What I'm preparing for in 2025

Seven themes that I believe will define the year.

Jan 08, 2025

Welcome to issue #58 of next big thing.

While it’s been another exciting week in the technology industry, it’s hard for me to think of much else today than the fires in the Los Angeles area that have displaced and impacted so many people already. Hoping the worst is over, that the fires are contained soon, and that no more lives are lost.

Last week, I published a compilation of ideas from 50 tech thinkers on what the next big thing will be in 2025.

Today, as I did a year ago, I want to offer my own thoughts on what I believe will be the themes that define the year ahead. There are, once again, seven themes, and I’ll grade them at year-end.

AI-Native Applications

What we’ve seen over the past year is a number of companies fitting a certain profile — a small team, building an AI-native product that is growing quickly in users and revenue, often serving both consumers and enterprises, and doing so very capital efficiently. For example, one of Footwork’s portfolio companies is about to surpass $10 million in annual recurring revenue, having launched two years ago, with a team of less than 20 people today, and with more capital on the balance sheet than they’ve raised in total venture funding (i.e. they have been profitable over the lifetime of building the business). A few years ago, this would have been truly extraordinary, but today there are dozens of companies that are writing a similar story. And by the end of 2025, I think there’ll be hundreds of companies like this, because it is uniquely possible in this era of AI. Software is faster and cheaper to build, and products can spread by word-of-mouth very quickly. ChatGPT is of course the canonical example here (though not in capital efficiency given OpenAI’s level of burn), having reached more than 300 million weekly active users since launching just over two years ago. A truly mind-boggling growth rate.

AI Workers

Related to the above, some of the applications that will grow the fastest this year will be AI workers — coders, salespeople, customer support agents, debt collection agents, clones, and more, that are AI team members instead of human ones. Though the “agent” term has become widespread, I really love this framing from Elicit co-founder Jungwon Byun: “The next big thing in 2025 will be AI moving from assistants to collaborators.” I think of the compelling and productive AI workers more as collaborators than as agents, and suspect that this framing will resonate with end users and software buyers as the year goes on.

Non-AGI Breakthrough

While all eyes are on AGI, which we will clearly make progress towards in 2025, if not “achieve” by many definitions, I believe we’ll see a breakthrough in another area of technology, such as biology, robotics, energy/climate, healthcare, that will blow us away and be a ChatGPT-in-2022-like moment in 2025. It is likely to be related to all the advancements in AI but I think it will be distinct and open up a new set of “platform” opportunities for early-stage startups in the way that LLMs have.

Crypto <> AI

The intersection of crypto and AI has felt like a fertile ground for compelling new products for a while, and I hope we see some awesome user experiences uniquely enabled by this intersection in 2025. I am no expert here, but when I think about the adoption of stablecoins over the past few years, crypto-native products like Bridge, Farcaster and Sling growing in usage, the magic of many AI-native user experiences, the usability issues with many crypto-native experiences, the data trust issues with many AI-native products… it just feels like there is much that can marry the best of each area while eliminating the worst of each. As with small teams building fast-growing, capital efficient, AI-native application companies, per the first theme in this post, I’d love to meet anyone building something that users are loving at this intersection of AI and crypto.

Hardware! (not Apple)

Over this past year, I got into our Model Y in San Francisco, reversed out of our garage, turned on full-self-driving, and did dozens of drives where the only times I took over from FSD were upon reaching our destination to park (a few lane changes too, but with FSD still engaged). It is remarkable how far Tesla and Waymo (which I also took dozens of times in SF last year) have come, and autonomous driving will have an exciting year of expansion to more cities in 2025. In consumer hardware, I can’t believe I’m typing these words (and this is not investment advice!), but I am long Meta, short Apple. I became a very active (weekly, often daily) user of Meta Ray-Bans last year, which are especially great to use with young kids (hands are often full!). I’m excited for Orion. And I’m really bummed about the latest iPhones, (the lack of) Apple Intelligence thus far, and Vision Pro.

Exits! (though 2026 will be better)

IPOs and M&As will be back this year. I thought that last year would be a readiness year for many companies to be able to go public this year. And they will, although I think 2026-27 will be more exciting IPO years than 2025, given the lack of much urgency to go public for leading prospects.

Government (In)Efficiency

If you spend anytime online, particularly on X, it will be hard to avoid following the efforts of DOGE (the department of government efficiency) this year. I think there’ll be a lot of attention on where they think they’re finding “efficiency” but in reality it will all be more inefficient than the folks working on this want it to be, because of the chaotic way in which they go about trying to enact change. I am optimistic that some of the change will be positive progress, but I suspect there will be more talk than action that actually moves the needle on efficiency (particularly given the % of federal spending on entitlements, defense, and debt, that is near-impossible to touch).

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