AI Agents will dramatically expand the size of the software market. Here's how that will work.  Traditionally, software companies are stuck within the constraints of existing IT budgets, with IT expenses running in most companies somewhere between 3-7% of revenue (with tech and banking often a bit higher). This has always introduced a natural ceiling on the amount of spend for most categories of software. But in an era where the software, because of AI, is *solving* the problem for the customer and not just *enabling* a solution to the problem, the ceiling gets blown up. In an AI-first enterprise, AI Agents will: help marketing teams will spin up campaigns faster in all regions; code and test software for engineering; answer and triage first layer of support tickets; scale outbound campaigns and generate leads; automatically review and work through contracts; and so on. None of these outcomes traditionally came from IT spend. This then directly leads to software TAM growth. Just take a micro example of legal use-cases as an easy case in point. In the US, the contract management and ediscovery software categories are a few billion dollars each, give or take. However, the size of the legal services market in the US is somewhere around $400B, nearly 100X larger than the related software categories. If AI made the legal services operations even 20% more efficient (which is likely an understatement in the medium run), the software spend in this space could very easily grow by 5-10X. You can apply this logic to basically any category of work, and the math is similar. Importantly, the spend is not inherently going to be zero sum with what we spent on before. Net new dollars for AI (not replacing labor) will appear in many areas: startups and small businesses will go after problems they couldn't afford before; teams in large companies can scale out an operation far more than they would've otherwise; and teams that maybe had a business requirement but not enough budget or weren't prioritized before, can now solve a problem more quickly.  Going forward, a company will simply decide how much productivity they want to spin up in the form of AI Agents, and they can just modulate quickly based on the ROI of whatever Agents they're using. Because of this flexibility for scaling out work, the new-use cases it now solves, and the ability to go past the typically limited IT budgets. AI Agents will make software markets much, much larger.