A new a16z report looks at which AI companies startups are actually paying for

A new a16z report looks at which AI companies startups are actually paying for

On Thursday, Andreessen Horowitz unveiled its inaugural AI Spending Report, created in collaboration with fintech partner Mercury. This report leverages transaction data from Mercury to examine the top 50 AI-native application layer companies that startups are investing in, akin to their earlier analysis of the Top 100 Gen AI Consumer Apps. According to A16z partners Olivia Mooe and Seema Amble, the findings reveal that businesses are increasingly adopting a variety of AI solutions for specific tasks, with new applications rapidly emerging and fading from the landscape. "There’s a proliferation of tools," noted Amble, emphasizing that the market has not yet consolidated around a few dominant options within each category. The report highlights significant expenditures on "human augmentors" or "copilots," designed to enhance workforce productivity. This trend indicates that startups remain hesitant to fully transition to completely automated workflows. Amble remarked, "As computer use evolves, we anticipate a shift towards more comprehensive agent tools, moving away from reliance on copilots as users express eagerness to explore these innovations." Notably, the report's rankings were led by major players, with OpenAI securing the top position and Anthropic following closely in second. Vibe-coding tools also featured prominently, with Replit at number three and Lovable at number eighteen. Cursor claimed the sixth spot, while Emergent was positioned at forty-eight. Cognition, known for its enterprise-focused coding solutions like Devin and Windsurf, ranked thirty-fourth. A comparison with a previous consumer habits list revealed that Lovable had a higher traffic ranking than Replit. However, startups are investing more in Replit due to its enterprise features, which Lovable lacks. This diversity of companies on the list indicates a potential for multiple players to coexist in the market. Moore raised an intriguing question about the future of vibe coding: "Will the sector consolidate around a single best platform, or will several companies thrive in different niches? We don’t have that answer yet." Surprisingly, startups are also turning to consumer-oriented tools like CapCut and Midjourney, which are finding their way into enterprise environments. "Many of these consumer applications are being adopted in professional settings at an unprecedented rate due to their appealing designs," Moore explained. The report categorizes applications into horizontal and vertical sectors, with horizontal applications comprising at least 60% of the list. Vertical software companies primarily focused on sales, recruiting, and customer service. The research indicates that AI is making strides in areas previously dominated by service firms or consultancies, as many are evolving into software companies in the AI era. For instance, Crosby Legal exemplifies how AI can expedite legal contract reviews, replacing traditional processes that once necessitated in-person consultations with general counsel. Amble highlighted that current AI tools primarily assist employees in decision-making rather than replacing entire teams with automated systems. As technology advances, she anticipates a shift towards more autonomous agents capable of performing tasks more efficiently than humans. The report also noted a variety of note-taking applications such as Otter.ai, Retell AI, and Habbyscribe, none of which have yet emerged as market leaders. This reflects Amble's observation that startups are still exploring their preferred tools, allowing employees the flexibility to choose applications that best suit their needs. A significant trend identified in the report is the blurring line between consumer and enterprise applications. Individuals are increasingly bringing personal tools into their professional environments, and entrepreneurs are leveraging their favorite consumer applications to support their businesses. Amble and Moore pointed to Canva as a prime example, highlighting how its evolution from a consumer app to a tool with substantial enterprise appeal has taken years. As the distinction between personal and business applications diminishes, companies are more inclined to integrate both markets. Moore and Amble predict that the landscape will continue to evolve rapidly, with established companies introducing AI features to maintain relevance while new players emerge with innovative concepts. "In just twelve months, what we consider legacy players may be completely different," Amble cautioned. "Will the same note-taking applications still dominate, or will a new wave of solutions take their place?"

Sources : TechCrunch

Published On : Oct 02, 2025, 15:35

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