Legendary investor Navar: Apple is dead, SaaS will follow, and the entrepreneurs will have 18 months to reshape the moat
Author:Mustufa Khan
Other Organiser
Apple is dead, just hasn't submitted an official document。
This is not a horrifying view, but rather a structural reading of what has happened over the past six months and what Naval Ravikant confirmed last week in his podcast. The most patient investor in science and technology, and one of the smartest capital distributors in the last 20 years, has just made the following assessment of the entire software industry: the pure software industry is not worth investing in。
If you are the founder of the reading, the question is not whether you believe it, but whether you have 18 months to reposition it so that the market does not notice it。
Background: Naval is the founder of AngelList and early investor in Twitter, Uber, Notion and some 200 other companies that have shaped the technology landscape of the last decade. He rarely posts. But every post sent, he took it in his own words, as if he knew that what he had said would be repeated by later generations. So when he said without reservation that “software is not worth investing”, this was not a comment, but a theory。
The following is what he said and what this means for all who are building houses。
No one can stop the structural death of apples
Apples don't go bankrupt. The apple product won't disappear from your pocket next year. The collapse described by Navar was not at the operational level, but at the economic level。
Apple's market value of $3 trillion is based entirely on one point: Prominent software experiences support the profits of high-end hardware. Once this experience is lost, apples become a better tristar. And that's what's happening。
The interface layer is being commercialized in real time. In less than 24 months, most people will no longer open their applications as they are now, but will speak directly to intelligent clients. The customer service will generate the required interface immediately in response to user needs. Apple's well-designed app store, personal interface guide, finely crafted design, ecosystem lock-in - all of which will become irrelevant because the interface itself is created in real time by artificial intelligence operating on any mobile phone。
What's Apple's response to this transition? They got Gemini's authorization from Google. Their own investment in artificial intelligence did not meet expectations. This company, which once centred on controlling the user experience, now outsources the user experience to the largest competitors。
It's a fast-track version of the Microsoft Post-Moving Age strategy。
Microsoft had missed the mobile market because they refused to build a primary touchus operating system from scratch. Their dominance in the previous era convinced them that the old model remained valid. By the time they accepted the new model, apples had won the next decade. Microsoft remains a concern. Today, $3 trillion, Microsoft Windows loses the consumer war they could have won。
Apples now make the same mistakes in artificial intelligence. Their positioning as “hardware priorities” can help them to successfully transform their smart agents. But that doesn't work。When the operating system is commodified, the profit margin for apples will also be reduced to the same level as for ordinary hardware. This will lead to a structural income collapse of its most profitable business blocks — which also underpin all other operations。
You can keep the apple stock. Just don't expect you to hold shares in a growing company。
The most valuable hardware company in history is about to find out what value its hardware would have had it not been for software。
If your moat is software, you have 18 months
If you're the founder, then that's the harder part。
Navar says pure software is not worth investing. He's right. He did not explain, however, what that meant for thousands of SaaS companies currently holding the A and B financing valuations, which were raising money in another world。
This means that most of them are dead, but they themselves do not know。
The truth is simple. Your SaaS company exists because it's very difficult to develop your product. You can raise money because technological realization requires a team。Whether you publicly admit it or not, your moat is about the difficulty of replicating the products you create。
That dilemma was solved。
A two-person team using Claude Code can now copy 80% of most B2B SaaS products within 90 days. This is not a toy version, but a functional version with a well-structured, basic security and scalability. The remaining 20% — your specific integration, business sales processes and compliance systems — is the real problem. But this is not a moat, it is friction. These frictions will gradually decrease with the quarterly issuance of a new generation of agents。
Look what's happened. Adobe acquired Figma in 2022 with $20 billion. Figma ' s product structure was difficult to construct and was therefore phased out. Today, the functionality is equivalent to 70% of Figma ' s core function design tool, delivered by independent developers in a few months. Salesforce is the most valuable SaaS company in history. The AI original CRM system, which did not exist 18 months ago, has now begun to encroach on the market at its end. Workday, Servicenow, Atlassian, Asana, each of them may be replaced by AI-based CRM systems, which are even smaller in size than their human resources units。
Companies that can survive this change will not be those with the best software. The software will eventually die. The companies that survive will be those that create things that artificial intelligence cannot replicate:
Distribution channels. Network effects. Data wheel. Hardware integration. Brand. Community. Regulatory depth. These are the only durable means of defence in the new world。
If your real answer to "What's our moat" is "Our product is better," then you have 18 months to find a true moat, or you will watch your valuation shrink 70-90 percent in the next round of financing。
Those who can survive this change are those who read such articles and take the situation seriously. And those who put it on fire, in 2027, I'm afraid they're going to publish the job cuts on LinkedIn and wonder why all this happened so quickly。
Which one are you
The company that won the next decade is not developing software
If pure software is dead, what is really worth investing in? Navar clearly indicates in podcasts: hardware, artificial intelligence models and network-effect enterprises. Let me elaborate further on what practical actions the founders can take this quarter。
Distribution became a new moat。
Successful companies today do not possess the best products, but rather establish the most direct contact with their clients. The product is only a service carrier for customers. Your audience is your moat. Your mailing list is your moat. Your community is your moat. Your reputation is your moat。
If you, as a founder, still think that “marketing” is the stage to be made after the product is finished, then you have failed. Today, marketing itself is a product. Products are the result of attracting attention。
Network effects superimpose。
