Author:market participant
Compiled by: Deep Tide TechFlow
Deep Tide Guide: When the new wave of AI agent frenzy triggered by OpenClaw and Claude Code swept through social media, the author keenly sensed a madness reminiscent of the NFT era in 2021.
This article analyzes how social media amplifies technological narratives, how Wall Street engages in indiscriminate selling due to the bias that "AI is killing software," and why giants like Salesforce and ServiceNow were mistakenly punished by the market even after delivering astonishing results.
The author believes we are in the "mid-game" of a great revolution, where extreme optimism and extreme panic are attempts to prematurely透支 (draw on) an endgame that has not yet arrived.
Full Text Below:
This wave of OpenClaw and Claude Code frenzy reminds me of the hysteria of the NFT era.
The emergence of new technology is accompanied by practicality and simultaneously generates cultural and narrative resonance in the zeitgeist. Like every technology that captures the collective imagination at the right moment, it is being processed by the same "distortion machine"—the very machine that once turned JPEG pictures of monkeys into a $40 billion asset class.
The pattern is identical: genuine innovation arrives, early adopters discover real value. Subsequently, the social layer takes over everything—suddenly, the conversation detaches from the technology itself and becomes a performance about "taking sides."
Declaring "This is the future" becomes a badge of the in-crowd. Writing guides, think pieces, and exaggerating the current state's value earns social validation. The compound growth of opinions outpaces the technology itself.
(I promise there will be a point about financial markets later).
The Cognitive Distortion Machine
X (Twitter) makes it worse. Social media is increasingly seen as a legitimate lens on reality, yet it bends the image of truth.
The loudest voices are not representative—they are performing "strong belief" for an audience that rewards such behavior. Every major platform runs on engagement, and engagement rewards extremes. "This is interesting and useful" doesn't go viral; "This changes everything, your job is at risk" does.
A hundred retweets saying "This changes everything" are not a signal, but an echo. Echoes are mistaken for consensus, consensus is mistaken for truth, and truth is mistaken for an investable thesis.
Girard would have a field day with this spectacle. When enough people perform "belief" in a certain outcome, the performance itself becomes confused as evidence supporting that outcome. The NFT era proved this conclusively: people didn't want JPEGs, they wanted "to want what everyone else wanted" [1].
What is Real?
The latest model capabilities are astounding—far more impressive than NFTs, which had little practical utility beyond speculation and cultural signaling.
I use these tools daily. They improve my efficiency in concrete, measurable ways. The underlying models are indeed impressive, and the trajectory of improvement is very steep. When I compare what I could do with these tools six months ago versus today, the incremental gain is massive.
Moreover, the broader potential is limitless. AI-assisted programming, research, analysis, writing—these are not hypothetical use cases; they are happening and creating real value for those who use them well.
I don't want to be the person who scorned the internet in 1998. That's not the point; I am very long-term bullish on AI. The point is the timeline, and the chasm between potential and current reality.
What is Not Yet Real
No—Claude will not immediately catalyze social upheaval. This does not mean humans no longer need interfaces to manage work. This does not mean Anthropic has won the AI war.
Think about what the most breathless opinions actually require you to believe: enterprise software—decades of accumulated workflows, integrations, compliance frameworks, and institutional knowledge—will be replaced in quarters, not years? Per-seat billing models die overnight? Companies with over $10 billion in annual revenue and 80% gross margins evaporate because a chatbot can write a function? [2]
Wedbush's Dan Ives put it bluntly: "Enterprises are not going to tear down hundreds of billions of dollars of past software infrastructure investments to migrate to Anthropic, OpenAI, etc." [3]. And Jensen Huang, who has more reason than anyone to tout AI's disruptive power, called the notion of "AI replacing software" "the most illogical thing in the world" [4].
Those most aggressively declaring "Endgame" (thanks @WillManidis for popularizing the term) are often those who benefit the most from your "conviction": follower counts, consulting gigs, subscription fees, conference invites. The incentive structure rewards bold predictions that bear no responsibility for timing.
The Market's Mirror
What's interesting to me: the market is making the same mistake on the other side of the table.
Anthropic released its Claude Cowork plugin on January 30th. In less than a week, $285 billion evaporated from software, financial services, and asset management stocks [5].
The software ETF—$IGV—is down 22% this year, while the S&P 500 is up. 100 out of 110 components are in the red. The RSI hit 16, its lowest reading since September 2001 [6].
Hedge funds are furiously shorting software stocks and adding to positions [7]. The narrative logic is: AI kills SaaS. Every per-seat software company is a "walking dead."
This selling is indiscriminate. Companies with completely different risk profiles regarding AI impact are being treated as the same trade [8]. When 100 out of 110 names in an index are falling, the market is no longer analyzing; it is indulging in narrative euphoria.
Note: A recovery may have begun since I started writing this.
Throwing Out the Bathwater with the Baby
Look at what's actually happening inside the companies supposedly facing extinction.
