We must think about AI in steps. Generalizing that everything will be fully automated is a stretch. The market is not discerning between must-have critical systems and replaceable software.

Headlines like 'software is dead' are typically a sign of capitulation and signal a bottom. Believes things have gone too far.

Growth rates have slowed from 20-30% to mid-teens, justifying valuation compression, but not a complete displacement.

AI is having an impact because you don't need as many seats. There's a shift from seat-based to consumption-based business models.

Upsell depends on add-on products, which now must be AI-based. You can't develop old-fashioned products anymore; that's done.

Similar pattern happened with coding agents hitting DevOps stocks. Now it's happening in legal/document analysis.

It is a valuation story. These companies were rich on multiples. Investors are selling everything in software indiscriminately, not discerning between critical and replaceable systems. This is a sign of indiscriminate selling, and at some point we'll have a bottom.