The AI revolution is entering a rather painful phase, with the CapEx-heavy mega-cap tech titans getting sent to the box while various other “disrupted” software firms (most notably the Software-as-a-Service plays) taking even bigger hits to the chin, as investors fear how quickly agentic AI could render formerly moaty tech plays as nothing more than glorified dashboards and siloed databases.
It’s a scary time to be an investor in the software stocks, even if the selling has become a bit overblown at this juncture. This so-called SaaSpocalypse feels like more than just an overreaction on the part of investors, though. The AI revolution might be the real deal, and if that’s the case, perhaps the disrupted will make way for the disruptors, which could be a source of significant gains as the coming years of the AI revolution look to play out.
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The AI revolution is starting to mint some losers as AI disruptors flex their muscles
More recently, markets have been biting their nails over the Citrini research report, which cites a potential grim scenario for AI come 2028. Of course, the future is unknowable, especially given the potential for quick policy changes. However, scenario analyses are intriguing, especially for investors looking to prepare for the worst. While the worst might not happen, it never hurts for investors to have a Plan B. In this piece, we’ll focus on the potential “disruptor” stocks.
Most notably, the frontier model makers. OpenAI, Microsoft (NASDAQ: MSFT) Copilot, Anthropic, and Canada’s own Cohere are among the most enticing AI forces out there. They’re changing the world and are moving markets, especially following the latest and greatest tools delivered by the likes of Anthropic. As agentic AI looks to deliver on profits after years of spend, perhaps investors might wish to consider the big-name foundation model makers as they look to IPO at some point over the 12–18 months. In Canada, Cohere is a name that really stands out.
It’s Canada’s horse in the AI race, and it has been taking on a more efficient path forward, at least compared to the likes of OpenAI, which is spending heavily to keep scaling up. Time will tell if the heavy spend is the best way to go, especially as the market demands ROIs and investors start viciously selling the names that opt to take on more of a spend-first approach. It’s understandable, especially since scaling up is no guarantee of gaining a huge edge in the AI race.
Cohere might win the AI office wars
While Cohere may or may not go public in the next year, I do expect the Canadian AI innovator to be one of the hottest new issues to hit the Canadian market in some number of years. Of course, the appetite for AI stocks has cooled in recent quarters, but, nonetheless, Cohere is a must-watch, especially as Canada looks to make its mark on the AI world.
Like Anthropic, Cohere seems to be going down the enterprise route. Indeed, that’s where the money could be as corporations look to adopt agentic technology and a Citrini-like “human intelligence displacement” scenario were to unfold.
Beyond the enterprise focus and cost efficiency, Cohere’s Aya language model stands out as underrated, especially as Anthropic steals the show with Claude Code, Cowork, and, most recently, Copilot Tasks. Cohere has some great office benchmarks, which, I think, matter most as AI looks to find ROIs. Whether we’re talking about data analysis, coding, or workflow automation, I think enterprise AI is where the opportunity is. And, in that regard, Cohere stands out as a must-watch if it IPOs soon
