Venture capitalists are shifting focus from software to hardware startups, with investors highlighting 15 companies to watch in 2026. This reversal marks a departure from recent years when VCs prioritized capital-efficient software businesses over hardware ventures that require heavier investment before returns materialize.

Earlybird cofounder Hendrik Brandis notes investors are warming to hardware with longer time horizons. Firstminute Capital's Adriana Vitagliano and First Momentum's Maximilian Ochs point to startups developing advanced robotics and AI-powered hardware, with funding rounds ranging from £9 million to €950 million.

The renewed interest in hardware reflects maturing markets for AI and robotics technologies. Investors now see hardware as more defensible amid increasing software competition, though still require longer patience before seeing returns compared to traditional software investments.