Venture capitalists predict companies will spend more on AI in 2026 – thanks to fewer suppliers

Companies have been piloting and testing different AI tools for the past few years to determine what their adoption strategy will look like. Investors believe this period of experimentation is coming to an end.

TechCrunch recently surveyed 24 business-focused venture capital firms and an overwhelming majority predicted that companies will increase their budgets for AI in 2026 – but not for everything. Most investors said this budget increase would be concentrated and many companies would spend more funds on fewer contracts.

Andrew Ferguson, vice president of Databricks Ventures, predicts that 2026 will be the year when companies begin to consolidate their investments and pick winners.

“Today, companies are testing several tools for a single-use case, and we are seeing an explosion of startups focused on certain purchasing centers like [go-to-market]where it is extremely difficult to discern differentiation, even during [proof of concepts]”, Ferguson said. “As companies see real proof of AI, they will cut some of the experimentation budget, streamline overlapping tools, and deploy those savings into the AI ​​technologies that have delivered results.”

Rob Biederman, managing partner at Ametric Capital Partners, agrees. He predicts that companies will not only focus their individual spending, but that the broader business landscape will reduce its overall AI spending to just a handful of vendors across the industry.

“Budgets will increase for a narrow set of AI products that clearly deliver results and decrease sharply for everything else,” Biederman said. “We expect a bifurcation where a small number of vendors will capture a disproportionate share of enterprise AI budgets while many others will see their revenues stabilize or contract. »

Targeted investments

Scott Beechuk, partner at Norwest Venture Partners, believes companies will increase spending on tools that make AI safe for business.

“Businesses now recognize that the real investment is in the levels of protection and monitoring that make AI trustworthy,” Beechuk said. “As these capabilities mature and reduce risk, organizations will feel confident moving from pilots to large-scale deployments, and budgets will increase. »

Harsha Kapre, principal at Snowflake Ventures, predicts that companies will spend on AI in three distinct areas in 2026: database hardening, post-training model optimization, and tool consolidation.

“[Chief investment officers] let’s actively reduce [software-as-a-service] scaling and moving toward unified, intelligent systems that reduce integration costs and deliver measurable results. [return on investment]”, Kapre said. “AI-based solutions will likely benefit the most from this shift.”

A move away from experimentation in favor of concentration will affect startups. What’s not clear is how.

It’s possible that AI startups will reach the same point of reckoning as SaaS start-up happened a few years ago.

Companies that operate products that are difficult to replicate, such as vertical solutions or those based on proprietary data, will likely still be able to grow. Startups offering products similar to those offered by big vendors like AWS or Salesforce could start to see pilot projects and funding dry up.

Investors also see this possibility. When asked how they knew an AI startup had a moat, several venture capitalists said companies with proprietary data and products that can’t be easily replicated by a tech giant or large language model company are the most defensible.

If investors’ predictions prove true and companies begin to focus their spending on AI next year, 2026 could be the year that company budgets increase, but many AI startups don’t see a bigger piece of the pie.