SaaS leaders’ strategy to staying ahead of the AI boom

The increasing adoption of artificial intelligence (AI) is disrupting the SaaS landscape, enabling businesses to stay competitive in a changing market.

According to a report by SaaSBOOMiand McKinsey & Company, the Indian SaaS ecosystem is poised to achieve $50-70 billion in revenue and exceed $500 billion in enterprise value by 2030.

The pressing question is: How can SaaS startups capitalise on AI early and adopt strategies to stay competitive?

At the Tamil Nadu Story 2024, hosted by YourStory in Chennai—the SaaS capital of India—industry leaders gathered to explore the current state of Indian SaaS and AI, along with strategic go-to-market strategies for business. 

Sector disruption by AI

The session began with the panellists discussing the most disrupted sector by AI. Khuze Siam, Founder of Siam Computing, says there isn’t a single sector that hasn't been disrupted by the new technology.

“I think we are at an inflection point. In our generation, we have seen mobile happening in 2008-2010. And then the cloud revolution happened. We're lucky to see that the AI inflection is going to happen and all industries are going to get disrupted. I don't think there is anything that you can say, that one in particular is going to be disrupted more or not..,” said Siam. 

After spending over a decade helping startups, Kuppulakshmi Krishnamoorthy, Global Head - Zoho for Startups, Zoho Corporationbelieves agriculture, education and pharmaceuticals are the top three sectors on her list. 

Healthcare is another crucial sector disrupted by AI, says Arunkumar Kumaresan, Regional Head - GCC region, Kovai.co. 

“We have all seen how AI is changing our lives. Most of us are aware that the disruption has already happened in the digital marketing, digital content and education sector. We are seeing more disruptions happening in healthcare as well. For example, my brother-in-law works for a company that does 3D modelling of damaged bones after accidents and rebuilds it,” said Kovai.co's Kumaresan. 

Prabhu Ramachandran, CEO of Facilio, who has over 18 years of experience in product development and business management said that AI is currently advancing in three key areas: vision, text, and voice automation. 

“From a tech point of view, there are three areas where AI is already happening — automation around vision, text and voice. In turn more specifically in terms of how our customer support is done, how a document is processed… These are already happening. And as we speak, it will expand into more truly GenAI,” said Ramachandran. 

Building the right product

Several products today are developed to boost user engagement, build loyalty, and skyrocket conversions by delivering spot-on content and features specific to each user. The secret sauce, according to Siam, is personalisation. 

The serial entrepreneur, who has helped several startups with their product development processes, said, “The best product is a product of one. The product that is uniquely built for you. The reason people are so addicted to Instagram is because my experience of Instagram is very different from your experience. The type of reels I see are very different from the types of reels you will see.” 

Founded in 2012, Siam Computing is a product development firm that specialises in creating digital solutions from concept to market launch. 

“AI is helping us personalise the experience of products a lot. Zepto knows the way in advance what I'm going to be cooking today…All of that is happening really well in terms of how AI is going to be used to personalise and build products that are eventually going to be products of one. And my experience is going to be truly unique to me,” he added. 

With strong expertise in IoT-based services and sustainable building solutions, Facilio’s Ramachandran highlighted the importance of automation and verticalisation of SaaS products to win at a global scale.

He emphasises three key opportunities from the India-SaaS and AI combination. One, is the rapid AI adoption by Indian SaaS companies to sell and compete globally. Second, he believes collaboration between call centre professionals and SaaS founders can solve business automation challenges. 

“The third one is broadly even in SaaS — the first wave of SaaS was horizontal SaaS, where it could be like a CRM or helpdesk product, accounting software. The next generation of SaaS moved into more vertical. How can SaaS be built for running a hospital? Like at Facilio, we are into real estate as a vertical…on how we can help customers to run buildings better. So that is the next area where there could be more very vertical SaaS companies using AI to differentiate and win globally,” he said. 

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Grabbing the bigger chunk

However, helping customers embrace AI can help companies capture major businesses in SaaS, added Kumaresan.  

“So most often when we say AI, people get overwhelmed. AI is something that you cannot neglect and that is the future going forward. So what we can do as Indian companies to capture major businesses in SaaS is help your customers embrace AI,” Kumaresan said. 

Kumaresan has held various roles that have contributed to his expertise in customer service and knowledge management.

He further noted that Indians excel in providing quality customer support, and we should leverage this strength.

In contrast, Zoho's Krishnamoorthy says that staying ahead of the curve might be a slippery slope too. 

“There is a pressure to bring AI into everything. And the one thing that we constantly hear is stay ahead of the curve. So staying ahead of the curve, sometimes is a slippery slope. At Zoho, when we sell 50 Plus applications, it has to make sense to the end user for which it has to make sense to us. Instead of boasting about 50 Plus applications in the offer, how can it help your business?” she said. 

When it comes to AI, customer delight is what makes businesses grow, the panelists said.

“The whole point of bringing AI is to do two things: to free yourself up for time. And what are you going to do with that time because there are 50 other businesses that are trying to solve the same problem with similar services as yours. So the greatest edge is your customer delight — that only a human element can solve,” Krishnamoorthy added.