AI Coding: $12M return for $240K spend?

This is an email I sent to our leadership team a few minutes ago.

We may be witnessing the third major leap in computing productivity, after high-level languages in the 1960s and spreadsheets in the 1980s

In the last few weeks, AI coding really took off. CursorCodyReplit Agents are FAR better than GitHub Copilot.

Research on ~5,000 devs in Fortune 100 shows that even GitHub Copilot makes them ~25% more productive.

Personally, Cursor helped me:

1. Write faster code (at least 2X). I’ve given away my team (there’s not enough work for them).

2. Write better code. I now document code for others to replicate – because it’s so easy.

3. Write complex code. I’ve built stuff I didn’t know how to. WhatsApp agents, AI code writers, even LLM Foundry. Each has opened a client’s door.

So, should we leverage AI Coding for our developers?

Maybe not. Consider these risks.

1. It costs $10-$20/month/dev. That’s $120-$240K/year for ~1,000 devs.

2. Clients may not be comfortable with us using AI coding. IP. Security.

3. Higher productivity reduces our T&M billing, hence revenue.

Maybe yes. Consider these benefits.

1. We could save 25% per developer. Maybe $4K/month/dev x 25% = $12M/year

2. We could win more complex engagements. (Pitching AI coding as an edge has worked well, too.)

3. We could reduce time to get someone to a tech-lead level.

There’s probably no one-size-fits-all answer. We might need to pilot while we strategize.

How might this impact our hiring and training?

1. Hire for AI coding skills. In interviews, I’d look for use of AI coding agents. We need a few AI coding leads to share our engineering future.

2. Hire for dual skills. AI can take care of the code. I’d hire people with good client-facing skills.

3. Train on AI coding. Integrate these into the onboarding process. Train existing devs.

4. Train non-developers. Analysts, designers, managers can become as good as junior devs.

Why am I mailing you?

In Nov 2022, when ChatGPT was released, I thought LLMs were the biggest knowledge leap since Google.

In Sep 2024, with Cursor, Cody, and Replit agents, I think AI coding the biggest productivity leap since Excel.

This is not for immediate action.

Please think over it. Share it. Discuss it. Pilot it. Let’s explore.

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