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🤖 AI Transformation: How Intercom's CEO Led a Radical Pivot from SaaS to AI-First

🎯 The Wartime CEO: How Intercom's Radical AI Pivot Saved a Billion-Dollar Company

When your growth hits zero and you're staring at potential decline, what do you do? For Eoghan McCabe, CEO of Intercom, the answer was radical: tear down everything and rebuild as an AI-first company. The result? Finn, their AI agent, is projected to help Intercom become one of the fastest-growing public software companies next year.

In this recent conversation on Lenny’s Pod, McCabe reveals the brutal realities of leading a company through existential transformation. From rewriting company values, to achieving 8-digit ARR with their AI product in record time, this is an interesting tale of decisive leadership during technological disruption.

The stakes couldn't be higher. As McCabe puts it: "You don't have a choice. AI is going to disrupt in the most aggressive, violent ways."

🎥 Watch the full episode here:

📆 Published: 21st August 2025

🕒 Estimated Reading Time: 4 mins. Time saved: 79+ mins! 🔥

🚨 The Crisis: When Success Becomes Stagnation

By 2022, Intercom had all the hallmarks of a successful SaaS company—hundreds of millions in ARR, 14 years of market presence, and a strong brand. But beneath the surface, the company was dying a slow death.

"We had five quarters in a row of sequential decline in net new ARR," McCabe reveals. "We were approaching zero net new ARR." For a company that size, flatlining growth signals existential crisis. The symptoms were classic: feature bloat, unclear strategy, and a team that had lost its edge during McCabe's two-year absence due to health issues from mould toxins and a tick bite.

The wake-up call came when McCabe realised the company ranked "in the 15th percentile for ARR growth" compared to 120+ public B2B software companies. This wasn't just underperformance—it was a company sleepwalking toward irrelevance.

McCabe's return wasn't planned as a permanent move, but pride and urgency drove him back to the CEO chair. "I couldn't bear to see this thing that we built just fade away," he explains. The timing would prove prophetic.

Key Takeaways:

• Even successful companies can drift into mediocrity without focused leadership

• Five consecutive quarters of declining net new ARR is a red flag requiring immediate action

• Founder returns often coincide with inflection points requiring decisive leadership

🤖 The AI Catalyst: Perfect Timing Meets Preparation

Just one month after McCabe's return, ChatGPT launched. The timing was extraordinary, but more importantly, McCabe recognised the threat immediately. "I got whacked across the head by this AI thing. But it also ended up being a gift," he reflects.

While many companies spent months debating AI strategy, Intercom moved with startup speed. Within six weeks of GPT-3.5's release, they had a working prototype of what would become Finn, their AI customer service agent. This wasn't incremental innovation—it was a complete reimagining of their business model.

The decision to pivot wasn't just opportunistic; it was survival-driven. McCabe understood that AI would fundamentally disrupt customer service software, and Intercom could either lead that disruption or become its victim. "We decided to disrupt ourselves before someone else did," he explains.

This represents a masterclass in strategic timing. The company's crisis created the urgency needed for radical change, while AI provided the technological catalyst. Most importantly, McCabe had the founder authority to make unilateral decisions without committee consensus.

Key Takeaways:

• Major technological shifts create opportunities for rapid transformation

• Crisis can be the catalyst needed to make bold strategic pivots

• Speed of execution matters more than perfect planning in emerging markets

• Whatever you think about the pros and cons, “Founder-mode” leadership enables faster decision-making during pivotal moments

🔥 Hardcore Founder Mode: The Art of Brutal Focus

McCabe's approach to the turnaround exemplifies what's now called "hardcore founder mode"—unilateral, decisive action focused on survival and growth. This wasn't consensus-building; it was wartime leadership.

"I rewrote the values designed to be a sharp knife to cut out the parts of the company that I just knew wouldn't be effective," McCabe explains. Values became a filtering mechanism, not feel-good statements. Every decision was evaluated against a simple question: does this help us win?

The transformation required what McCabe calls "wartime company mindset." Resources were reallocated, priorities were ruthlessly clarified, and anything not contributing to the AI pivot was eliminated. "If you're trying to make the shift and it's just not moving, you may need to go hardcore founder mode," he advises.

This approach extended to team composition. McCabe made the difficult decision to part ways with approximately 40% of the team—not through layoffs, but through natural attrition and performance management aligned with new values. "The way that greatness is created is that you find a CEO who's willing to make brave hard decisions and own the results."

