This time each year, I eagerly anticipate my “World Tour” in APAC and EMEA, where I have the opportunity to spend time with G2 employees, customers, partners, and other SaaS leaders and entrepreneurs. Reflecting on the conversations that took place at our G2 Live and Midyear Meetup events in Bangalore, as well as SaaStock in Dublin, I remain optimistic about the global growth of software and the role AI will play in accelerating that growth.
The B2B software landscape is continuing to expand, with leaders emerging from all over the world. Despite the current economic climate, software remains a promising avenue for growth on a global scale. Over the past five years, the number of software listings on G2’s marketplace has grown by 7%. This positive trend represents a worldwide opportunity. While 74% of G2 Leaders are based in the Americas, 17% come from countries in EMEA, and 9% originate from the APAC region. Buyers are becoming less focused on specific regions and are instead seeking out the best software solutions created by entrepreneurs from any part of the globe.
Although venture funding and dealmaking have slowed down overall, I have observed positive indicators in the regions I have visited. In India, for example, $7.6 billion has been invested across 977 deals so far this year, with the total deal value increasing over the past two consecutive quarters. Additionally, it has been predicted that Indian SaaS centaurs and unicorns will generate over $20 billion in revenue by 2023. EMEA also shows promising signs of growth. The recently released 2023 Accel Euroscape report states that $31 billion has been invested in private cloud companies year-to-date, bringing Europe, Israel, and the US back to pre-COVID investment levels. The European and Israeli cloud ecosystems have strengthened their relative positions, now accounting for 53% of the US market compared to 46% in 2020. Year-to-date, the Euroscape has seen a 29% increase. All of these indicators point to a forthcoming recovery and a ripe growth opportunity for SaaS innovators worldwide.
The rise of AI is closely aligned with this growth opportunity. We have already witnessed the shift in B2B software buying towards a more consumer-like shopping experience. In fact, 67% of global B2B software buyers say they typically engage with a salesperson from a software company only after they have made a purchasing decision. Now, with the advent of AI, we are witnessing an acceleration in software innovation and a shift towards digital buying. OpenAI’s ChatGPT has ushered in a new era in software, akin to the launch of the visual internet and the iPhone. At G2, we have embraced this trend with Monty – the first-ever software buying assistant designed to streamline the process of finding the best software for a buyer’s specific business needs.
We are also seeing SaaS vendors racing to release new AI software solutions, with 643 new products added to AI categories on G2 in the past year alone, making AI the fastest-growing software market with a 39% year-on-year growth. Accel reports that while the majority of generative funding has gone to US companies, there are numerous promising generative AI companies emerging in Europe and Israel, collectively raising $7.6 billion. Software buyer behavior is rapidly changing as well, as AI capabilities are now expected. According to G2’s 2023 Software Buyer Behavior Report, 81% of global buyers believe it is important for the software they purchase to have AI functionality, and 78% trust the accuracy and reliability of AI-powered solutions. India, in particular, leads the world in AI adoption and trust, with 78% of Indian respondents in a global survey stating that they currently use AI at work. This trust can be attributed to APAC SaaS entrepreneurs who are spearheading AI innovation due to the region’s exceptional data science and AI talent.
AI has solidified itself as the ultimate growth wave for SaaS innovators. Even in the face of challenging economic conditions and funding slowdowns, the SaaS landscape across APAC, EMEA, and the Americas remains resilient. By embracing smart organic growth, continuing to innovate with AI, and adapting to evolving buying behaviors, SaaS innovators will be able to accelerate growth in the years to come.
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