Anthropic’s Claude Code Platform Looks Like a Software Killer

Wall Street may no longer put up with all your SaaS.

Amid the barnstorming debut of Anthropic’s Claude Cowork platform — a layman’s version of its popular and powerful AI coding platform, Code — shares of software as a service (SaaS) firms continued to tumble last week. Not so coincidentally, the downturn comes just as Anthropic seeks a $10 billion fundraising round at a monstrous $350 billion valuation, according to a recent report in The Wall Street Journal. The ultimate disruptor industry may be on the verge of a Big One as “learn to code” gives way to “learn to have AI code for you” and takes the entire SaaS industry down in the process.

No Longer at Your Service

Where OpenAI has gone broad, seeking hundreds of millions of daily users, Anthropic has gone narrower, honing in on business clients. And within its scope, a niche has emerged: tech firms, which can’t get enough of the Code platform (The Wall Street Journal recently reported how software engineers, learning to love the coding agent, have gotten “Claude-pilled”; one said the platform has made him five times more productive). With Code, users can essentially create software that does anything — from analyzing specific datasets to building websites and editing photos. Cowork, meanwhile,  launched in a “research preview” earlier this month, purports to make those tools accessible to the common dolts among us (present company included). 

Unsurprisingly, that has made it a really tough time to be a SaaS company that provides the tools to do, well, any of these things. Anything SaaS can do, Claude can do better, more specific, more tailored. That’s the pitch anyway, and so far, Wall Street is eating it up:

• Shares of predominant SaaS firms Adobe, HubSpot and Salesforce fell 1.1%, 1.6% and 2%, respectively, last week. The iShares Expanded Tech-Software Sector ETF, which includes a couple of AI plays mixed in with pure SaaS players, is down about 8% year-to-date, while a basket of 15 SaaS firms tracked in a Morgan Stanley index opened the year down 15% through January 18, according to a Bloomberg report. (Morgan Stanley did not respond to a request from The Daily Upside for more recent data.)
• “Many buy-siders see no reasons to own software, no matter how cheap or beaten down the stocks get … They assume zero catalysts for a re-rate exist right now,” Mizuho Securities tech sector analyst Jordan Klein wrote in a note earlier this month, per Bloomberg. 

Paying Off: For Anthropic, all that coding is paying off. The company said Code drew $1 billion in annual recurring revenue last year; it expects that figure to grow by another $100 million this year, sources recently told Wired. Meanwhile, Cowork is now available to any user on the $20-per-month Pro tier. On the flip side, the coding agents appear (unsurprisingly) quite energy-intensive. In a blog post, one software engineer recently found that a Claude Code session required vastly more energy than the median ChatGPT query (though slightly less than toasting bread for three minutes).