Each year, we ask top investors what they think the next year will bring. Last year, some investors thought the IPO market would be back up and running by now, which did not happen, while others correctly predicted the acceleration of AI momentum. This year, TechCrunch spoke with five investors from various markets about what they are preparing for in 2026. Here is what they said.
What will it take for a founder to raise next year, compared to last year?
James Norman, Managing Partner at Black Ops VC, says raising in 2025 requires a shift from visionary to battle-tested. In previous years, capital was a primary moat. Now, investors are wary of pilot purgatory, where enterprises test AI solutions without an urgent need to buy. In 2026, the bar is rising. Founders must prove to VCs they have more than just traction; they need a distribution advantage. Investors are digging deeper into repeatable sales engines, proprietary workflows, and deep subject matter expertise that holds up against the capital arms race. VCs no longer care about who is first to market with a flashy demo. They want to know who is building something that can last, earn trust, and scale long-term.
Morgan Blumberg, Principal at M13, believes funding markets will always be available for the best founders, but the bar will rise. At the earliest stages, especially in AI application software, she expects fewer mega seed rounds given intense competition and capital already deployed. Founders will need to stand out with unique distribution channels or perspectives, not just by relying on a large market opportunity and strong backgrounds. Capital moats have already formed around crowded sectors. At the Series-A and B stages, top-quartile rounds will require clear evidence of explosive momentum. The market has adjusted with increased scrutiny on the sustainability of revenue.
Allen Taylor, Managing Partner at Endeavor Catalyst, states the requirements are bigger, faster, better: bigger total addressable market, faster growth, better unit economics. His firm made 50 investments last year across 25 countries and expects to do more this year. The strongest founders are not just showing what they have built so far; they are helping investors understand where the business is going next. Real revenue and real customers still matter, but they are not sufficient on their own. The founders who raise are the ones who can clearly and credibly answer where the company is today and where it could realistically be in the next 12, 18, or 24 months.
Dorothy Chang, Partner at Flybridge Capital, notes that generative AI coding tools make it easy to build new things, leveling the playing field and increasing competition. Founders building for venture scale need to ensure they are truly tackling a big idea, not just something easy to code, building in a problem area they are uniquely positioned to win, and bringing something proprietary that cannot easily be replicated. This could be a contrarian approach, unique insights, proprietary data access, deep networks, or a technological advantage. These are not new concepts, but the stakes and expectations are higher than ever.
Shamillah Bankiya, Partner at Dawn Capital, says for founders selling to enterprises, proving value and showing a line of sight to ROI will be more important than ever. The world has gotten smarter on the value AI can deliver. Founders who can prove their products offer much higher value have the best shot at raising capital.
What areas are you looking to invest in and why?
James Norman says his fund remains industry-agnostic generalists but is sharpening its lens. Today they are looking for high-context founders. In a world where AI has commoditized writing code, the winning edge is lived experience. They want to invest in founders who have spent years in the trenches of a complex industry and possess bespoke expertise that can be amplified by AI. The ideal investment is a marriage of deep subject matter expertise and a day zero distribution advantage, meaning founders already know exactly who will buy their product.
Morgan Blumberg is interested in sleepy or legacy industries outside core tech founder appetite, where AI can offer step-change ROI that drives adoption. These markets have lower competition and moats driven by complexity. She also believes 2026 will be a great year for infrastructure supporting foundational model development, as well as frontier research like embodied AI and world models. Healthcare remains a major focus, particularly on systems of record and platforms rather than point solutions.
Allen Taylor is looking outside the United States. He believes the best risk-adjusted venture returns are in markets like Poland, Turkey, and Greece. More than half of venture investment and the world’s unicorns are now outside the U.S. Founders in Latin America, Africa, the Middle East, and South Asia are building venture-scale companies, often serving massive markets from the start.
Dorothy Chang is most interested in founders tackling massive problems and leveraging technology for forward progress. She is unmoved by startups focused on automating workflows for specific verticals and is more interested in the larger platform shifts that will define this era of technological and societal progress.
Shamillah Bankiya sees the next frontier at the intersection of software and hardware. Most of the world’s GDP is locked in physical industries, and software-only solutions are not enough to fully unlock the world’s growth potential.
Do you think the IPO market will thaw? Why or why not?
James Norman believes the IPO market is likely to thaw, not because conditions are suddenly ideal, but because the system is running out of viable alternatives. The private market’s ability to sustain multi-billion-dollar valuations disconnected from profitability is wearing thin. Private credit has acted as a stopgap, but debt delays decisions rather than solving structural capital needs. Public markets remain the only place capable of providing capital at scale. Once investors re-engage around category-defining leaders, it creates permission for the broader high-growth software sector to follow.
