In a decade, The Cloud 100 grew from $99B to $1.1T — proof of the cloud’s compounding power, and just a preview of how AI will shape the next generation of software leaders.
As we celebrate 10 years of The Cloud 100, we’re telling every SaaS leader: evolve or you risk obsolescence.
For those who can’t adapt, AI is a “mass extinction” moment for software. That’s not because the tech is dazzling, but because it is now everywhere, fundamentally transforming human work. For SaaS CEOs, the AI imperative is no longer optional — it’s existential. Leaders must rethink not just the technology beneath their products, but the value they deliver, and the models that sustain them.
Since ChatGPT’s breakout in 2023, we’ve seen how AI has impacted infrastructure, code generation, applications across all industries, and the sheer pace of growth. The new Cloud 100 benchmarks are astonishing: on average, where cloud companies take 7.5 years to reach Centaur status ($100M ARR), AI startups are hitting the same milestone in 5.7 years–or even less in some instances.
While the pace of change is faster, we can still anticipate the trajectory of AI’s commercialization by looking at past paradigm shifts. The cloud era showed us how technology reshapes delivery and monetization — lessons SaaS leaders can study in order to adapt. “Evolve or die” may sound stark, but it’s the reality: within the next one to two years, businesses that fail to cross the chasm from pure SaaS to AI risk irrelevance.
As investors in both Cloud 100 honorees like Canva, ServiceTitan, Twilio, and Toast as well as new AI leaders like Anthropic, Abridge, and Perplexity we see a clear truth: chips and compute are the new steel, and the companies that harness them will define the AI future.
What the Cloud era taught us
The rise of cloud transformed SaaS from fringe to default. Entire industries digitized, reshaping the global economy and producing a new generation of technology leaders. In 2016, we launched the Cloud 100 to track this shift. Over ten years, its honorees grew from $99 billion in cumulative value to more than $1.1 trillion today — a mirror of how innovation spread, from infrastructure to business models to global platforms.
True innovation, the kind that defines generations, never comes from technology alone. Breakthroughs require three forces working together: the new technology itself, the way it’s delivered and the business models that make it scale. With AI, we still think the same three forces will dominate. That’s why entrepreneurs are writing a new playbook in real time to harness the opportunities of AI. Two case studies stand out:
Canva has scaled from a scrappy design democratizer in 2013 to an enterprise staple with more than 240 million monthly users and adoption across 95 percent of the Fortune 500. Its freemium model and bottom-up viral growth made design accessible to anyone, not just technical experts. That same mission now drives its AI evolution: from early experiments in 2017 to the launch of Magic Studio, Canva AI, and acquisitions like MagicBrief. With more than 18 billion uses of its AI tools — including Magic Design, Canva Code, and voice-enabled Canva AI — the platform has cemented itself as a creative co-pilot for both individuals and enterprises. By embedding AI as a competitive moat and solving pain points like brand consistency, content scale, and collaboration, Canva has transformed from a design tool into an indispensable engine powering the modern workflow.
Intercom also offers an early glimpse of what this SaaS to AI-native transition looks like. Long before generative AI went mainstream, the team was experimenting with AI-driven support. In just two years, it transformed from a SaaS CRM platform into an AI leader, with its AI agent, Fin, already bringing in $100 million ARR. We expect many more companies will follow this path — some by building, others by acquiring their way into AI.
New rules for cloud-to-AI founders
For founders making the leap into AI — or even those who are already AI-native — the rules of success are shifting:
- Systems thinkers win. Coding brilliance once defined cloud founders. Today’s AI leaders are holistic builders who understand workflows, pain points, and how new models of delivery reshape markets. Domain insight beats raw coding skill.
- Quality over quantity. The AI talent wars are real, but headcount is no longer a proxy for ambition. AI Supernovas and Shooting Stars are scaling with lean, exceptional teams.
- Defensibility matters. Models alone aren’t moats. Founders must build around unique data, differentiated user experiences, and multimodal workflows that are harder to replicate.
- Human judgment is the edge. Automation makes taste and judgment more important, not less. The best founders will intuit what should exist — not just what can.
Founders charting their path in AI can take comfort in one thing: we’ve seen this kind of transformation before. And while there will be unique nuances in 2025 and beyond, the cloud era offers an initial roadmap for AI founders.
The shape of the Cloud AI market today
The early days of AI seemed to follow the traditional challenger’s market, where AI startups threatened to unseat cloud incumbents. But the reality is more complex. In many markets, incumbents now hold the advantage — wielding massive data sets, distribution networks, and the resources to integrate AI at scale. The David vs. Goliath story is inspiring, and while we love to bet on the David, in some cases, Goliath really does win.
Today, AI companies crystallize into three groups: Incumbents, Challengers, and New Entrants. In design collaboration, for example, Adobe has embedded AI deeply across its Creative Cloud suite, Canva has scaled AI-powered tools to hundreds of millions of users, and Midjourney, a startup born in 2021, has already become a multibillion-dollar player in generative media. This dynamic illustrates the new reality: markets will consolidate around a handful of leaders, but those leaders may come from any of the three camps.
What should founders and investors expect next? A wave of incumbents striking back. After two years of rapid disruption, enterprise giants are catching up — not as much by rebuilding from scratch, but by acquiring AI-native startups, as we’ve seen with Cloud 100 names such as Scale AI, Wiz, Anysphere, among many more. The next 12–24 months will bring a surge of M&A, as incumbents move aggressively to reinvent their value propositions.
But this isn’t simply about bolting on features. The rise of AI is blurring the line between software and service, embedding intelligence so deeply into workflows that these products resemble service providers more than traditional applications. At the same time, demand for AI infrastructure — from orchestration to observability to memory — will drive strategic acquisitions of the building blocks of the AI-native stack.
The lesson: expect fewer markets where a single challenger topples an incumbent. Instead, anticipate ecosystems where incumbents, challengers, and new entrants continuously reshape the field through competition, consolidation, and reinvention.
What investors value in emerging upstarts
The SaaS-to-AI shift is redefining what it means to be a great founder. In the cloud era, technical brilliance and execution speed created winners. In the AI era, those still matter — but they’re no longer enough.
The new edge is velocity with vision. Founders must move fast — but also fast in the right direction. AI isn’t just about better models. It’s about building a better model of the world. The best founders will redefine problems, transform workflows, and invent new business models.
After ten years of the Cloud 100, one truth is clear: the next decade will be even bigger. Just as cloud reshaped the economy, AI will reshape how we work, create, and decide what to build for the future. For founders, this is a once-in-a-generation opportunity.
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Source: https://www.forbes.com/sites/bessemerventurepartners/2025/09/03/how-software-leaders-need-to-adapt-to-ai—or-risk-going-extinct/
