Can’t You Just Do It All?

The dream of infinite scalability and low marginal costs has long captured the imagination of entrepreneurs and investors alike. SaaS products, after all, promise easy integration and limitless growth potential, often with little to no human intervention. However, as companies scale and their products become embedded in real-world workflows, the initial dream gives way to reality: customers don’t just want tools, they want results. And increasingly, they ask, “Why can’t you just do it all?”

For months, we’ve been trading notes—from both sides of the founder-investor table—on a shift we believe is reshaping the software landscape. As AI advances, it’s unlocking a new generation of outcome-based models, where companies deliver results, not just tools. 

While the idea of outcome-based models isn’t new (leading voices in venture capital at Emergence and General Catalyst have already hypothesized that this is the future of SaaS), we believe it is quietly entering a more durable and scalable phase that represents the next enduring moat in tech. 

In this article, we’ll explore this shift from a bottom-up perspective, shedding light on what we see as the earliest stages of a model focused on selling the work, not just the tools.

The case for outcome-based pricing models: An investor perspective

“Service business with software-like margins” has long been a Silicon Valley trope. And for good reason. The prior generation of software companies was largely unsuccessful in realizing that promise. Namely, because the technology (i.e., AI) did not yet exist to make it a reality.

We believe the opportunity here is far larger than traditional SaaS. While the U.S. software market has a few hundred billion in revenue, service sectors that AI can transform, such as legal, accounting, and customer support, among others, represent trillions in spend. Outcome-based models don’t just change how software is sold; they also expand the addressable market by going after the 90%+ of spend that’s still tied to people, not tools.

Historically, shifting to outcome-based pricing models meant adding headcount to achieve one-to-one customer guidance and support. This approach resulted in lower gross margins (30-40%), in stark contrast to the 80-90% margins that pure software businesses enjoyed. The stigma around service-based models and their lower margins discouraged many founders from pursuing them, fearing it would hurt their appeal to investors and affect their valuations. Now, thanks to AI, this guidance and support can be delivered at a dramatically lower cost, and with far higher margins.

While early-stage SaaS adoption may seem straightforward, customers increasingly demand not just implementation but also execution with minimal errors to achieve compounded value over time. Investors now recognize that outcome-based pricing creates greater customer alignment and drives more stickiness than traditional seat-based models. 

Many founders already intuitively know this to be true

At daydream, we decided early on that we’d offer hands-on support to our customers until our product was refined. Once we reached mass market readiness, we’d transition our model to match the pure SaaS investment thesis. However, when our product reached its ideal state and we put the two pricing models next to each other, we faltered because the service-based approach generated 3 to 4 times more revenue than the model without it.

We recognized that our customers would much rather have SEO done for them than learn to use our platform themselves, and they were willing to pay a much higher premium. For example, SEO tools like Semrush charge $10-20K annually, while SEO agencies charge upwards of $300K annually. Ultimately, the tools alone could only handle a small fraction (3-4%) of what’s needed to achieve successful outcomes. The rest — the complex strategy, content creation, and ongoing iterations — required specialized expertise. 

This led daydream to rethink its business model. If the tools alone couldn’t deliver the full outcome, then why not deliver the whole package? This is where our business thesis came to life. Artificial intelligence can enable a huge throughput improvement on the existing default for SEO success (traditional agency + SaaS tooling), and customers can get results in a fraction of the time they would traditionally expect. 

The process is the new product 

While automation and AI tools currently exist for almost every step of a service-based offering, we believe it’s ultimately the continuous looping and execution of these steps with minimal errors that creates value over time. Mastering the process cannot be easily replicated, even if you provide all the step-level tools. 

The only way to master the process is to create consistent, airtight systems that accompany the software. By codifying these systems into repeatable frameworks for specific verticals, businesses can establish competitive moats. 

This isn’t a detour from scalability. Because once you’ve built the process, refined it, and proven it works, you can productize it and scale it without breaking it. 

Send in the experts, then send in the code

This is where companies are borrowing from Palantir’s “forward-deployed” model—embedding engineers directly into customer workflows to build customized solutions and ironclad playbooks that ensure the software delivers maximum value.

At daydream, our "Growth Leads" function in a similar capacity. These experts work alongside our customers to help them fully leverage our platform while also providing expert guidance on broader SEO strategy and implementation. This deep partnership ensures that daydream’s tooling meets the specific needs of each customer and drives successful outcomes.

Our Growth Leads produce outstanding results while saving 90% of their time on the most complex parts of SEO, allowing them to serve more customers. This lets us operate at a level that traditional agencies can’t match. Whereas a typical agency needs 3 to 4 people to manage 3 to 4 customers, daydream Growth Leads produce outlier results while maintaining a drastically higher level of efficiency. 

The first movers in the outcome era

General Catalyst recently analyzed 70+ industries to identify where applied AI could automate 30-70% of the hours spent on repetitive, manual workflows that take up practitioners’ time. Their analysis found that customer support, accounting, legal services, IT services, insurance, and property management were some of the industries well primed for AI rollups. 

AI permeating traditionally labor-intensive industries changes how they operate in a way that is a win-win for both employees and customers. Employees benefit through the automation of rote tasks, freeing them up for creative and strategic work, while customers benefit from better service through greater capacity, faster turnarounds, and a lower price. We at GC are already partnering with early leaders in this movement, including Crescendo, Long Lake, and others. These aren’t just sectors theoretically ripe for disruption; they’re where capital is flowing, talent is gathering, and the next generation of global category leaders is being built. 

We’re at the end of the era where software companies hand customers the keys and walk away

The shift from tools to outcomes doesn’t mean abandoning the core advantages of SaaS — scalability, efficiency, and high margins. Instead, we think it means evolving those advantages by pairing software with tightly defined, repeatable processes that ensure results. 

For companies like daydream, this has meant becoming a full-service partner, combining AI-powered tools that automate high-friction steps with proprietary systems designed to deliver one final outcome: Maximizing the chances of success with SEO in the first year. 

This hybrid model isn’t a step backward. We believe it’s the next stage of SaaS. One where software doesn’t just sit idle waiting to be used, but is actively deployed through a system that guarantees impact. As more companies realize the limits of tooling alone, those who can wrap software in a proven process will be the ones to build enduring moats, stronger customer loyalty, and better business outcomes.

Disclaimer: This article is for informational purposes only and does not constitute investment advice. daydream is not a portfolio company of General Catalyst. Any views expressed here are solely those of the authors and not influenced by any investment relationship.