher	A few thousand MRR	Flailing, constant doubt, nothing clearly working
2. Weak PMF	3–7%	Roughly $5k–$20k MRR	Some customers stick, some value, but still fragile
3. Emerging PMF	Trending lower	Tens of thousands MRR	Patterns appear, feedback lines up, growth gets easier
4. Strong PMF	Low, often predictable	Around $1M ARR	Clear demand, word of mouth, marketing starts compounding
5. Mature PMF	0–3% net (possibly net negative)	$1M+ ARR	Expansion revenue offsets churn, very stable revenue base

To a big VC firm, many of these look like “toy” businesses. To a founder who sells a $3M ARR SaaS for tens of millions, it is not a toy at all.

For those of us building software as an add‑on to our agency, this scale is more than enough to change our lives.

The real value of this framework is diagnostic. We can ask:

• Where are we today?
• Are we acting like we are at Stage 4 when we are really at Stage 2?
• Are we obsessing over growth tactics when we still have a weak or emerging fit problem?

How Rob validates ideas before he builds

Rob is blunt that “validation” is never 100 percent. You cannot be sure something will work until real customers pay and stick with it.

What validation can do is move us from “almost no signal” to “some confidence this is worth a real shot.”

He leans on two main tools:

1. Landing pages with real intent

He has used simple landing pages for:

• His first book, Start Small, Stay Small
• The first MicroConf conference
• TinySeed itself

The pattern:

• Create a clear promise on the page
• Explain why you might be the right person to deliver it
• Ask for an email address from interested people

The original TinySeed page was just a description of “funding for bootstrappers,” some context on why it should exist, and a form for founders and potential investors. From that and his network, the first TinySeed fund of a little over $4M was raised.

2. One‑to‑one customer conversations

Rob also pointed to Jason Cohen’s story of how he validated WP Engine, described in detail in his post on vetting startup ideas.

Jason:

• Reached out directly to potential customers on LinkedIn
• Described a premium, high‑performance WordPress hosting offer
• Counted how many people told him they would pay for it

When he hit a solid number of “yes” answers, he committed.

Rob’s own pattern combines both methods:

• Use landing pages and content to collect early interest
• Talk to real prospects, ask what they use now, what they hate, and what they would pay for
• Look not only for enthusiasm, but also for willingness to pay, not just from friends

For agencies, this same approach works for new service lines or productized offers, not just software.

Why B2B SaaS Wins Over B2C (Most of the Time)

Rob has a very clear stance here: B2C SaaS is usually a rough road.

Here is why.

The B2C SaaS problem

Patterns Rob sees in consumer‑focused SaaS:

• Churn can hit 20–25 percent per month
  You lose your whole customer base every few months.
• Price points are low
  Consumers complain about $12 for Netflix. Asking $50–$100 per month is almost impossible.
• Marketing options are limited
  When you charge $9–$20 per month, it is hard to fund:
  • Paid acquisition at scale
  • A sales team
  • Heavy outbound

At best, you can usually afford a few channels:

• Organic content
• Some SEO
• Light referral or viral loops

Also, a lot of what people call “B2C SaaS” is not really SaaS.

• Netflix and Spotify are content subscriptions. People pay for media, not for software itself.
• Dropbox is often cited as a consumer SaaS success, but most of its revenue now comes from businesses, not individuals.

There are some bright spots, like fitness or sports‑related subscriptions where people buy gear plus software. But they are rare.

The B2B upside

With B2B SaaS:

• Businesses are used to recurring expenses.
• They are comfortable with higher monthly prices when they see ROI.
• You can deploy the full toolbox of roughly 20 B2B SaaS marketing strategies Rob outlines in The SaaS Playbook.

For agencies, this lines up perfectly with what we already know.

The same is true for productized services, hosted solutions, and memberships built on tools like LifterLMS or WordPress:

• Selling to businesses, even small ones, gives more pricing power.
• You can justify higher retainers when you tie your offer to revenue, lead generation, or cost savings.

If we are thinking about launching a SaaS from our client work, aiming at B2B is usually the saner path.

Marketing SaaS in 2025: Harder, But Still Working

Rob made an honest observation that should ring true to anyone trying to grow a product today:

• In 2008, simply getting a SaaS app built and hosted was the hard part.
• Today, infrastructure is cheap and fast. The code is often the easy part.
• Marketing is where the real difficulty has moved.

