Monday.com CEO: AI Expands Software Market
Despite a market sentiment shift against SaaS, Monday.com CEO Eran Zinman argues that AI agents will expand the software market, not shrink it. He predicts that while building a UI is now easy, maintaining and supporting software at scale remains hard, and that LLM providers will likely function as infrastructure players like AWS, not direct competitors.
monday.com's AI strategy centers on embedding AI into its existing Work OS platform, rather than creating separate, standalone features. The company announced its AI vision for 2025, which revolves around three pillars: AI Blocks for customizable workflows, Product Power-ups to enhance existing tools, and a "Digital Workforce" of AI agents to automate tasks. This approach aims to make AI accessible to its large non-technical user base, which makes up 70% of its over 250,000 customers. The company has already seen significant adoption, with customers executing over 17 million AI-powered actions in the last few months of 2024. One of the most successful use cases has been processing unstructured data, such as screening CVs, analyzing invoices, and reviewing RFPs. To further drive adoption, monday.com offers 500 free AI credits per month to all users, with scalable pricing for higher usage. This AI-driven approach is credited with helping the company project $1.2 billion in revenue for 2025 and has significantly boosted investor confidence. In February 2025, the company's stock surged over 26% following its earnings report and AI strategy announcement. This has been seen by some as a market shift from focusing on AI infrastructure to AI-powered applications that deliver tangible business results. Zinman's argument that LLM providers will act as infrastructure is supported by the strategy of players like Amazon Web Services. AWS Bedrock offers access to various foundation models from companies like Anthropic, Cohere, and Meta through a single API, allowing developers to build on top of this infrastructure without managing it themselves. This creates a platform for companies like monday.com to build their specific applications. The broader trend in the low-code/no-code market, which is projected to exceed $30 billion in 2026, aligns with Zinman's outlook. Analysts predict that by 2026, 80% of low-code/no-code users will be business professionals outside of IT. AI is seen as an enhancer of these platforms, not a replacement, by automating tasks and making development more accessible to non-technical users. Despite a general downturn in SaaS funding, which saw a 73% drop in 2024, AI-focused companies have continued to attract significant investment. Venture capital investment is now heavily concentrated in the AI sector, with investors looking for companies with proven product-market fit and strong fundamentals. This selective funding environment favors established platforms like monday.com that are successfully integrating AI to drive growth and profitability.
