Startups For the Rest of Us

Episode 813 | SaaS Predictions for 2026 (+ Reflections on 2025)

December 30, 2025

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  • The host's 2025 predictions were largely inaccurate, scoring only 1.5 out of 9, highlighting the speculative nature of future forecasting. 
  • Horizontal SaaS startups aiming for significant ARR growth will face massive headwinds in 2026 due to market saturation and competition from venture-backed and AI-first companies. 
  • Over-reliance on SEO as a primary marketing channel will become increasingly problematic for SaaS founders in 2026 as the market becomes more crowded and AI shifts discovery patterns. 

Segments

Reviewing 2025 Predictions
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(00:00:03)
  • Key Takeaway: The host revisited and rated his nine predictions made for the year 2025.
  • Summary: Rob Walling reviewed his 2025 predictions, noting that most were inaccurate, resulting in a total score of only 1.5 out of 9, emphasizing the difficulty of accurate forecasting. Concepts frequently revisited during the year included SaaS plateaus and the Core Four skill set hierarchy for founders. He highlighted favorite episodes covering his entrepreneurial mistakes, best decisions, and the 12 commandments of Startups for the Rest of Us.
2025 Prediction Debrief
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(00:04:21)
  • Key Takeaway: Only two of nine 2025 predictions earned partial credit, with most failing outright.
  • Summary: The prediction that Twitter would change hands received half credit due to an internal acquisition by XAI. The prediction that no-code/low-code tools would gain unit tests and version control was rated a zero, despite tooling maturation. The prediction that Google organic SEO volume would drop 15% due to AI searches was also rated a zero, though the shift toward AI search is perceived as inevitable.
2026 SaaS Predictions Start
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(00:12:36)
  • Key Takeaway: Horizontal bootstrapped SaaS faces massive headwinds, while top brands will consolidate market share via AI recommendations.
  • Summary: Bootstrapped horizontal SaaS companies aiming for high ARR will struggle significantly in 2026 due to market flooding by venture-backed and AI-first competitors. Over-reliance on SEO marketing will prove problematic as that channel becomes more crowded and less effective for new customer acquisition. AI chat interfaces will exacerbate market concentration by recommending only a short list of top brands in any given category.
AI and Financial Predictions
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(00:21:03)
  • Key Takeaway: The AI VC bubble will sustain investment, and open-source AI models are predicted to double their usage share.
  • Summary: The massive venture capital investment in AI, estimated at $190 billion in 2025, is predicted not to burst dramatically in 2026. Open-source AI models are boldly predicted to double their global usage share from 20% to 40% by the end of 2026, driven by cost control needs. At least one major no-code platform is expected to struggle or fail as AI-assisted coding removes its core value proposition.
M&A and Bitcoin Outlook
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(00:23:33)
  • Key Takeaway: M&A activity for small, fast-growing SaaS companies will accelerate, and Bitcoin is predicted to hit a new all-time high.
  • Summary: Merger and acquisition activity is expected to increase in 2026, fueled by large AI companies seeking growth by acquiring smaller, fast-growing B2B SaaS firms (e.g., $1M to $10M ARR). Bitcoin is predicted to reach a new all-time high, potentially hitting $160,000 during 2026. Conversely, Stripe is predicted to remain private throughout 2026, the opposite of previous years’ predictions.
2025 Accomplishments Review
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(00:25:50)
  • Key Takeaway: The team executed two MicroConf events, invested in 234 SaaS companies total, and significantly grew the YouTube channel.
  • Summary: The team successfully hosted MicroConf US in New Orleans and MicroConf Europe in Istanbul during 2025. By the end of the year, the host had invested in his 234th SaaS company, combining TinySeed and private investments. The Startups for the Rest of Us YouTube channel surpassed 111,000 subscribers and 6 million total video views.