Internal software development is undergoing a quiet revolution. For decades, the promise of non-technical teams building their own tools was out of reach, limited by technical barriers, scalability concerns, and fragmented workflows. But generative AI is transforming that equation, collapsing the gap between idea and execution. Today, product managers, operations leads, and even designers are prototyping fully functional internal apps using natural language. This shift isn’t just about better prototyping, it’s accelerating iteration and expanding ownership across organizations. Here’s how we got here, and why the next era of internal tooling is arriving sooner than expected.
Companies have always needed internal software dashboards, workflows, and databases that power operations behind the scenes. For decades, non-engineers tried to fill the gap with tools like Lotus Notes, Excel macros, and Access forms. But most of these self-built solutions turned into fragile prototypes that were hard to maintain and scale.
By the 2010s, pressure for better internal tooling had intensified. The proliferation of cloud and SaaS software scattered data across platforms, creating constant context switching and operational drag. Engineering time became increasingly scarce, and digital transformation efforts pushed even traditional industries to automate manual work. Off-the-shelf tools helped, but they often fell short when it came to integration depth, custom logic, or speed.
In response, a new mindset took hold: internal software was no longer nice to have; it became a foundational part of running a modern organization. Facebook became a well known example, investing heavily in internal dashboards, developer tools, and deployment systems to move faster and operate more effectively. But few companies had the resources to build this kind of infrastructure in-house. That gap created a clear opportunity: if internal tooling was essential but out of reach for most, new platforms could bring those capabilities to the rest of the world.
By the mid 2010s, as reliance on internal tools deepened across industries, the limitations of spreadsheets, ad hoc scripts, and siloed workflows became increasingly obvious. This unmet need gave rise to a new generation of platforms built to make internal software easier to create, maintain, and scale without requiring full engineering teams.
Two major players emerged with distinct approaches: Retool, which streamlined internal app development for engineers by removing boilerplate and UI plumbing, and Zapier, which enabled non-technical users to automate workflows and connect SaaS tools through a no-code interface.
These are the most prominent use cases for internal tools that companies build, the teams that build the most internal tools, and the teams that dedicate a person to maintain the tools:
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Over time, both platforms expanded: Retool added hosted databases and templates; Zapier introduced front-end and storage capabilities. But despite traction, this first generation of tools had real limitations.
Despite major progress, today’s internal tooling platforms still face fundamental challenges:
Internal tools have long been plagued by tradeoffs: organizations could either allocate scarce engineering resources or settle for the rigid limitations of traditional low-code platforms. But with the rise of generative AI — particularly since 2023 — a new possibility has emerged: what if anyone could build a working app by simply describing what they want?
That promise is starting to materialize. A wave of gen AI-native platforms like Lovable, Replit, Vercel v0, Figma Make, and Bolt have made it possible for users to create working prototypes and lightweight apps directly from natural language. Instead of manipulating components in a drag-and-drop builder, users now prompt AI agents that can generate UI, write logic, spin up databases, and even handle deployment.
While much of the output today is still prototypical — designed for internal validation, low-traffic usage, or throwaway testing — the direction is clear. If the current momentum continues, these platforms may soon serve as the foundation for fully deployable, production-grade internal applications.
The early indicators are promising:
The biggest impact we’ve seen from AI-native app builders — compared to the previous generation of tooling — comes from three advances: natural language interfaces, the ability to build and iterate rapidly, and greater flexibility and customization.
Of these, natural language interaction is key. It has unlocked a new profile of users, enabling non-technical business users (vs. more technical personas) to be able to take on more of the app building and maintenance workflow themselves.
Use of gen AI platforms is growing across teams, particularly within design, product, and strategy functions. Here’s what’s happening on the ground:
While many organizations initially picked up vibe coding tools like Lovable, v0, and Replit for prototyping, they’ve increasingly started to use them for internal tooling.
However, the requirements for internal tools differ from those for prototyping. While building internal tools, organizations primarily care about functionalities around:
Meanwhile, users who rely on app-building tools for prototyping prioritize a different set of features. They place greater emphasis on UI/design, flexibility, and the ability to iterate quickly — and less about security, governance, and integration concerns.
Despite the early limitations, the shift underway is hard to ignore. Gen AI tools are not yet replacing internal software teams, but they’re already reshaping how internal software is scoped, tested, and socialized.
As these tools evolve toward deeper integrations, improved governance, and easier collaboration, they may move beyond prototyping engines to become the foundation for building and maintaining real internal apps.
Some gen AI companies have already begun hiring Internally Deployed Engineers — roles wholly dedicated to improving internal workflows using these tools.
The shift would mean:
If the first generation of no-code tools promised accessibility, this next generation is aiming for acceleration. These apps may start as prototypes, but they may not stay that way for long.
Gabriel Vasquez is an investment partner at Andreessen Horowitz, where he focuses on enterprise and fintech investments in the U.S. and Latin America.
Stephenie Zhang is a partner on the Growth investing team, focused on enterprise technology companies.
Yoko Li is a partner at Andreessen Horowitz, where she focuses on enterprise and infrastructure.