TLDR Tech / Founders
Your AI Feature Is Quietly Destroying Your Gross Margin
AI needs to be treated like traditional SaaS COGS. The classic SaaS model was built on high gross margins and low marginal costs. However, add AI inference costs, model-routing costs, vector database costs, and other AI infrastructure, and that margin profile can change fast. AI can create a better product, but it can also quietly pressure the most important leverage point in the SaaS financial model. Businesses need to learn to isolate that pressure in their SaaS P&L, otherwise they will feel it everywhere.
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