He still sees founders succeeding by focusing on a core set of channels.

Rob calls out a “big five” that show up over and over in successful B2B SaaS stories:

1. Content marketing
   Articles, podcasts, videos, guides that attract and educate your niche.
2. SEO
   Ranking for key buying terms and related topics.
3. Integrations and partnerships
   Building on or alongside larger platforms and doing joint promotions.
4. Pay‑per‑click ads
   Search and social ads with a clear funnel behind them.
5. Cold outreach
   Thoughtful outbound email or LinkedIn, not spam, to a defined ICP.

Most products will need a mix of these. Which combination works depends on:

• Who the customer is
• Where they spend time
• How they like to buy

For agency owners, this matches what we see in client work. The stack that works for a local services client is not the same as a B2B SaaS or a course creator, but the categories of tactics are similar.

If we plan to spin up a SaaS or membership product, the reminder is simple: assume marketing will take more creativity, discipline, and time than getting the thing built.

Rob’s Advice to His Younger Self (And To Us)

Looking back, Rob says the biggest thing he would change is how long he tried to do everything alone.

Early on, he:

• Worked as a “one man on an island”
• Avoided employees
• Avoided community and masterminds
• Made mistakes in isolation that took years to unwind

Only later did he realize how much faster you can move when you:

• Spend time with people already doing what you want to do
• Join or form mastermind groups
• Attend events where you can speak openly about numbers, challenges, and experiments

MicroConf and TinySeed grew out of this desire to give bootstrappers a place to belong.

For those of us running agencies, this rings loudly. It is easy to:

• Live inside client work
• Avoid community because we feel behind or different
• Repeat the same problems others have already solved

Rob’s advice, paraphrased for all of us:

Get around positive, ambitious people who are building what you want to build. Do not let the loudest voices in your life be people who do not understand entrepreneurship.

That might be a local WordPress meetup, an online founder community, or a tight group of three to five peers we meet with every month.

A Realistic View Of AI’s Future Impact

We closed with AI again, but from a wider lens.

Rob compares today to earlier hype cycles:

• Late 90s internet boom
• 2008–2012 mobile app rush
• Crypto’s many spikes and crashes

Each time, predictions were extreme:

• “The internet will change everything overnight.”
• “Websites are dead, it will all be mobile apps.”
• “Everything will move to the blockchain.”

Reality was more measured:

• The internet changed almost everything, but over decades.
• Mobile became huge, but websites still matter.
• Crypto and blockchain built some durable pieces, but far less than the marketing promised.

AI will likely follow the same pattern.

Rob’s view:

• AI will have a huge impact, especially on repetitive knowledge work.
• It will hit entry‑level roles hardest, the same way robots hit low‑skill factory jobs.
• It will not replace thoughtful, mid‑ to senior‑level work any time soon.

We already see platforms trained on most of the public internet and still struggling with:

• Hallucinations
• Subtle reasoning errors
• Complex product design and UX decisions

For agencies and freelancers, that means:

• We should use AI heavily as a power tool.
• We should keep improving the skills AI cannot yet mimic well: judgment, taste, communication, and deep problem solving.
• We should expect our junior‑level tasks to shift fast, and plan hiring and training around that.

The winners will be those who combine AI with strong domain knowledge and real responsibility for outcomes.

Are The Glory Days Of SaaS Over?

If by “glory days” we mean:

• Throwing together a mediocre product
• Tossing a few ads at it
• Growing on a wave of hype with no real retention

Then yes, those days are fading. And that is good for serious builders.

If we mean:

• Building calm, profitable, multi‑million dollar software businesses
• Serving focused B2B markets
• Growing through patient marketing and strong product‑market fit

Those days are very much still here.

From Rob’s vantage point, funding hundreds of B2B SaaS founders, we can see that the opportunity has not vanished, it has matured.

For agency owners, freelancers, and course creators, the path is clear:

• Think B2B, not B2C, when you build recurring products.
• Use AI, but do not outsource your entire codebase or strategy to it.
• Aim for product‑market fit, not just revenue spikes.
• Commit to a small number of marketing channels and work them hard.
• Stop doing this alone. Find your people.

Thanks for reading this far. The next step is simple: pick one insight from Rob’s story, and decide how we will apply it to our own business this quarter.