WHAT’S INSIDE

👇️ Feature: AI as a Service: Vertical AI Eats SaaS?

Also: Big Tech Earnings, Trump-Xi Truce, Rare Earths Respite, Azure Outage, OpenAI's Trillion-Dollar AI Infra Dream, Apple App Store Victory, Trump Approval Low.

• Company Watch: EquityZen, Poolside, The Prompting Co., Anthropologie

• Buzzy Tools: Latest Buzzy tech, AI and financial tools

• Deep Tech: The latest in deep tech, biotech, futurism and more

• Space Tech: Latest news in the space race and aerospace tech

• Crypto: Blockchain and crypto policy and startups or protocols to watch

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TECH IN THE NEWS

Trump and Xi's Truce — Trump and Xi Jinping agree to pause new restrictions on rare earth exports and reduce tariffs from 57% to 47%. China will buy U.S. agricultural goods and help curb fentanyl exports. They didn’t discuss Nvidia chips.

Rare Earth Respite — China postpones rare earth export restrictions after trade talks with the US. Treasury Secretary Scott Bessent expresses optimism.

Azure Outage Woes — Microsoft's Azure suffered a major outage due to a configuration error, impacting Microsoft 365, Xbox Live, and companies like Alaska Airlines and Starbucks.

OpenAI's Trillion-Dollar Dream — Sam Altman, CEO of OpenAI, targets a $1.4T AI infrastructure with 30GW of computing power as it eyes an IPO and significant revenue growth.

Apple App Victory — A federal judge decertified a class action lawsuit against Apple over alleged monopolization of the iPhone app market. The court found insufficient evidence of classwide injury, marking a win for App Store practices.

AI Under Fire — The FTC has received numerous complaints about ChatGPT causing delusions. Character.ai and OpenAI are implementing safety measures to address AI's mental health impacts, including detecting 3rd-party harm.

Trump's Economic Woes — A Yahoo/YouGov poll finds 60% of Americans disapprove of Trump's economic management. With 76% citing rising grocery prices and 56% seeing worsening conditions, his approval hits a record low.

AI as a Service: Vertical AI Eats SaaS?

Sriram

Is SaaS losing the edge? 85% of new workflows and a majority of VC money flows are going AI-first and industry-specific in the rush to Vertical AI.

The Control Point Shift

SaaS companies won the last era with a boom similar to the dot com craze. Many startups were centralized around building software as a service and they standardized workflows and had great revenue streams through per-seat subscriptions. The pitch was simple: display info in a single source (CRMs for example, like Salesforce). And every type of industry could adopt these horizontal tools because of its general use cases.

It’s not just startups getting into Vertical AI, the Big Tech giants have been leading the charge: 

1. OpenAI: Offers tailored Agentic AI solutions for a multitude of industries and tasks including IT, finance, marketing, and customer service use cases.

2. Microsoft: Integrates Copilot into Office products for specific finance, sales, and other solutions. Delivering domain specific automation inside familiar products.

3. Google: Vertex AI, Google’s Cloud product, offers products for healthcare, retail, and media combining their models with data services across their products and platform.

4. AWS: Healthcare and finance AI services, e.g. medical transcription services in HIPAA friendly stacks. 

So What Is The Comparison Now? 

Horizontal SaaS vs Vertical AI. Horizontal products are general purpose software that is built for a wide range of industries and people. Vertical AI tools are domain specific and built from the ground up with the industry use cases and problems in mind. Currently popular industries for Vertical AI adoption include Healthcare, Law, and Fintech. SaaS is mainly CRMs and dashboards which track work, Vertical AI tools actually get the work done like producing a clinical note, drafting a contract, or analyzing potential investments.

Why shift now? 

There are three main reasons for a sudden shift into Vertical AI:

1. Vertical AI leverages deep industry-specific data, leading to better results with higher accuracy compared to generic SaaS.

2. It fits directly into established workflows, automating much of the work clearing time for employees and integrating with professional processes.

3. Enables companies to achieve much faster go-to-market and lower deployment friction because of automation and integrates with existing tech stacks.

Industry Performance: SaaS vs Vertical AI

The gap in performance between SaaS and Vertical AI shows up across industries, especially because of Vertical AI’s automation capabilities. A specific example could be SaaS solutions in the legal services industry. Generally in the past, SaaS tools such as Clio and NetDocuments were used for data storage/access for law services and reducing manual paperwork, with employees still doing the gruntwork. These were a huge innovation in their time,  speeding up billing and paperwork by 25%. 

