Summary
As AI models plug into the software companies already use, where does an AI-native startup still have an edge? This a16z podcast episode tackles the question with a focus on enterprise procurement. Host Elena Burger talks with a16z partner Sema Amble, author of the essay “The Incumbents Are Coming,” and Vlad Kyle, co-founder and CEO of Leo, which builds AI agents for procurement.
The guests argue that incumbents are tied to their system of record, while the real work spans emails, contracts, spreadsheets, legal review and dozens of stakeholders. Startups that own the entire end-to-end workflow can capture value that a single system cannot. Kyle gives concrete examples from manufacturing, such as a supplier’s delayed-delivery email buried among hundreds of messages that can cost a company hundreds of millions of dollars if missed.
The conversation also covers why enterprises do not begin with fully autonomous negotiation agents. A human-in-the-loop approach builds trust over thousands of negotiations before autonomy expands. The guests discuss using external context, such as supplier reliability and news, to predict disruptions, and what makes a vertical AI company durable when moats are hard to forecast.
The episode is useful for founders, investors and operators trying to understand where AI applications can compete with established software vendors.
📺 Source: a16z · Published October 02, 2026
🏷️ Format: Podcast
