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There Is No Single AI Strategy for Software

August 27, 2026

Enterprise software is said to be facing an adapt-or-die moment.1

Companies will “agentify,” the argument goes, replacing their static interfaces and basic automation with Agentic AI. Or they won’t, and more capable tools from leading model providers will displace them. 

Down one path, the potential for another exponential phase of growth. Down the other, obsolescence. 

There’s no question that AI is creating new pressure for enterprise software companies, and we believe “agentification” has become the market’s prescribed response. But what that means in practice is broader than the term suggests. Software has more than one path to harnessing AI, each with distinct opportunities to build and compound value over time. 

Path One: Product Transformation, or The Revenue Opportunity  

Historically, software supported operational workflows, but it did not perform them. A human was in the driver’s seat.  

Agentic AI executes work itself. These systems reason, make decisions and carry out multi-step workflows without human intervention.

Some enterprise software companies are now agentifying their products, re-architecting them to perform work autonomously. This is a technological transition, but also an economic one.

Previously, the value of enterprise software was always capped by the number of people using it. Agents have no such constraint. They can work 24 hours a day, 7 days a week, and spawn sub-agents to scale their production exponentially over time. This challenges the logic of the traditional seat-based pricing model. When software is agentified, its economics can scale with the amount of work performed, rather than just the number of users.

Under this new model, software may for the first time capture budgets historically allocated to labor and services, which can significantly expand the category’s addressable market. We believe this is the revenue opportunity for enterprise software. 

There can be no assurance that the method illustrated above, or similar methods will be effective or have the illustrated outcome. There is no guarantee that AI will be used in any such capacities. The use of generative AI technology presents certain risks including, but not limited to, the risk the technology generates hallucinations and/or inaccurate information.

“The Agentic AI era is here, and it will likely prove to be the most valuable chapter in software’s history.”

Robert F. Smith

Founder, Chairman & CEO of Vista Equity Partners

Path Two: Operational Transformation, or The Margin Opportunity 

Not every enterprise software company is well suited to directly agentify its products, or at least not immediately. But contrary to the adapt-or-die framing, they need not miss out on the opportunity for AI-led value creation.

We believe companies can embed AI within their own operations to help improve how efficiently they analyze data, respond to customer needs, and launch products. Software development, long constrained by the cost and scarcity of engineering talent, is being reshaped by generative AI and code-assist tools.

In Vista’s portfolio, teams that adopt AI effectively are bringing new features to market and meeting customer demands faster. The result can be a more efficient cost profile, with gains that may compound as AI capabilities mature and adoption expands. We believe this represents a meaningful margin opportunity for enterprise software.

Which Path Is Right for Your Business? 

We believe different paths to AI-led value creation are not mutually exclusive. Many enterprise software companies can expand their addressable markets while improving margins and operational efficiency.

But many businesses are asking where to focus first. A few practical considerations we believe help guide that decision:

  • How agentifiable is the workflow? Products built around repeatable, multi-step processes with clear objectives and decision points are better suited to agentification than those that primarily provide information or infrastructure.
  • Do you have the context to support autonomy? Agents need access to the underlying customer data, business rules, workflow history, and system permissions required to make reliable decisions and take action. Companies that already own this context are better positioned to agentify their products.
  • How much human judgment does the work require? Some workflows can tolerate substantial autonomy today; others still require frequent human review. The more consequential or ambiguous the decisions, or the greater the regulatory exposure, the harder it may be to agentify.
  • Are you ready for the economic transition? Moving beyond seat-based pricing requires a clear understanding of customers’ willingness to adapt to a new economic model and a reliable way to meter the work agents perform. Companies should have both in place before changing how they monetize their products.

The Case for Software 

Enterprise software has weathered periods of technological dislocation before, such as the transition from on-prem to cloud. Each time, the category has emerged stronger. We believe this cycle will be no different.

We believe that today, software businesses may have several promising ways to build and compound value in an AI-driven market. Genuine displacement risk may be concentrated among companies with shallow customer data and generic solutions, not those entering this transition from a position of strength.

