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What will 2026 bring? Here are a few thoughts!
Liquidity & Funding: What’s Really Ahead
Let’s start with the funding landscape. 2026 will see the startup fundraising landscape relatively flat to 2025, which means for most founders and funds it will continue to be difficult to raise capital. If/when AI cools off as a “hot category” we will see valuation averages drop off as outliers fade (think the $400M pre-venue AI valuations) — similar to what we saw from the impact on alt protein several years ago.
All signs point to continued macro uncertainty, fortunately early stage companies tend to have negligible impact from this but the impacts will eventually trickle down but not in 2026.
There are early signs of an improved liquidity market with a small surge in late 2025 IPOs and ones that are just ahead (Anthropic?). Two other good indications are the uptick in M&A and falling interest rate environment, both of which will contribute to increased liquidity. From what we can tell there is growing pent up demand on both sides of the M&A market. This is hard to put a number against or judge versus previous periods but it seems to be the undercurrent of the moment.. Keep in mind — liquidity today doesn’t have an immediate tangible impact on institutional funding of early stage startups as that capital needs to go through another cycle before it will meaningfully move seed fundraising.
The 2026 Startup Team: Back to Hubs, Powered by AI
For several years, we have heard from startup founders that their teams would always be fully remote. 2025 brought a shift. We expect this to continue into 2026 where the move back to in person, or at the very least a hub-and-spoke model will prevail for early stage companies. In other words, startups will decide on specific cities to focus hiring efforts on to create clusters for different parts of the teams.
Also on the team front, adoption of AI efficiency tools will continue to enable higher ratios of revenue per employee. Said more simply, startups can get bigger without needing to hire as many people. The roles getting cut first tend to be more junior which will create a longer term challenge, in that fewer junior roles mean that there are fewer traditional upskilling paths. A problem for another day? Maybe an entrepreneur will figure out a solution.
Where Food Tech, Health Tech, and SaaS Are Headed
Vertical AI is the new Vertical SaaS. Like most other VC’s we have leaned in heavily here and plan to continue to do so in 2026. Perhaps a bit more counterintuitive prediction is that heavy services and brick-and-mortar categories will become more valuable with the proliferation of AI. Physical experiences and customer service will continue to matter more as consumers and businesses will crave the trust and human interaction it brings.
When it comes to technology across the food, we expect to see manufacturing and supply chain tech remain attractive (think companies like FirstShift and Tradeverifyd). Unlike past tech trends, we’ll see rapid adoption of AI by large companies across the food supply chain. Much as we mentioned in our SaaS specific overview, we believe human touch will remain central to this sector — food is about emotion, community and experience.
In healthcare, we’ll see a continued increase in cost of care and continued lowering of reimbursements, creating a difficult math equation for the industry. Enterprise players will lean on AI for everything from operational infrastructure to clinical decision support to care delivery as they look for ways to balance that equation. We’ll also be tracking the landscape around pharmaceutical costs, especially GLP-1 and cardio-metabolic medications.
2026 won’t solve every challenge, but it will create more space for founders to move. As liquidity improves and adoption accelerates across industries, the companies executing well will pull ahead.