The Replatforming of CRM

You’ve heard this before: a company sinks a lot of time and money into their CRM elaborate system (think multiple tools) for storing customer data. A consulting shop promises it’ll be easy (and their retainer is “reasonable”). However, the system still needs dedicated training and administrators who come to resent it with a passion. The data processing is rife with human error. Extracting any meaningful insight requires the patience of a SQL saint. Your reps won’t log in. All the while, shadow spreadsheets and alternative dashboards cannot hide the fact that this system of record is universally despised.

This is the current state of CRM in a nutshell. 

The last decade of technology gave way to the rise of enterprise software. Thousands of unicorns were created across industries, verticals, and geographies—I worked at four of them, including Salesforce. CRM epitomizes enterprise software: sticky, expensive, and hard to replace. 

CRM is often the most critical enterprise app in a company. It’s the largest: according to Gartner, three of the top five enterprise app categories make up CRM (customer support, sales, marketing). It’s also the stickiest: nobody wants to move off their CRM. 

Because of those switching costs, CRM has become dominated by giants. Salesforce has a 20%+ market share in the CRM market. The five closest competitors? Microsoft, Oracle, SAP, Adobe, and Hubspot. Hubspot is the youngest of that bunch and going on their 20th anniversary. 

However, there’s an opportunity today that hasn’t been there in the last 20 years. During my time as an investor, I’ve seen over 50 CRM companies claim that they will unseat the dominant players. But for the first time, AI has ushered in a complete replatforming of CRM, and perhaps of the entire software industry, and we’re excited to invest in it. 

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Why Now

Beyond switching costs, CRM’s resistance to disruption stems from the absence of a clear technological catalyst.

The cloud brought about the disruption of many legacy software industries. It led to the rise of the software giants we know today, including Snowflake, Databricks, Datadog, and Canva, as well as a large percentage of the other 1,000+ unicorns in existence. Salesforce rose to dominate customer relationship data on the back of the cloud. It’s now the stuff of SaaS infamy, when our nimble product marketing team, with the directive from Marc Benioff, hired fake protestors to chant “the end of software is near” at competitor events. These chants and signs weren’t just a rallying cry—they were a promise that enthralled would-be customers.

Today, three shifts have set the stage for a major CRM replatforming and are worthy of their own chants. 

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Shift #1: “Your data lives in a warehouse!” 

Underlying customer data no longer resides primarily in CRMs; instead, it has migrated to warehouses like Snowflake or Amazon Redshift. This diminishes Salesforce’s lock-in advantage, allowing startups to tap into valuable customer data without owning the entire CRM infrastructure. The opportunity now lies in creating integrations and building intelligent applications atop these warehouses rather than competing directly on data storage.

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Shift #2: “Unstructured now! Multi-modal forever!” 

Ask any top salesperson today, and they’ll tell you that the era of manually entering notes or details in a table feels antiquated. Customer data comes in many formats, ranging from emails to Zoom meetings, LinkedIn posts, company news, actual usage metrics, and more. This customer data is increasingly unstructured and multi-modal (audio, visual, interactive), and it should not be the responsibility of people to give it shape in a database. LLMs can accomplish this faster and far more effectively. This is not work that anyone is going to miss. Salespeople who aren’t utilizing AI are falling behind, as the volume of unstructured data is expected to continue increasing.

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Shift #3: “The agents are coming!” 

We’re entering an era where static, database-centric UIs are giving way to flexible, agentic interactions. The AI-driven CRM isn’t about managing data—it’s about automating workflows, contextualizing information, and automating routine processes.

Intelligent agents will redefine CRM interactions:

• Automated account research: Sellers automatically receive synthesized customer insights and contextual data before every interaction.
• Meeting assistants: AI joins meetings, tracks discussions, identifies next steps, and updates records in real-time.
• Action recommendations: AI proactively suggests sales strategies based on integrated external and internal data, significantly reducing manual effort.

Emerging standards like MCP and A2A help catalyze agentic adoption even further. We are so close to a future where there is an MCP server for every type of critical enterprise data and tool. Just as the rise of APIs in the cloud has enabled a new wave of technological feats, this will also facilitate a new era of innovation. These actions of these agents will be proactive and automate tasks that were once manual, dull, and painful. 

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The Best Wedge: Enhancing Existing Customer Relationships

Enterprise sales today are less about hunting new clients and more about cultivating existing relationships. According to HubSpot, approximately 72% of new revenue originates from current customers.

AI-native startups are already capitalizing on this fact, embedding themselves deeply within existing customer-centric workflows and capturing valuable usage data to further refine their offerings. 

Once companies have access to unique data, they can provide a contextualization layer on all of a seller’s accounts, taking advantage of LLMs biggest strength today. Sales reps shouldn’t have to spend time researching their accounts; instead, they should automatically receive briefing materials before meetings and clearly defined follow-up actions afterward.

What if your CRM could think for you? For the first time, it can.

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From Augmented to Automated Sales

While the best wedge focuses on enhancing existing relationships, the real opportunity lies in automating administrative work for sellers. 

Consider that sales representatives spend less than 30% of their time actively selling; the remainder is consumed by administration, research, qualification, and CRM maintenance. AI agents can automate these burdensome tasks, freeing salespeople to focus on what they do best—building authentic relationships and driving revenue.

Ultimately, we foresee AI-driven CRM transforming the nature of sales roles. Rather than replacing humans, these technologies amplify the capabilities of the most productive salespeople. If the top 10% of sellers currently account for 65% of sales revenue, AI has the potential to exponentially scale this even further, power-lawing top performers even more.

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The Challenge

The conditions for CRM disruption have never been clearer. The companies that succeed will:

• Create simple but powerful workflow builders that reps can learn quickly.
• Integrate AI with rich, existing customer data sources (whether a CRM or data lake) and capture new data effortlessly (a customer call). 
• Offer immediate ROI through measurable workflow automation.
• Utilize AI to provide accurate customer sentiment analysis for the first time.

It’s challenging to predict the outcome of this replatforming. Will one or two new large agentic CRMs dominate most use cases, or will there be an unbundling that creates multiple players for specific industries? Regardless, we know that a large market is waiting to be tapped in this space.

The timing for replatforming is now. There are only two to three years for someone to come along and build the premier agentic experience that displaces CRM in the hearts of every revenue team. This opportunity exists for now because existing players don’t want to curtail their rich revenue streams, and they struggle to innovate the way startups can. 

This window for disruption—20 years in the making—won't remain open forever. Only the boldest founders who act decisively now will seize this historic moment to transform how businesses connect with customers forever.

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^{Thanks to Tobi Coker and Eric Flaningam for contributing their thoughts and research to this post.}