Anders Ranum, partner at Sapphire Ventures, addresses the widening gap between public software multiples at decade lows and private AI valuations at record highs. He argues fundamentals like gross margins, free cash flow, and net revenue retention have actually improved, but investors are in a "show me" era demanding evidence of AI monetization, not just claims.

Ranum pushes back on frozen M&A narratives, noting software deal value rose 40% to $334 billion across 678 transactions in 2025. He predicts 2026 will be a historic IPO year with potential listings from SpaceX, Anthropic, and OpenAI, though most companies will wait for better conditions into 2027.

On the LLM stack, Ranum emphasizes becoming "genuinely embedded in how enterprises work" as the true moat against giants like OpenAI and Databricks. For industrial AI, he highlights portfolio company Tractian focusing on practical predictive maintenance in packing, picking, and inspection — where clear labor economics drive contract signings today, not humanoid robot hype.