Vibe Coding, The $6.24B Shift, and The End of the Black Box
Plus: Why "Black Box" AI is becoming a legal liability and how to avoid the "Aperture Trap."
Hi Everyone,
The numbers for 2025 are in, and they tell a conflicting story. Deal volume is down 16%, yet total investment has climbed to $6.24B.
The market is chugging along while becoming incredibly disciplined. We are seeing a “squeezed middle” where growth-stage vendors struggle, while capital floods into early-stage innovation and high-conviction bets.
In this Substack, we unpack the new data, the "Vibe Coding" hype, and the two major strategic shifts defining the year for founders and HR leaders.
WATCH & LISTEN
From Agentic AI to Vibe Coding: The Forces Redefining HR Tech
In the latest WorkTech Podcast, I break down the 2025 Global WorkTech Report. I discuss why Vibe Coding is creating false confidence in enterprise HR and Work Tech, and why AI explainability is fast becoming a massive legal risk. Key Stat: 136 early-stage deals captured $1.1B in capital. Innovation is alive and well.
Key Takeaways:
The Investment Paradox: Capital is up, but deals are down. The bar for entry is higher than ever.
The “Squeezed Middle”: Growth-stage vendors are facing a crisis of consolidation.
Infrastructure Shift: Agentic AI is replacing standalone tools with infrastructure-level capabilities.
DEEP DIVE: AI & ETHICS
AGENTIC AI IS SHATTERING THE “BLACK BOX”
For years, recruitment tech was a mystery. Inputs went in, candidates came out, and nobody knew why. That is no longer legally or ethically sustainable. We explore why Agentic AI is becoming the first real win for transparency and how it finally cracks the black box open.
FOUNDER STRATEGY
THE APERTURE TRAP: THE SILENT KILLER OF STARTUPS
With investors becoming more disciplined, the margin for error is zero. Too many founders fall into the “Aperture Trap.” Widening their focus to chase a broad market before they are ready. It’s one of the biggest silent killers of Work Tech startups.
If you are navigating the "squeezed middle" or just starting out, this is the strategic pivot you need to understand.