Key Takeaways:

• Values should be operational tools, not aspirational statements

• Wartime leadership requires different approaches than peacetime management

• Team composition must align with strategic direction, even if it means difficult departures

• Founder-mode decisions prioritise speed and clarity over consensus

📈 The Finn Phenomenon: Building an 8-Figure AI Product

The results of Intercom's AI pivot speak for themselves. Finn grew from $1M to $12M ARR in its first year—a 1,100% growth rate that puts it among the fastest-growing B2B products ever launched.

But the growth didn't stop there. Finn is currently "growing north of 300%" year-over-year and maintaining "solid mid-80% growth" as it scales. McCabe projects Finn will surpass $100M ARR "in less than three-quarters," making it one of the fastest products to reach that milestone.

The market validation is equally impressive. Finn ranks #1 on G2 in its category and consistently wins head-to-head comparisons with competitors. "We're the largest by customer count and revenue in the category," McCabe notes, highlighting both market share and customer satisfaction.

What makes Finn's success remarkable isn't just the growth rate—it's the speed of market acceptance. Customer service teams, traditionally conservative in technology adoption, embraced AI agents faster than most predicted. This suggests Intercom identified a genuine market inflection point, not just a technology trend.

Key Takeaways:

• AI agents in customer service represent a genuine market disruption, not just hype

• First-mover advantage in AI can create sustainable competitive moats

• Customer validation through ratings and win rates indicates product-market fit

• B2B AI products can achieve consumer-like growth rates when timing aligns with market need

🎯 The Strategic Playbook: Lessons for Founders and Leaders

McCabe's transformation of Intercom offers some interesting learnings for leaders facing similar challenges. The key elements combine strategic clarity, operational focus, and cultural transformation.

First, acknowledge reality brutally. McCabe didn't sugarcoat Intercom's position—15th percentile growth and declining net new ARR demanded immediate action. "We were dead" without change, he admits. This honest assessment created the urgency needed for transformation.

Second, move fast when you identify disruption. The six-week timeline from GPT-3.5 launch to working prototype demonstrates the power of rapid execution. In emerging markets, speed often matters more than perfection.

Third, use values as operational tools. McCabe's "sharp knife" approach to values created clear decision-making criteria. Every initiative, hire, and strategic choice was evaluated against these principles.

Finally, accept that transformation requires difficult decisions. The 40% team turnover wasn't planned, but it was necessary. "Ultimately, greatness requires brave hard decisions," McCabe reflects.

Key Takeaways:

• Honest assessment of competitive position drives urgency for change

• Rapid prototyping beats perfect planning in emerging technology markets

• Values should guide operational decisions, not just cultural aspirations

• Transformation often requires accepting short-term disruption for long-term success

🚀 Getting Started: What This Means for Product Leaders and Founders

For founders considering returns to operational roles, McCabe's experience shows that crisis can create opportunity. His health-driven departure positioned him to see Intercom's problems clearly, while his return coincided with AI's emergence. Sometimes stepping back provides the perspective needed for breakthrough thinking.

For product leaders evaluating AI opportunities, speed of experimentation matters more than comprehensive planning. Intercom's six-week prototype timeline demonstrates that market timing often trumps perfect execution. The companies that win emerging markets are those that ship first and iterate fast.

For executives managing transformation, McCabe's "hardcore founder mode" offers a template for decisive leadership. When consensus-building slows progress, unilateral decision-making becomes necessary. The key is owning the results, both positive and negative and be very aware of the impact you’re going to have on the organisation.

Most importantly, McCabe's story shows that established companies can reinvent themselves, but only with the right leadership, timing, and willingness to make brutal choices.

Key Takeaways:

• Crisis creates the conditions necessary for radical transformation

• Speed of market entry often matters more than perfect product execution

• Established companies can achieve startup-like growth with the right leadership approach

• The biggest risk is often maintaining status quo rather than embracing change

Timestamps

• (00:00) Introduction to Eoghan

• (05:00) The state of Intercom

• (09:53) The decision to pivot to AI

• (12:33) Why Eoghan is "anti-bot" in customer service

• (16:19) Pricing strategy evolution

• (19:26) Implementing the AI transformation

• (26:11) Cultural and organisational changes

• (31:18) Surviving a coup attempt

• (40:05) The future of AI and business

• (45:11) AI's impact on jobs

• (48:44) AI and human creativity

• (50:26) The importance of young AI talent

• (55:00) The cultural shift in AI adoption

• (58:00) Personal growth and leadership

• (01:04:34) Intercom’s success in producing product leaders

• (01:11:05) Intercom’s unique company culture

• (01:14:11) Lightning round and final thoughts

🎥 Watch the full episode here: