Looking back at 2025
Our annual predictions post is back!
2025 has been an incredible year. New AI models have made it possible to reshape jobs and entire industries and pickleball got even hotter. For our team, Paul and the Browserbase team raised a Series B and George raised a pre-seed round and launched Rely.
Hawk Hill Ventures has been active too! We made 20 angel investments across infrastructure, dev tools, vertical SaaS and even a PE-leaning veterinary business and looked at hundreds more.
Below are our predictions for 2026.
George’s 2026 Predictions
2026’s Breakout Companies Automate Entire Jobs, Not Tasks
For years, software promised leverage but delivered dependency: more tools, more steps, more dashboards. In 2026, the winners flip that relationship. The most important startups will be the ones that collapse full job descriptions into automated systems, taking work that previously required teams of analysts, coordinators, auditors, or operators and executing it end-to-end.
Prediction: We will see a higher percentage of 2026 winners that achieve this outcome. Fewer humans will do the same work at higher quality, which finally changes the economic shape of whole industries.
A High-Profile AI-Related Bankruptcy
The last two years were marked by an unshakeable belief that AI rising tides lift all boats. In 2026, one of the boats will sink and loudly.
Some companies built their valuations on access to models, not durable distribution, data, or workflow ownership. Others built headcount-heavy pseudo-services businesses packaged as AI. And a handful raised money at valuations the underlying business simply will never support once capital markets tighten.
Prediction: A major AI darling, high burn, thin real-world margins collapses in a very public way. The shift will force investors to start looking at AI businesses for sustainability which will be healthy for the category.
SBF Gets Out of Jail
I just feel like this is going to happen.
Paul’s 2026 Predictions
AI models will be able to work for a week straight
If you’ve been paying attention, AI capabilities have kept improving as models get more sophisticated. One way to measure this is task duration. The METR team benchmarks how long models can work on complex tasks, measured in hours. This has grown exponentially over the past several years. I think model capabilities will continue to improve in 2026, and by year end, the trend in the graph above will continue. Models will complete tasks spanning multiple days, up to a full week.
2026 will have the most tech exits of the past 10 years
Valuations are elevated and there are clear signs of market froth, but the party isn’t over. Real businesses are being built, and the need for capital will outstrip what private market investors can provide. For the largest players building the most important technology in the world, increased regulatory scrutiny may demand they go public to improve transparency and corporate governance. This seems inevitable. The backlog of giant companies that held back on IPOs due to regulatory concerns or no need for capital will fade as the biggest companies keep winning. And smaller companies will get acquired faster as the pressure to move quickly and bring in technology has never been higher.
Everything will be ok
If you work in AI, follow the industry closely, or have read enough sci-fi, these improved capabilities can feel scary. You might worry your job will be automated. “What’s my value if not my ability to make spreadsheets?”
I have a different view.
Working with our customers at Browserbase, I keep seeing the same thing: the bottleneck to AI adoption isn’t model quality anymore. It’s the ability for humans to teach others about complex problems and evangelize how we solve them with technology. It’s a human problem holding back AI adoption, not a capabilities problem.
The singularity isn’t coming tomorrow to take all our jobs. It’s going to be gradual. And I’m confident that in 2026, everything’s going to be ok. Quality of life will improve for many people. Those willing to accept and understand this new technology will have an edge. The only people who won’t be ok are the ones who reject this technological revolution. Burying your head in the sand won’t avoid the inevitable. The way we do everything is about to change, hopefully for the better.
Onwards to 2026
We really appreciate everyone who follows our tiny newsletter. Selfishly, we mostly write for ourselves. Putting ideas on paper helps us think and push our companies forward. Thank you for continuing to read, question, comment, and share our thoughts. We always appreciate your engagement!
We hope you have a great holiday season, and we’re looking forward to continuing to be in your inbox every month in 2026.