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The Latest SaaStr on 20VC: The State of SaaS 2025: IPOs, AI, and the Coming Shakeout
- The article discusses the state of SaaS in 2025, focusing on IPOs, AI, and upcoming shakeouts.
- Chime's IPO at a $10-12B valuation signals the opening of the IPO window for startups with significant revenue growth.
- Late-stage investors may have protection ratchets in place to adjust shares if IPO valuations differ.
- AI deployment is at a peak with concerns over the proliferation of AI tools and potential bubble.
- Certain AI deals are considered 'run fast' opportunities, emphasizing building defensible moats quickly.
- The article highlights the increasing challenge for early-stage investors to achieve significant returns.
- Exit values are concentrating in fewer mega-outcomes, pushing for 10x+ wins for early-stage investors.
- Companies preparing for the SaaS shakeout must focus on building true workflow automation and network effects.
- Successful SaaS companies are advised to plan defensibility strategies, evaluate AI integration, and consider IPO readiness.
- Legal battle insights between companies like Rippling and Deel underscore the importance of trade secret protection.
- Microsoft's move to open-source VS Code reflects competitive pressures from startups, offering opportunities for nimble players.
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