Morgan Blumberg thinks we will see a reopening driven by a backlog of companies planning to list. Many large tech IPOs are anticipated, including companies like Anthropic and OpenAI. She believes one of these mega IPOs will drive considerable momentum for others.
Allen Taylor says yes. 2026 will be a big year for IPOs in New York as dozens of top companies decide it is time. It will also be a banner year for tech IPOs in unexpected places, like the stock market in Saudi Arabia. Nearly four years of muted activity have created a backlog of high-quality companies ready to be public. When the window opens, it will not just be U.S. companies stepping through it.
Dorothy Chang states her firm is looking to make slightly fewer, more concentrated bets. When they meet founders who really stand out, they want to back up their high conviction with a higher check size and higher ownership percentage.
Shamillah Bankiya thinks a hard catalyst would be required to reset the IPO markets, something akin to mega AI players facing unprecedented cost increases or sharp revenue declines, such as a sharp rise in energy prices making AI compute unaffordable.
How are you looking at the venture market for next year as a fund manager?
James Norman describes entering a clearing event for the venture market. Next year will separate durable platforms from transient ones. The fallout will hit Fund I managers who have not found their footing and Fund II managers struggling with a distributions drought. Traditional institutional anchors are in repair mode, leading to fewer new relationships and less tolerance for undifferentiated managers. Family offices are stepping into their place as active market forces. In 2026, there is no viable middle ground; you need a defensible track record or truly unfair access to differentiated deal flow.
Morgan Blumberg believes we are in the early innings of AI transformation, so she expects next year to be a strong vintage. Capital continues to concentrate in a select number of winners, so her focus is on being selective and operationally supporting portfolio companies. They are advising companies to strengthen their balance sheets for a potential downturn while building for the long term.
Allen Taylor says 2026 looks strong on both deployment and liquidity. Last year his firm had 12 liquidity events through M&A and secondaries. Venture is building a more complete liquidity toolkit with M&A, secondaries, and IPOs working together. Real structural shifts in core sectors, like the mainstream adoption of financial technology in markets like Latin America and Africa, make 2026 a strong year to be deploying capital.
Shamillah Bankiya states they are still searching for phenomenal European founders building groundbreaking companies, as great companies are formed in all cycles.
What will happen to all the investor and startup interest in AI next year?
James Norman says the AI curiosity of the last two years is being replaced by a demand for application and scale. We are moving from building models to building businesses. The fastest companies are using AI to solve high-value, domain-specific problems. Investors are not looking for AI startups anymore; they are looking for exceptional tech founders using AI to massively improve efficiency in traditional markets.
Morgan Blumberg expects investor and startup interest to continue at all-time highs. However, she thinks we will start to see tuck-in acquisitions, acquihires, and wind-downs in highly concentrated sectors like coding and sales automation as market share concentrates.
Allen Taylor believes interest will continue, but by the end of 2026, AI will stop being a separate category and will just be part of all new technology companies. The opportunity is in understanding where AI meaningfully changes cost structures, speed, or decision-making inside real businesses, where durable value is created.
Dorothy Chang does not see interest slowing down anytime soon. While a lot of investment has gone into infrastructure and theory, this year we will see more of that investment turn into enterprise value at the application level.
Shamillah Bankiya says AI will remain a hot topic, barring negative hard catalysts like an energy crisis or a rise in default rates.
What is something unexpected that could happen in 2026 in the world of venture and startups?
James Norman predicts the quiet end of the ChatGPT-first era in startups. No single model remains the default, as GPT is no longer consistently best-in-class for every task. Founders are graduating to a multi-model world focused on specialization. Model choice becomes an infrastructure decision, not a moat. The winners will be companies that orchestrate multiple models seamlessly, abstract complexity, and build proprietary workflows on top.
Morgan Blumberg expects to see many successful startups built with only one or two rounds of capital, as AI tooling enables profitability without excessive burn. From a technology perspective, companies may scale back LLM usage in favor of more controlled options like small models or hybrid models as enterprises prioritize explainability, cost, and reliability.
Allen Taylor suggests three unexpected things: a renaissance of investing in Ukrainian founders post-war, international companies from Latin America going public in New York at scale, and major technology IPOs coming out of the Middle East and listed locally, such as on the Saudi Stock Exchange, which will reset expectations about where global tech leadership lives.