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The Emerging Vertical AI Landscape, And Our Vertical AI Market Map | by Cowboy Ventures | Cowboy Ventures | Nov, 2023 | Medium

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Historically, ‘vertical software’ — aka software purpose-built for a specific industry like construction, home healthcare or supply chain — has attracted fewer venture dollars and delivered relatively few $Bn+ sized outcomes relative to ‘horizontal’ software. Challenges have included smaller addressable markets (TAM), difficult customer acquisition (CAC), long sales cycles and lower price points (ACVs). But a new window has been opened for vertical software — by AI. Horizontal products like ChatGPT and Midjourney have given millions of users a taste of the power of AI, but enterprises have barely gotten started (gen AI is < 1% of cloud spend, as noted in Menlo Ventures’ recent report). The time is ripe for founders to build AI-native software that delivers new capability to customers, leveraging models built on industry-specific data. We’re excited to see many more Toast, Procore, and Veeva-like outcomes with teams that build with AI and understand the nuances of a specific industry. A

The Emerging Vertical AI Landscape, And Our Vertical AI Market Map Cowboy Ventures 5 min read · Nov 17, 2023 -- 3 Listen Share By Aileen Lee and Matt Lu , Cowboy Ventures At Cowboy Ventures, we’re excited about a coming wave of “vertical AI” software companies. Historically, ‘vertical software’ — aka software purpose-built for a specific industry like construction, home healthcare or supply chain — has attracted fewer venture dollars and delivered relatively few $Bn+ sized outcomes relative to ‘horizontal’ software. Challenges have included smaller addressable markets (TAM), difficult customer

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