Spotlight: Harvey, the legal Vertical AI solution, clients report having 

• 80% reduction in contract review

• 60% less repetitive drafting

• 3x faster case research & due diligence

Instead of just organizing documents, Harvey is a Vertical AI tool that's a great example of all the stated benefits of automation and deep integration into existing workflows. It even drafts contracts, highlights legal risks, and summarizes key clauses.

Harvey showcases the unicorn potential of Vertical AI solutions, it has become a top startup after hitting ~$100M in ARR in August 2025, serving over 500 firms, and reaching a $5B valuation after raising a $300M Series E funding round.

Harvey is  just one of the toolsets for one of the many industries that Vertical AI boosts efficiency in. Essentially, SaaS increases organizational efficiency and Vertical AI tools such as Harvey transform companies into high output machines with workflow automation.

Venture Capital Perspective: Where Capital is Concentrating

Venture investment into Vertical AI has also hit record highs, signalling another boom and also supporting the higher unicorn potential these companies have. Bessemer Venture Partners themselves have invested over $1B into AI native startups since 2023, with two thirds of its early stage funds being put into Vertical AI. And it's not just Bessemer, as over 50% of all global VCs go to startups with Vertical AI and AI Agent solutions. Backers such as them prove it is not just another hyped up trend, and the funding landscape has never been more competitive as sources say deal intensity is up to 2-3x compared to previous markets. 

Again take Harvey for example, they closed a back to back Series D and E totaling their funding all the way up to $600M in 2025, an outstanding number for the current market. Obviously VC firms only risk this money because of the stunning velocity at which they grow and reach figures such as $40-100M ARR in short periods of time. 

Now more than ever, companies have begun pouring money into the application layer for Vertical AI for business functions such as customer service, compliance, law, IT, finance, and more, all aiming for workflow automation. For VCs, their capital is leaning towards vertical apps that become “AI employees” that cut down work and costs.

Future Predictions: Vertical AI’s Trajectory

The Vertical AI market is on track for explosive and sustained growth. In 2030, industry analysts project that the AI sector will top up to $800B globally. Having vertical solutions expand rapidly and cause companies to shift even more from generic SaaS to domain specific platforms. Vertical software alone is forecast to triple from $169B to $550B by 2035 with a growth of 12.5% yearly. 

Advances in hardware, energy, and compute also are aiding the adoption of AI across a multitude of industries and accelerating innovation because of lower costs, making it accessible to even smaller enterprises. 

The verdict is that looking ahead, all the factors lead to Vertical AI beating SaaS because of its domain-specific benefits, more accessibility, and deep integration. Investor capital will also keep flowing to vertical solutions that offer workflow automation and retention, creating pressure for horizontal, generic SaaS players. For founders, buyers, and strategists, the next decade will be defined by tight product market fit and the ability to be the/a go to platform or operating system for industry specific operations.

COMPANIES TO WATCH

Big Tech Earnings Reports

OpenAI — Prepares for an IPO that could value the AI powerhouse at up to $1T by late 2026 or 2027. The company plans to raise $60B, aiming for a $20B ARR despite losing ~$11.5B last quarter based on Microsoft’s $3.1B hit on its 27% stake.

Nvidia — Achieved a $5T market cap, targets $6T fueled by a 5% share surge and a $1B strategic AI-driven telecoms partnership with Nokia & launches the first AI-native 6G stack in the U.S. with T-Mobile and Cisco. NVIDIA BlueField-4 enhances AI factory capabilities with 6x compute power.

Apple — Hit record Q4 revenue of $102.5B driven by strong iPhone 17 sales ( esp. new iPhone Air) and high Services revenue. Earnings rose 13%. Announced a shift towards a multi-AI platform, beyond OpenAI to position Siri to use the best models.

Alphabet — Surpassed $100B in Q3 revenue on 35% Google Cloud growth & a $155B backlog. Plans to increase capex to $93B on AI infrastructure investments strengthening its search business. Stock rose 4%. Google teamed up with Reliance Jio on a major AI initiative in India. Reviving a closed nuclear plant in Iowa for AI.

Meta — Beat on Q3 revenue of $51.24B but stock dropped 8% due to projected $70-72B 2025 AI spend, long-term return concerns. Reality Labs reported a $4.4B loss in Q3, $70B+ since 2020.

