Key software names are down some double digits this year, but the so-called Sapocalypse could be an opportunity instead of a risk, and that is because companies like Salesforce, as well as ServiceNow, which have seen their share prices hit hard by AI disruption, are themselves pivoting their AI strategies.
Now ServiceNow is accelerating its AI roadmap while Salesforce is utilizing their data cloud as well as Einstein AI branding.
Now some analysts say the tech won't be the end of established software giants that are well positioned to work with the technology.
Well joining us to weigh in this morning is Bruce Cleveland, CEO of Traction Gap Partners.
Good morning, Bruce.
Thank you so much for joining us and we look forward to this discussion.
So service now and salesforce shares have been hit hard by AI disruption concerns.
So why do you say that they are positioned well to embrace the technology.
Well, the basic issue is that AI really needs a lot of data to be able to operate against, and Salesforce has a lot of operating data to to run AI processes against.
So consequently, even though the company made its claim on per user pricing, using software as a service as a business model.
Um, and AI is focusing more on the outcomes of executing a variety of business operations.
The fact is that that making that transition to a hybrid business model using both a per per seat licensing as well as this hybrid notion of outcomes-based pricing, I think puts them in a very, very good position along with some of the other of the top SAS companies.
It does seem as though every year we add new terms to our lexicon.
So this year it seems as though the term so far in 2026 is apocalypse.
So what do you think will thrive post apocalypse?
Well, there's a lot of new AI native companies.
For example, in FinTech, one company is Parley Finance, and they've invented a whole new type of category of software called a loan intelligence system.
And rather than replacing the loan origination systems out there from companies like Encino and Abrego, these things augment those systems, so they build on the data that's already.
Embedded in those those applications.
So what I believe is going to really happen is that the primary, the top providers in a particular market, in this case I'm talking about FinTech, but in any particular market there's going to be a set of AI native companies that emerge and they're going to partner with those companies together.
So they're going to augment the capabilities of the current company. or the current market leaders while simultaneously building new categories and building on top of their success.
Yeah, and Bruce, while I have you here, I do want to get your take on market engineering.
So take us through how it's important to FinTech in this era of artificial intelligence.
Well, I think market engineering first, the term itself is a term that includes 5 tenets, things like defining a category or redefining the existing category.
A positioning, messaging, storytelling, and all of that leads to thought leadership.
Those five tenets are the things that give you a, a, a point of view in the industry where people will work with you.
AI doesn't replace this, by the way.
It simply necessitates it.
So we position our company correctly, we position our products, and so this process, this systematic process of defining these categories.
And positioning yourself in a place to win is even more important.
We can do that both as humans but also through AI.
And one of the things that's happening right now with with not just in fintech but in every company is we are changing our websites so that way the large language models, the LLMs, can pick up the information digitally about those companies and present them when people have questions.
And want some sort of response to their to to those questions.
So search engine optimization has been something for a while, SEO, that's been a long time, but this new thing, this way for LLMs to to scan our websites and to be able to present that information, that's something that has emerged.
And if we don't do that, if companies don't do that, you become basically invisible because The AIs are picking up that information and presenting it.
So this is, I think, a big opportunity for for all companies and especially in banking where they need to position themselves for consumers.
It's going to be critically important as more and more of this information is going to be picked up by AI and presented to them when they have questions, typically through these browsing sessions that we've used for the last several decades.
Well, Bruce, we will have to leave it there for today, but thank you so much for joining us and thank you so much for sharing your insights as well as your perspective.
Great, thank you for having me.
