12.11 — The SaaS industry, ARR fraud, the con#
Ocarina rejects SaaS. The SaaS industry is a circular ecosystem where every tool sells to every other tool, where declared revenue is inflated by convention, and where every layer of the capital chain (LP, VC, founder) deliberately maintains a plausible deniability so as to sue the others when the time comes.
1. Contemporary SaaS#
| Layer | Providers (sample) | Model |
|---|---|---|
| Hosting & CDN | Vercel, Netlify, Cloudflare, Fly.io, Render | Subscription per project / per bandwidth |
| DB | Supabase, Neon, PlanetScale, Upstash, MongoDB Atlas | Subscription per compute / per GB |
| Auth | Clerk, Auth0, WorkOS, Stytch | Subscription per MAU |
| Resend, SendGrid, Postmark, Mailgun | Subscription per sent email | |
| Analytics | PostHog, Mixpanel, Amplitude, Plausible, Vercel Analytics | Subscription per event |
| Error tracking | Sentry, BugSnag, Rollbar, Highlight | Subscription per event |
| Observability | Datadog, New Relic, Honeycomb, Grafana Cloud, Axiom | Subscription per metric volume |
| Feature flags | LaunchDarkly, GrowthBook, Statsig, ConfigCat | Subscription per MAU |
| E2E test | BrowserStack, Sauce Labs, LambdaTest, Cypress Dashboard | Subscription per run / per parallel |
| CI | GitHub Actions, CircleCI, Buildkite, Vercel CI | Subscription per minute |
| Code review | Graphite, Codeball, CodeRabbit, Sourcery | Subscription per PR / per dev |
| Internal comms | Slack, Linear, Notion, Figma, Loom, Pitch | Subscription per seat |
| Billing | Stripe, Lago, Orb, Metronome | % of processed revenue |
| CRM | HubSpot, Salesforce, Attio, Pipedrive | Subscription per seat |
| Support | Intercom, Zendesk, Plain, Help Scout | Subscription per seat + per message |
| AI tooling | OpenAI, Anthropic, Cursor, Vercel AI SDK, Replicate | Subscription per token + per seat |
2. Cross-subscriptions#
┌──────────┐ pays ┌──────────┐
│ Vercel │─────────>│ Stripe │
│ │<─────────│ │
└──────────┘ pays └──────────┘
│ │
pays │ │ pays
v v
┌──────────┐ ┌──────────┐
│ Linear │<────────>│ Notion │
└──────────┘ pay └──────────┘
│ │
v v
┌───────────────────────────────┐
│ Slack, Figma, Loom, Sentry, │
│ Datadog, Clerk, Cursor, … │
│ all subscribed to all │
└───────────────────────────────┘- Vercel pays a subscription to Stripe (billing), Datadog (obs), Linear (planning), Figma (design), Loom (internal presentations), Slack (comms), Notion (docs).
- Stripe pays a subscription to Vercel (hosting for its dashboards), Linear, Figma, Slack…
- Linear pays a subscription to Vercel, Stripe, Notion, Figma, Slack.
- Notion pays a subscription to Linear, Stripe, Slack, Figma.
And so on. Everyone pays everyone.