Amazon — Stock surged over 10% after strong Q3 earnings. AWS revenue grew 20.2% to $33B on AI demand and infrastructure investments as AWS remains dominant in the cloud market.

Other Companies To Watch

Morgan Stanley x EquityZen — Acquired the private company trading platform EquityZen to bolster its offerings for private company and wealth management clients. It aims to enhance liquidity solutions, expanding access to private shares.

Poolside — Nvidia plans to invest up to $1B in AI coding startup Poolside, valuing it at $12B. It aims enhance its capabilities focusing on enterprise-grade AI solutions.

The Prompting Company — The generative engine optimization (GEO) startup helps brands optimize for AI-driven product recommendations. Raised $6.5M, client list includes Fortune 10 cos. Partners with NVIDIA to adapt to 520% traffic increase.

Anthropologie — The Philadelphia lifestyle and fashion brand has grown sales from $1.6B to $2.4B in five years. By enhancing digital marketing and product lines, it plans to expand internationally and launch a new brand, Maeve, targeting youths.

 SignalPulse — Read the Top signals, Startups + Deals From Last Week

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BUZZY TOOLS

Buzzy Tech Tools To Watch & Use

Gemini for Home — Google’s AI Home voice assistant + AI-powered workplace leadership course.

Microsoft — Windows 11 on Quest 3 for affordable mixed reality productivity.

Anthropic — Claude AI integrates with Excel for real-time financial analysis.

Adobe — Opens Photoshop to 3rd-party AI models like Gemini 2.5 Flash.

Cursor — Composer model for rapid code, multi-agent interface.

Rogo — AI tools for investment banking efficiency, valued $750M by Sequoia.

Canva — Creative OS with AI tools for design and marketing rivals Google, MS.

SwitchBot — $23.99 device makes appliances smart without rewiring for renters.

BUZZY TECH

The Latest Deep Technology & Trends To Watch

NVIDIA's 6G Leap — The first AI-native 6G stack in the U.S. with T-Mobile, Cisco.

AI-Powered Browsers — Critical vulnerabilities in OpenAI and MS browsers.

MS Windows Update — Emergency patch fixes remote code execution exploit.

ChatGPT Atlas Risk — Prompt injection flaw risks AI phishing, file deletions.

PRIMA Retinal Implant — Wireless implant restores vision in macular degen.

CRYPTO WATCH

SpaceX's Bitcoin Shuffle — SpaceX moved 281 BTC (~$31M) to a new wallet, part of a trend to consolidate holdings. Since October, 4,337 BTC (~$471.7M) were transferred. Currently, SpaceX holds 7,258 BTC, valued at around $799M.

Coinbase — Beat expectations with $1.50 p/share and $1.87B revenue. Institutional trading soared 122% to $236B fueled by regulation, Partnered with Citigroup to offer digital asset payment solutions for institutional clients, facilitating fiat in-out.

Consensys IPO Ambitions — The parent of MetaMask is planning an IPO with JPMorgan and Goldman Sachs. Inspired by favorable market conditions, the move follows Circle and Bullish. It will also introduce a native token and new trading tools.

MegaETH ICO — “Real-time” Ethereum L2 MegaETH just closed its ICO deposit campaign with more than $1.3B committed, making it nearly 28x oversubscribed.

KRWQ Launch — IQ and Frax introduce KRWQ, the first Korean won-pegged stablecoin on Base Layer 2, using LayerZero's Omnichain standard. Not yet available in South Korea, it awaits regulatory clarity on stablecoin issuance.

Uphold XRP Card — Uphold reintroduces its US debit card, offering up to 6% XRP rewards for spending dollars, crypto, or stablecoins. An extra 4% is available for paycheck deposits.

Uplift Mobile Network — NBA champion Tristan Thompson partners with World Mobile to launch Uplift, a community-owned blockchain mobile service offering unlimited data for $9.99 mthly. Aims to enhance coverage and profits for local ops.

SPACE_RACE

Space Investment — Cheaper borrowing fuels optimism; SpaceX thrives.

SpaceX Artemis 3 — Simplified mission architecture aims to speed moon return.

Golden Dome — Defense contractors invest billions despite shutdown, data gap.

Space Command Lawsuit — Colorado sues SC over planned move to Alabama.

EnduroSat — $104M funding boosts small satellite production, expanding facility.

StarDetect — Enhances satellite AI with 100M yuan for efficient space tracking.

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