Short answer: Jordan Metzner says incumbents have been slow to add AI, so customers build on top of them, and new customer acquisition is where they get squeezed. He says Anthropic converting COBOL code shows how fast competition is coming.
Watch this answer from Episode 33 (starts at 20:45) · Episode 33 notes and transcript
From Episode 33: AI Is Transforming Construction — We’re Entering a Golden Era, starting at 20:45.
Jordan Metzner [20:44]: Yeah. So I think I'm probably in a pretty similar camp. I think, you talk about these incumbents, whether it's SAP or Salesforce or, some of the other ERP solutions, obviously, they've been terribly slow at implementing AI on top of their platform. So you have this natural behavior happening, pretty organically, which is companies are saying, hey, we're relying on these massive, systems of record, whether that's Workday or SAP or whatnot, you know. And we're hoping that they implement AI because, it will make our lives better, it'll make our job easier, it'll help us manage our company better. But the companies aren't delivering on those promises or certainly not delivering on those products. And at the same time, while those companies are getting pressure from their investors, their clients are getting pressure. Right? What are you guys doing with AI? Right? And so, over the last probably few months, we've seen a lot of people start to kind of build on top of. Right? Like kind of, hey, just leave it where it is. Let's take out all the data we can, and let's go build on top of it with AI. Now, obviously, in this natural organic behavior, at the same time, obviously, the sales forces and the SAPs are trying to build AI to deliver a valuable product.
Jordan Metzner [21:51]: And there's always and I think this is probably where they're getting hit the most, is probably on new customer acquisition. Right? I mean, who really is a large company today that say, oh, let's sign up for Salesforce today? Like, need to sign up right now, like, right this minute. Right? And I think that's probably where they're really getting squeezed because, if you have a large enterprise and you're sitting on top of Salesforce as like your central CRM for your company, I mean, your ability to move off of Salesforce quickly is probably pretty difficult. Now, building your own like vibe coded CRM may be possible in a short term or for a small type of company, but if you're a large enterprise, you have thousands of seats or something like that, it's probably not so easy to pivot off of Salesforce, that quickly. It's probably easier to extract data from Salesforce, build some AI on top, build like a mini tool. Right? And I think everybody's hoping, at least some of their clients are hoping, that there's a backfill here where AI comes in and says, hey, don't worry, you don't need to build all these tools on top, we're gonna come and solve your problem for you.
Jordan Metzner [22:48]: Now, if you look at a company like Google, I think, probably six, eight months ago, we were talking about Bard, and how bad their product was, and how they're a loser in the race, yada. And now, we're pretty much talking about Google kind of in the number three spot from a foundational model perspective, with the probability or optionality to get into the second or first spot. Right? And you know, high-tech companies like Google, we're seeing doing a great job of implementing AI to the point that, what will be the impact on, Google's, work suite, for example, and how will that have a negative impact on Microsoft's work suite, for example. I saw yesterday that Salesforce announced a deal with Anthropic, but, I mean, Anthropic is both, their friend and their enemy at the same time. Right? And, these companies that own these foundational models, whether that's OpenAI or Anthropic or Google, obviously have this unique competitive advantage where they can go build their own SAP or their own CRM, and, maybe they can even build adapters to do that. And I think the news I don't know if we shared the article, but it was something about, figured out a way to write COBOL code and transfer it into new modern language and look what that impact is on IBM. Right? And so, these kind of more antiquated players, their competition is coming at them faster than they ever thought.
Jordan Metzner [24:04]: I don't think IBM thought they were like in this unique space where who the hell wants to manage, kinda COBOL software development. But, then, Anthropic let their models run automatically over the weekend and come back with a, COBOL, transformer, and boom, maybe banks are starting to migrate off of COBOL because now they can buy this transformer software. So, it is like a moving target, it seems like. I would say that, like, some of these large major companies have an opportunity, but that opportunity is fleeting, especially if they're not able to continue to acquire new customers at the same rate they were historically. And what would be the impact of that. I think like, there's such an opportunity for Salesforce to just be an AI focused company that ends up becoming a huge player in the space, but it's also looks like it's more possible, if not more probable, that they actually end up losing here because they're not able to implement AI fast enough within their software and their organization.