Across Vista’s portfolio, these opportunities have already taken shape. Enterprise software businesses like Duck Creek, Sonatype and Nexthink are seeing accelerating annual recurring revenue (ARR) growth and greater research and development (R&D) efficiency as they adopt AI.  

For a closer look at these case studies and the lessons they offer other software businesses, read our full report, Software’s Transition to Agentic Enterprise AI.

1. https://www.wsj.com/tech/ai/saas-software-as-a-service-apocalypse-ai-b9b6da99?st=xnqCBm&reflink=desktopwebshare_permalink

This document does not constitute an offer to sell any securities or the solicitation of an offer to purchase any securities. This document discusses broad market, industry or sector trends, or other general economic, market or political conditions and should not be construed as research, investment advice, or any investment recommendation.

Statements contained in this document (including those relating to current and future market conditions and trends in respect thereof) that are not historical facts are based on current expectations, estimates, projections, targets, opinions, beliefs, and/or assumptions Vista considers reasonable. Such statements involve known and unknown risks, uncertainties and other factors, and undue reliance should not be placed thereon. In addition, no representation or warranty is made with respect to the reasonableness of any estimates, forecasts, illustrations, prospects or returns, which should be regarded as illustrative only, or that any profits will be realized. Certain information contained herein constitutes “forward-looking statements,” which can be identified by the use of terms such as “may”, “will”, “should”, “expect”, “project”, “estimate”, “intend”, “continue”, “target” or “believe” (or the negatives thereof) or other variations thereon or comparable terminology. Due to various risks and uncertainties actual events or results may differ materially from those reflected or contemplated in such forward-looking statements. No representation or warranty is made as to future performance or such forward-looking statements.

Certain information contained in this document has been obtained from published and non-published sources prepared by other parties, which in certain cases have not been updated through the date hereof. While such information is believed to be reliable, Vista does not assume any responsibility for the accuracy or completeness of such information and such information has not been independently verified by it. Except where otherwise indicated herein, the information provided in this document is based on matters as they exist as of the date of preparation of this document and not as of any future date and will not be updated or otherwise revised to reflect information that subsequently becomes available, or circumstances existing or changes occurring after the date hereof, or for any other reason.

No representation or warranty, either express or implied, is provided in relation to the accuracy or completeness of the information contained herein.

Artificial intelligence technology models (“AI”), including generative artificial intelligence and similar technologies (“GenAI”), can pose risks to Vista, the Funds, and their investments. AI is an emerging and rapidly evolving technology and therefore it is difficult to fully assess the risks associated with it and those posed to Vista, the Funds, and/or the Funds’ investments. Vista endeavors to evaluate AI models and related risks before using them in its business. However, there can be no assurance that it will do so successfully, and the use of AI may adversely affect Vista and the Funds and/or the Funds’ investments. Vista is exposed to the risks of these developing and evolving technologies, including in situations where AI is used by third-party service, data, or information vendors, or by companies where the Funds have or are considering an investment. Use of AI implicates risks resulting from inaccuracies in data input and output or signals, modeling, and information security and related regulatory developments, among others. Vista and/or the Funds could incur liability or expenses in connection with claims of infringement or similar claims by third parties related to information which Vista receives through GenAI. As a result, these risks may subject Vista to potential litigation (particularly trademark, licensing terms of use, and copyright claims), conflicts of interest, and/or other legal or operational risks. It is possible that new regulations may emerge in this area which impedes or hinders Vista’s ability to use AI in the future. The adoption of proposed regulatory rules regulating AI and other similar systems may also impose additional obligations and expenses on Vista. Vista’s practices regarding the use of AI could potentially disadvantage Vista competitively and there can be no assurance that Vista’s anticipated use of AI will be able to continue without restrictive regulatory requirements. Any of the foregoing factors could have a material and adverse effect on Vista, the Funds and the portfolio companies. As referenced herein, “Agentic AI” refers to AI systems capable of understanding a broader goal and coordinating, to varying degrees, the steps and decisions needed to

pursue it and “AI Agent” refers to an AI-powered component that can perceive context, reason about next steps, and take actions toward a specific task, either independently or as part of a larger agentic workflow.

Additional important disclosures can be found here. ©2026 Vista

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