As generative and agentic AI technologies reshape the startup landscape, venture capital firms are adapting how they evaluate and fund innovation. The Agentic AI Summit brought together leading investors from Scale Venture Partners, Pear VC, RTP Global, and Eniac Ventures to explore how AI is changing deal sourcing, diligence, and defensibility. Affinity CEO Ken Fine moderated the conversation, which revealed some clear mindset shifts across the venture ecosystem.
Here are five key takeaways from the conversation—backed by market data and Affinity’s own insights into AI-first dealmaking.
1. AI is moving from workflow automation to labor replacement
AI investment is no longer just about improving efficiency—it’s starting to replace entire categories of labor. Investors are leaning into companies that can automate high-cost, knowledge-based functions across legal, healthcare, and financial services.
“Everyone frames it as SaaS was displacing workflow, and now AI is eating into labor budgets,” said Jeremy Kaufmann of Scale Venture Partners.
This shift is also driving a change in what investors look for. Kathleen Estreich of Pear VC emphasized related themes during the panel, including the importance of AI-native UX and how companies must rethink workflows when machines take on human tasks.
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2. Vertical AI is where real defensibility is emerging
While early AI investment centered on general-purpose tools, today's investors are prioritizing vertical applications with strong domain expertise and data moats. From legaltech to biotech, startups are gaining traction by embedding AI into high-friction workflows and solving problems no horizontal platform can.
“You’re seeing a longer tail of sectors where you can build a vertical solution,” said Hadley Harris of Eniac Ventures, noting the speed advantage for AI-native startups in niche markets.
Across the Affinity network, firms are increasingly tagging and tracking vertical AI deals—mirroring the shift discussed during this VC roundtable.
3. Speed and distribution matter more than novelty
The panelists agreed: success today is less about having the most novel model and more about who can get to market fast and scale distribution. Product velocity and customer experience continue to serve as key differentiators.
“You can’t differentiate on the exact value proposition anymore,” said Thomas Cuvelier of RTP Global. “You have to do it through superior workflows and customer experience.”
Affinity’s AI Dealmaking Guide echoes this trend, noting that “scalable AI isn’t just about model size—it’s about tuning, usage patterns, and integration into business workflows.”
4. Founders need focus—before scale
VCs are increasingly drawn to founders who are laser-focused on a narrow wedge—and have a clear vision for expansion. The strongest teams prove their value within a specific use case before trying to scale.
“Tackle something very narrow, then earn the right to expand,” advised Estreich. “Know why your starting point matters—whether it’s unique data access or owning mission-critical workflows.”
This reflects what we’ve seen on the Affinity platform: AI-first companies that clearly articulate their wedge and infrastructure advantage are raising faster and with stronger conversion rates.
5. Incumbents aren’t out—but they must act fast
While AI-native startups may have the edge, legacy companies aren’t out of the race. Those with strong customer trust and deep data assets can still win—if they move quickly and focus on the right narrow applications.
“Most [incumbents] aren’t doing this well,” said Harris. “They can’t move fast enough or throw away what no longer fits.”
As Ken Fine noted during the session, winning in today’s AI landscape means understanding where your data, relationships, or infrastructure give you a clear advantage—and doubling down on that "right to win."
The bottom line
VCs are no longer just looking for teams—they’re looking for infrastructure, precision, and speed. At Affinity, we’re seeing this play out firsthand: AI-native companies with scalable go-to-market strategies, strong data foundations, and clear vertical focus are capturing more interest and closing faster.
Want to learn more about how top firms are adapting to the AI-first future? Download our AI Dealmaking Guide.
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