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Forget SaaS. YC's New Bet is Service-as-a-Software — And We're All In.

Thomas McDonough

Product & Engineering

5 min read

February 5, 2026

Forget SaaS. YC's New Bet is Service-as-a-Software — And We're All In.

Y Combinator recently released their Request for Startups, and one category stood out: Service-as-a-Software.

In his post on AI-Native Agencies, Aaron captures the moment perfectly:

"Agencies have always been crazy hard to scale... But AI changes this. Now instead of selling software to customers to help them do the work, you can charge way more by using the software yourself and selling them the finished product."

This resonates because it solves a specific friction point we see every day with early-stage founders. The traditional agency model—high retainers, long onboarding, and manual execution—often struggles to align with the agile, chaotic reality of a pre-Product Market Fit startup.

At Growthmind, we are building a living case study of this thesis. We aren't trying to just "build tools"; we are reimagining how growth strategy is delivered by turning the service itself into software.

The Challenge: High-Touch vs. High-Scale

For a traditional agency to be profitable, they need long-term contracts and standardized processes. But pre-PMF startups need the opposite: they need rapid experimentation, constant pivoting, and ruthless auditing of their business model.

This mismatch often leads to the "Efficiency Trap":

  1. Discovery takes too long: Humans need weeks to absorb a new industry context.
  2. Strategy is static: A 40-page PDF is obsolete the moment a customer interview changes the roadmap.
  3. Feedback loops are slow: Waiting a month to see if a channel works is fatal for a startup with limited runway.

The "Service-as-a-Software" model allows us to break this triangle. By encoding the expertise of a senior growth strategist into an AI architecture, we can deliver the outcome of an agency without the friction of the traditional model.

Putting the Thesis into Practice

So, what does an AI-Native Agency actually look like in the growth vertical? For us, it means moving from "consulting" to "computation."

1. Instant Context & Diagnosis

Instead of a month-long discovery phase, an AI-native approach allows for immediate immersion. Growthmind acts as an always-on auditor. It digests the founder's idea, market data, and positioning instantly.

It doesn't just ask "what are your goals?"; it interrogates the business model against thousands of data points to identify gaps in the value proposition before a single dollar is spent on ads.

2. Dynamic Strategy

In the old model, strategy was a deliverable. In the Service-as-a-Software model, strategy is a continuous process.

Because the "agent" is software, it can pivot instantly based on new data. If a customer interview reveals a new pain point, the entire growth roadmap updates in real-time. It moves the founder from "activity" (doing things) to "clarity" (doing the right things).

3. Execution as Code

The ultimate promise of the YC thesis is that the software "does the work."

For Growthmind, this means automating the validation loop. We don't just recommend an experiment; the system is designed to draft the outreach, build the landing page copy, and set up the tracking. It turns the "advice" layer into the "execution" layer.

The Future: Founder + AI Team

We believe Aaron is right: the agencies of the future will look like software companies.

For the early-stage founder, this is a massive unlock. It means access to high-fidelity growth strategy and execution that was previously reserved for Series B companies with large marketing teams.

We are excited to be building in this new category, helping founders navigate the messy path to product-market fit with the precision of software and the strategic depth of a partner.


P.S. Applying to YC?

We built a free tool to help you stress-test your application before you submit. It acts as an AI partner to simulate the YC interview process and refine your answers.

Try the Shortcut to Getting on YC →

Thomas McDonough

Product & Engineering at Growthmind

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