In the wave of commercialization of artificial intelligence, the values of those businesses that survive are not derived from the function itself, but from other users. Discord, Roblox, LinkedIn, Reddit, these enterprises are hard to replicate not because of the complexity of their software, but because their user groups are locked in by other users。
If your product improves significantly as the number of users increases, it will survive. If your product is the same for 100 or 100,000 users, you're finished. Artificial intelligence can copy functions, but they cannot copy user groups。
Data wheel。
Companies that can train better models, collect proprietary data through user interaction and build feedback loops that competitors cannot replicate can survive. For example, Tesla's autopilot data, Bloomberg terminal data, etc. The data themselves have cumulative effects, which are not available in the software that applies normal data。
IF YOUR PRODUCT GENERATES UNIQUE DATA EVERY TIME YOU INTERACT, IT'S VALUABLE. IF YOUR PRODUCT IS BASED ON A PUBLIC API USER INTERFACE, THEN IT'S OF LITTLE VALUE。
Hardware integration。
Companies with physical assets receive the most sustained protection. For example, Tesla, Anduril, SpaceX, Apple Chip Business (not Apple Applications), Boston Dynamics. Hardware manufacture is difficult. Artificial intelligence does not produce chips, batteries or rockets. The real world remains the most enduring moat of the entire economic system。
Vertical depth。
The weaknesses of the horizontal SaaS giants were revealed. This is not the case for vertical field specialists who have knowledge of industry-specific workflows, data and networking. The generic project management tool has been eliminated, but the construction industry-specific platform with licensing processes, inspection networks and regulatory data remains intact. In-depth study of an industry is far better than in 10 industries。
If you are rebuilding a strategy now, the question arises: in the next 12 months, what moats can you build for your business? Not one day, but now. Since the founders of the first strategic adjustments were able to seize the market share of the survivors when other enterprises collapsed。
The other side of the crash is the greatest opportunity in history
Most entrepreneurs tend to ignore this when reading articles about the demise of software. They focus only on what is dying, while ignoring the new possibilities that are emerging。
The most optimistic view among podcasts is that software is leading to the revival of individual creators, not the demise of software, but its democratization。
Historical patterns already exist. Notch released minecraft alone. Markus Frind runs the Prince of Fish. Instagram's original team of 13 people was bought by Facebook only for annual profits. The $1 billion WhatsApp had 55 employees at the time. $19 billion out. These companies represent one ' s uncompromising vision, which eventually translates into a product, without a dilution of the vision as in the case of teamwork。
Every incident is unusual. They should not have reached that scale。
What has changed is the ceiling. In the past, the founders of single-handedness might have made interesting products, but there were obstacles to scaling up. Teams must expand, compromise comes and visions are gradually diluted. The original uniqueness of the product, like all the other products operated by the Commission, was tempered by forces。
Naval’s vision is to create a company that is run by one person but can achieve 50-person team efficiency。users submit bug reports by applying internal buttons. the reports are reviewed every 24 hours. clients prepare restoration programs, submit a pull request and run tests. the founders review, approve and publish. client support is the responsibility of a client who is able to write the underlying problems of code repair. functional requests are decided by the user vote, the client is responsible for their development, and the founders turn off the quality。
There is no need for coordination, no political struggle, no vision of compromise, no engineer contests the particular circumstances to which the founders attach importance, no designer disputes the location of the icon, and no product manager weakens a bold version for the sake of conservatism。
The vision of the founders was fully realized, from the mind to the end product。
This is not rhetorical, but is happening in certain areas. Pieter Levers, an independent operator, has created a number of enterprises with seven digits of annual income. An increasing number of independent hackers are running operations that required A round of financing three years ago. The independent operator movement in artificially intelligent primary fields is creating unforeseeable results for the venture capital industry。
The next company, with a billion dollars, may have only one employee. The next unicorn company may have fewer than 10 employees。
If you're a creator, operator, marketer or founder who's been waiting for a building permit, then the permit has arrived. Technical bottlenecks no longer exist and start-up funds have been depleted. Now, the only obstacle between you and the real business is whether you have what you want to say, a keen insight into good work and a self-discipline to put it into practice。
It is either the worst time in history to develop generic software or the best time in history to develop front-line products。
Both. Which one of these things applies to you depends entirely on your actions for the next 18 months。
The 18-month window is currently open
You have three options。
Option one: all of this is considered a setup. Convince yourself that Apple is big enough not to collapse; that your SaaS is different; that artificial intelligence coders are overbroaded; and that everything will pass. You're not alone. Most of the founders will choose this path. And most of the founders end up failing。
Second option: panic. Sudden cuts in funding, dismissal of teams and hasty transition. That is the consequence of being too late to wake up. Those who were destroyed by this transformation were not those who anticipated it, but those who were 12 months late and had to reposition themselves under pressure, without funds, without time to test and without leverage。
Option three: Take these 18-month window periods seriously. An honest assessment of your moat. Distribution channels are established before need arises. Finds the advantages of artificial intelligence that cannot be replicated. Prepare for the coming world, not for a world that you want to stay the same。
Naval, if you like. “Preliminary software investment is not worth it. So it is.” This is not the rhetoric, it is the mouth of a man who has spent 20 years identifying which projects are worth investing, but who now concludes that most funded projects are not worth investing。
Apple's gone. Most SaaS founders will follow suit. And those who eventually survive will be those who listen and act before others realize that。
Now the window of opportunity is open, but it will not remain open forever。
The question is, are you going to spend the next 18 months building a moat that can stand up, or are you going to watch your existing moat just a little bit eroded。
Most people can't, some can. The difference is your performance this quarter。
