Will business applications consolidate into a single general AI conversational agent, or will specialized applications continue to have durable value?

Tom Blomfield · published May 13, 2024

Incumbents like Microsoft Office and Google Docs won't displace vertical AI applications, because a general product can't handle specialist workflows like dental clinical notes, architectural 3D modeling, or patent drafting

Microsoft Office by definition has to be a general product; it may be the best word processor but it won't be the tool a dentist uses for clinical notes or the tool that writes high-quality patent submissions

Scope: concedes incumbents will benefit in the general document-writing category

45:13 20VC: Behind the Scenes at Y Combinator: The Interview Process | What the Best & Worst Do in the Program | Do the Best All Raise Pre-Demo Day & YC's Fundraising Advice to Startups | Why the Value is in Application Layer AI with Tom Blomfield

Severin Hacker · published May 19, 2025

A dedicated app can make an experience far stickier than the same functionality built as a secondary feature inside another product

Duolingo's gamification mechanics — streaks, XP, leagues — can be rebuilt anywhere, but buried as a second-class citizen they don't produce the same stickiness

26:22 20VC: Duolingo Co-Founder on Why $3M is Harder than $100M to Raise | Why You Should Always Take Tier 1 VCs Even at Worse Terms | Why Europe Can't Win Unless the US Screws Up | How AI Impacts the Future of Work and Education with Severin Hacker

Mike Cannon-Brookes · published Oct 13, 2025

Business applications will not all collapse into a single godlike conversational agent; specialised applications will persist because they serve specific purposes better

Every enterprise app could in theory be replicated with email and Excel, yet the last decade produced a Cambrian explosion of specialised SaaS apps precisely because they do specific tasks much better

Scope: allows that AI will change all of those applications fundamentally; some apps may disappear while others profit

22:44 20VC: Atlassian CEO on Why Everything is Overvalued & Are We in an AI Bubble | Do Margins Matter & Does Defensibility Exist in an AI World | Is Per Seat Pricing Dead & The Future of Vibe Coding with Mike Cannon-Brookes

Harrison Chase · published Oct 18, 2026

Most apps should have their own vertical agent rather than just exposing APIs to a horizontal agent

Apps know more about how you personally interact with them than a general horizontal agent can learn, and wrapping their many APIs in a single natural language interface is a better experience for the horizontal agent to consume

Scope: two reasons given as the ones that jump to mind, not exhaustive

32:46 20VC: Horizontal vs Vertical Agents: Who Wins | Model Routing: Commodity or Increasing in Value | The Future of the Inference Market | Why Founders Should Take Discounts for Tier 1 Firms with Harrison Chase, LangChain

Harrison Chase · published Oct 18, 2026

The future is providers exposing their own vertical agents, with users or their horizontal agents interacting with those agents rather than scraping or hitting APIs directly

34:44 20VC: Horizontal vs Vertical Agents: Who Wins | Model Routing: Commodity or Increasing in Value | The Future of the Inference Market | Why Founders Should Take Discounts for Tier 1 Firms with Harrison Chase, LangChain

Harrison Chase · published Oct 18, 2026

The consumer space will have both horizontal and vertical agents, with horizontal agents interacting with vertical ones

32:35 Consumer space will feature both horizontal and vertical agents with horizontal agents calling vertical ones