Since 2022, funding for consumer technology startups has been on a downward trajectory. A volatile macroeconomic environment and persistently high inflation have made venture capitalists cautious about consumers' purchasing power. Over the past few years, the majority of investments in the artificial intelligence sector have focused on acquiring enterprise clients—customers who not only provide large orders and multi-year contracts but also help companies scale rapidly.

However, one venture capitalist believes the consumer sector is poised for a recovery in 2026.

"2026 will be the year of the consumer," stated Vanessa Larco, a partner at venture firm Premise and former partner at NEA, on this week's *Equity* podcast.

Larco pointed out that while enterprise clients have substantial budgets and are eager to deploy AI solutions, implementation often stalls because companies "don't know where to start."

"The interesting thing about consumer and prosumer tech products is that people already know exactly what they want to use them for," Larco continued. "Once a product meets that need, consumers will keep buying and using it."

In other words, consumer AI products can achieve market penetration much faster, sparing startups the guesswork of whether they have truly achieved product-market fit or merely secured a contract.

"If you're selling to consumers, you quickly find out if it resonates, and you can rapidly decide whether to pivot, refine the product, or abandon the current approach and start over," Larco added.

In today's uncertain economic climate, consumer tech products that manage to scale effectively demonstrate robust product-market fit.

There are already early signs that consumer tech is gaining momentum. Late last year, OpenAI introduced a suite of features for its ChatGPT chatbot, enabling users to shop directly via the Target app, search for properties on Zillow, book trips through Expedia, or create Spotify playlists—all from within ChatGPT.

"AI will deliver a concierge-like service that handles everything you want to do," Larco said. "The key question is, which functions require deep vertical specialization, and which should follow a generalist approach?"

From another perspective, as OpenAI works to position ChatGPT as the next-generation operating system for the consumer internet, which established companies like Tripadvisor and WebMD will survive independently, and which might be absorbed by OpenAI?

Although Larco predicts 2026 will see an "explosion" of mergers and acquisitions, she is more interested in investing in startups that "OpenAI wouldn't want to kill."

"OpenAI doesn't manage physical assets," she explained. "I don't think they would build a platform to compete with Airbnb, as they wouldn't want to manage countless properties. Similarly, they are unlikely to enter transaction platforms that require coordinating offline human labor, because they don't want the burden of managing people."

Beyond identifying which startups can fill market gaps, Larco is also closely watching another possibility: how the market would react if OpenAI "adopts a business model like Apple or Android, taking a 30% cut from all transactions routed through its platform."

"Would Airbnb still be willing to partner with them then?" she questioned.

Overall, Larco predicts that as online consumer experiences continue to evolve, entirely new monetization strategies and business models will emerge.

Social media must change.

Previously, while browsing Instagram for news about Trump's actions regarding Venezuelan President Nicolás Maduro, Larco encountered a problem. She had turned to the platform to understand the escalating crisis but found herself inundated with AI-generated misinformation about Maduro.

Although deepfake technology has been gradually proliferating on social media, this was a significant news event where AI-generated false information severely disrupted the truth.

"In that moment, I thought, if I'm going to see AI-generated videos and images, they should at least be interesting content," she said.

Larco noted that realistic AI-generated videos are now so commonplace on social media that she assumes everything she sees is AI-synthesized—and she's not alone in this feeling. If people eventually conclude that content on Meta's platforms and TikTok lacks any authenticity, a critical question arises: where should they go for real information?

Larco believes other platforms might fill this void by offering genuine, non-AI-generated content. For instance, social news sites like Reddit and Digg are already implementing user authenticity verification measures. As for Meta, it might fully transform into an entertainment company, becoming a platform for user-generated short videos.

"I don't think people should get their news from Meta's platforms anymore," Larco stated. "What you see there is just funny videos. They are no longer social media but pure gaming and entertainment platforms."

"In some scenarios, voice interaction is far more efficient than screen-based operation."

Last week, Meta acquired AI agent startup Manus, a move largely interpreted as an expansion into enterprise services. However, Larco suggests it might be aimed at enhancing its Ray-Ban smart glasses—a product she herself uses extensively. The glasses allow her to answer calls, reply to messages, take photos and videos, or query Meta's AI assistant without needing to pull out her phone or interact with a screen.

Larco stated that with more advanced technology and greater computational power, truly useful voice AI assistants are finally "on the verge of becoming a reality."

"In certain scenarios, voice interaction is far more efficient than screen-based operation," she noted. "In the past, due to poor voice technology, we had to rely on screens as a crutch. But going forward, we should delineate which functions are better suited for screens and which are superior via voice."

For example, when a child asks, "What is the tallest building in the world?" getting an answer via voice is quick and efficient. Pulling out a phone to type a search now seems "outdated," Larco remarked.

"I think this will be very interesting for designers because they can finally choose the most appropriate product form factor based on different usage scenarios."