Insights
Our perspective on changing markets and where we're investing next.
Notes, theses and field reports from the Lateral team on services-to-AI-native transformations and the founder-led businesses reshaping the markets we invest in.
Insights
Notes, theses and field reports from the Lateral team on services-to-AI-native transformations and the founder-led businesses reshaping the markets we invest in.
The Vertical Edge · monthly
The Vertical Edge — July 2026
Vertical AI solutions can upgrade skilled labor functions, a $6-8T addressable market
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Domain expertise is the context layer that turns model output into trusted, compliant work.
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How the market is pricing vertical vs. horizontal software — tracked monthly, with Lateral's read on direction and sentiment.
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Proprietary, decision-capturing data over a long period of time is the training signal competitors cannot replicate
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The right to run AI in enterprise businesses is earned over years and should be evolutionary, not revolutionary
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The durable assets in vertical software are trust, data, and expertise, not the technology.
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Why the market now pays a 58% premium for vertical software over horizontal — and lesson to draw about AI market dynamics
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Here are 5 rules we see taking shape and the 3 key qualities we look for in backing AI transformations
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Token burn has become a proxy for AI adoption. Proxies get gamed — and then they get repriced to ROI.
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When software focuses on performing work, selling outcomes becomes more relevant than selling seats
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When software goes 'headless' and agents outnumber humans in manipulating software, the competitive advantage resets in favor of vertically focused solutions
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The software industry has historically drawn a hard line between software and services. With AI-native solutions, that line is increasingly blurry.
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The AI-native company is a different kind of business than SaaS, with the potential to target "knowlege worker" labor budgets and multiply end-user productivity levels
Read →The AI-native company is a different kind of business than SaaS, with the potential to target "knowlege worker" labor budgets and multiply end-user productivity levels
Read →The software industry has historically drawn a hard line between software and services. With AI-native solutions, that line is increasingly blurry.
Read →When software goes 'headless' and agents outnumber humans in manipulating software, the competitive advantage resets in favor of vertically focused solutions
Read →When software focuses on performing work, selling outcomes becomes more relevant than selling seats
Read →Token burn has become a proxy for AI adoption. Proxies get gamed — and then they get repriced to ROI.
Read →Here are 5 rules we see taking shape and the 3 key qualities we look for in backing AI transformations
Read →Why the market now pays a 58% premium for vertical software over horizontal — and lesson to draw about AI market dynamics
Read →The durable assets in vertical software are trust, data, and expertise, not the technology.
Read →The right to run AI in enterprise businesses is earned over years and should be evolutionary, not revolutionary
Read →Proprietary, decision-capturing data over a long period of time is the training signal competitors cannot replicate
Read →How the market is pricing vertical vs. horizontal software — tracked monthly, with Lateral's read on direction and sentiment.
Read →Domain expertise is the context layer that turns model output into trusted, compliant work.
Read →Vertical AI solutions can upgrade skilled labor functions, a $6-8T addressable market
Read →