Salesforce Agentforce revenue grew 330% year-over-year, reaching an annualized run rate of over $500 million, and generated $12.4 billion in free cash flow. Forward P/E is 15x. They just issued a $60 billion revenue target for FY2030 [9]. This is not a company being disrupted by AI—it's a company building the AI enterprise delivery layer.
ServiceNow subscription revenue grew 21%, operating margin expanded to 31%, and authorized a $5 billion stock buyback. Their AI suite, Now Assist, reached $600 million in Annual Contract Value (ACV), targeting over $1 billion by year-end [10]. Yet its stock is down 50% from its highs.
Should these names see valuation multiples moderately derated due to risk? Perhaps. But smart money started pricing this in years ago. As many smarter than me have pointed out: this selloff requires you to simultaneously believe "AI capex is crashing" AND "AI is powerful enough to destroy the entire software industry" [11]. These two things cannot be true at once. Pick one.
Identifying Real Risk
Will some companies be truly displaced? Yes.
Point solutions offering standardized, single workflows are vulnerable. If your entire product is just an interface layer built on non-owned data, you are in trouble. LegalZoom is down 20%—for these types of companies, the concern has substance [12]. When AI plugins can automate contract review and NDA categorization, the value proposition of paying a legacy vendor for the same functionality becomes hard to defend.
But companies with deep integrations, owned data, and platform-level foundations are a different story entirely. Salesforce is deep in the tech stack of every Fortune 500 company. ServiceNow is the system of record for enterprise IT. Datadog's consumption-based model means more AI compute directly translates to more monitoring revenue—their non-AI business growth actually accelerated to 20% YoY [13].
Selling digital infrastructure because "AI kills software" is as absurd as selling construction equipment stocks because buildings are going up.
We've Been Here Before
The 2022 SaaS crash is instructive. The sector fell over 50%. The median forward revenue multiple dropped from 25x to 7x—below pre-pandemic levels [14]. Earnings performance remained strong throughout. The subsequent rebound was dramatic—the Nasdaq was up 43% in 2023. Admittedly, the trigger then was more an interest rate shock than fundamental deterioration.
The January 2025 DeepSeek panic is more recent. Nvidia plummeted on fears that cheap Chinese AI models would make the entire AI infrastructure buildout pointless, but then fully recovered [15]. That fear was structurally identical to today's: a single product release triggered an existential crisis reassessment of an entire industry.
Many observers have drawn direct analogies between the current moment and the early stages of the dot-com bust—tech stocks falling while consumer staples, utilities, and healthcare rise [16]. But one thing about the dot-com bust: Amazon fell 94%, then became one of the world's most important companies. The market tried to price the "endgame" halfway through the game, creating one of history's greatest buying opportunities.
Deutsche Bank's Jim Reid offered a hard truth: "Identifying the long-term winners and losers at this stage is almost pure guesswork." [17]
I bet he's right. And this uncertainty—the admission that we just don't know how it ends—is why this indiscriminate selling is a mistake.
The Endgame Fallacy
The hype merchants on X and the panic sellers on Wall Street are making the same mistake on opposite ends of the board.
One group says AI has already won, the future is here, all institutions and job functions are to be rewritten from now on. The other group says AI has killed software, subscription revenue is dead, $10 billion in free cash flow doesn't matter because the business model is obsolete.
Both are jumping to the "endgame" while the game still has many moves left. The chasm between our current state and the technological vision will be filled by messy, incremental, company-specific progress. Some software companies will integrate AI and become stronger; a few will actually be displaced; most will adapt—and this process of adaptation is slow, uneven, and not tweetable.
The actual trajectory is more volatile and less certain than either the hype or the panic suggests. Those who will do well from here will be those who can tolerate this ambiguity, not those rushing to grasp a prematurely conclusive narrative.
Great operators always find a way.
Reference Sources
[1] Girard's Mimetic Desire Theory (https://www.iep.utm.edu/girard/)
[2] Fortune: Why SaaS Stocks Are Irrationally Slumping Like During the DeepSeek Panic
[3] CNBC: Impact of AI Tools on SaaS Software Stocks
[4] CNBC: Jensen Huang Says AI Replacing Software is "The Most Illogical Thing"
[5] Yahoo Finance: US Software Sector Loses $285 Billion on Anthropic Impact
[6] Yahoo Finance: IGV ETF Trend Analysis
[7] Axios: Hedge Funds Heavily Shorting Software Sector
[8] Benzinga: Misreading in the Software Sector Crash
[9] Salesforce Investor Relations: Record Q3 Earnings Driven by Agentforce
[10] Futurum Group: ServiceNow Q4 Earnings and AI Platform Momentum [11] Fortune: The AI Paradox and Irrational Analysis
[12] CNBC: Software Stocks Enter Bear Market, ServiceNow et al. Plunge
[13] StockAnalysis: Datadog Operating Stats
[14] Meritech Capital: Review of the 2022 SaaS Crash
[15] CNBC: Nvidia Plunges on DeepSeek Concerns
[16] Fortune: Deutsche Bank on Software Bubble and Internet Era Analogy
[17] Deutsche Bank Jim Reid Analysis Report
