In episode #331, Ben breaks down the true financial and economic differences between a SaaS company and an AI company. Inspired by a tweet claiming that “SaaS metrics are broken” and that AI companies generate more absolute profit per customer, Ben puts the theory to the test using real financial modeling.

This episode walks through detailed revenue, gross margin, EBITDA, pricing power, TAM dynamics, and unit economics scenarios to determine whether AI companies actually outperform SaaS businesses.

What This Episode Covers

Why investors are questioning traditional SaaS metrics when evaluating AI companies
The importance of recurring revenue fundamentals, whether the company is SaaS or AI
A side-by-side comparison of a $1M SaaS company versus a $1M AI company
Gross margin profiles: 80 percent SaaS vs. 55 percent AI
How EBITDA changes when OpEx is held constant
The revenue scale required for an AI company to match SaaS gross profit
The revenue scale required for an AI company to match SaaS EBITDA
Why AI companies need a TAM that is 6x larger
How pricing power tied to labor displacement can shift AI unit economics
Modeling ARPA increases to see when AI gross profit matches SaaS
Why the underlying P&L structure does not change, but the inputs do
How founders should think about forecasting and financial strategy when building AI-native products

Why This Matters

Founders embedding AI into SaaS products
AI-native startups modeling their financial future
CFOs and FP&A leaders forecasting revenue, cash, and margins
Investors evaluating early-stage AI companies
Operators building long-term company valuation strategies

Ben emphasizes that the P&L, revenue streams, cost structure, and core KPI’s still apply. What changes are the inputs—gross margin profile, pricing power, TAM, ACV, and scalability assumptions.

Resources Mentioned

Full blog post with financial modeling examples: https://www.thesaascfo.com/the-real-economics-of-saas-versus-ai-companies
SaaS metrics course: https://www.thesaasacademy.com/the-saas-metrics-foundation

The Real Economics of SaaS versus AI Companies

SaaS Metrics School