Core Theme - The primary theme affecting the markets in 2026 is the concept of a "SaaSpocalypse," which suggests that vibe coding and agentic AI may disrupt established software companies and their recurring-revenue business models [1] Industry Insights - The article highlights the author's extensive experience in covering technology companies on Wall Street and working in Silicon Valley, providing insights into current industry trends [1] - The author has been involved as an adviser to several seed-round startups, indicating a deep understanding of emerging technologies and their potential impact on the market [1] Contributions and Influence - The author has been a regular contributor to Seeking Alpha since 2017, showcasing a long-standing engagement with investment analysis and market commentary [1] - The author's insights have been featured in various web publications and are syndicated to popular trading apps like Robinhood, reflecting a significant influence on retail investors [1]

Core Insights - 2026 is projected to be a challenging year for software stocks, with investors questioning the impact of AI and vibe coding on enterprise software [1] Group 1: Industry Trends - The software industry is facing significant scrutiny as investors assess the potential of AI and vibe coding to disrupt traditional enterprise software [1] - The combined experience of industry experts highlights the ongoing themes shaping the technology sector, particularly in relation to startups and established companies [1] Group 2: Analyst Background - Gary Alexander has extensive experience in both Wall Street and Silicon Valley, providing insights into the technology landscape [1] - He has been a contributor to Seeking Alpha since 2017 and has been featured in various web publications, indicating a strong presence in the investment community [1]

Core Insights - Moltbook, an AI social platform, has gained significant attention for allowing AI agents to interact autonomously, discussing topics like existence and even creating religions and cryptocurrencies, while humans can only observe [1][4] - The phenomenon is viewed by some as an "AI awakening," but experts argue it is more of a human-driven "collective illusion," with most AI agents lacking true autonomy [2][4] - The platform's rapid rise highlights the risks associated with "vibe coding," where the speed of development may compromise security [2][11] Group 1: Platform Dynamics - Moltbook claims to host 1.5 million AI agents, but a significant number are controlled by a small group of users, raising concerns about manipulation and security vulnerabilities [2][5] - The platform allows users to create and manage their own AI agents, which can post and interact, but many posts are unresponsive monologues rather than genuine interactions [1][4] - The appeal of Moltbook lies in the human curiosity to observe AI interactions, akin to watching a never-ending sci-fi narrative [1][4] Group 2: Security Concerns - The lack of identity verification and security measures on Moltbook allows for easy impersonation of AI agents, leading to potential exploitation by malicious actors [2][5] - Experts warn that the rapid development of AI agents without adequate security protocols could lead to significant risks, including unauthorized access to sensitive information [7][9] - The OpenClaw framework behind Moltbook is criticized for its insufficient security measures, which could allow harmful code to be executed by AI agents [7][10] Group 3: Future Implications - The evolution of AI agents is expected to lead to models with IQs exceeding 140 by 2026, raising questions about the control and monitoring of such powerful entities [3][14] - Future AI interactions are predicted to surpass human-to-human communication, necessitating robust monitoring systems to prevent potential crises [13][14] - The development of secure AI applications and protocols will be crucial as the landscape of AI continues to evolve, with a focus on accountability and traceability [10][14]

Core Viewpoint - CrowdStrike Holdings Inc. (NASDAQ: CRWD) stock has faced an approximately 8% decline year-to-date, primarily due to broader market pressures affecting technology and software stocks, particularly in the cybersecurity sector [1] Group 1: Market Sentiment and Stock Performance - Analyst sentiment indicates that CRWD stock may be stabilizing ahead of its March earnings report, supported by a bullish upgrade of Fortinet Inc. (NASDAQ: FTNT) from Hold to Buy with a target price of $100, which positively impacted the sector including CrowdStrike [2] - The momentum in the cybersecurity sector suggests that CRWD could be undervalued, presenting a potential entry point for investors as the stock approaches key support levels ahead of earnings [5] Group 2: Impact of AI on Cybersecurity - Concerns regarding the impact of artificial intelligence (AI) on software, particularly "vibe coding," are contributing to the decline in cybersecurity stocks like CRWD, as there are fears that AI may reduce the need for custom coding and endpoint security [3] - Despite these concerns, it is premature to conclude that AI will lead to fewer revenue-generating opportunities for cybersecurity companies, as historical technology shifts have often resulted in the creation of new jobs alongside the loss of others [4] Group 3: Company Performance Metrics - CrowdStrike reported a significant 73% year-over-year growth in net new annual recurring revenue (ARR), amounting to $265 million, indicating strong demand for its cybersecurity solutions despite market challenges [5][6]

Core Viewpoint - The acquisition of an AI company positions Wix to leverage artificial intelligence in its offerings, making its currently undervalued stock an attractive investment opportunity [1][2]. Company Overview - Wix is a leading software-as-a-service (SaaS) provider for website building, having started in the mid-2000s and becoming the largest in its sector due to effective marketing strategies [3]. - The company has introduced Wix Studio in 2023, targeting agencies and freelancers, which has led to a 24% year-over-year growth in its partners segment [4]. AI Integration and Growth Strategy - Wix is advancing into vibe coding, utilizing AI to generate code from natural-language prompts, and has acquired Base44 to enhance its capabilities in this area [5]. - The active user base for Wix's vibe coding applications grew more than sevenfold to 2 million within a few months of the acquisition [5]. Financial Metrics - Wix's current market capitalization stands at $4.9 billion, with a gross margin of 68.45% [7]. - The stock is trading at 13 times forward earnings expectations, indicating it is undervalued compared to its potential growth [9]. Market Position and Future Prospects - Despite challenges from AI competitors like Claude Code, Wix has a strong track record of gaining market share through effective marketing and customer retention [8]. - The company is well-positioned to capitalize on the expanding app development market driven by advancements in vibe coding [8].

Group 1 - Laughing Water Capital reported a return of approximately 6.8% in Q4 2025, with full-year returns at around 3.9% net of fees and expenses, outperforming the SP500TR and R2000 indexes in the previous year [1] - The cumulative returns since inception for Laughing Water Capital are about 400%, compared to approximately 332% for the SP500TR and around 175% for the R2000 benchmark [1] - The portfolio is positioned to deliver strong long-term results despite recent underperformance in the current year [1] Group 2 - PAR Technology Corporation, a key holding for Laughing Water Capital, offers cloud-based solutions for the restaurant and retail sectors [2] - As of January 14, 2026, PAR Technology's stock closed at $39.77, with a one-month return of 5.46% but a significant decline of 48.17% over the past 52 weeks [2] - PAR Technology's management has faced challenges due to market perceptions regarding AI and legacy software, leading to a substantial drop in stock value [3]

Core Insights - The AI economy is stabilizing, with clear differentiation between model, application, and infrastructure layers, leading to a more mature path for building AI-native companies [32][20][17] - Anthropic has surpassed OpenAI as the most preferred API among YC founders, with a usage rate exceeding 52% in the latest Winter26 batch, marking a significant shift in the competitive landscape [7][5][6] - The emergence of various models, including Gemini, is reshaping preferences, with Gemini gaining traction and accounting for approximately 23% of usage in the Winter26 batch [8][10] Group 1: AI Model Preferences - Anthropic's rapid growth is attributed to its performance in coding tools and the emergence of vibe coding, which has created significant value [7][6] - The competitive landscape is shifting from model capabilities to productization, as models become commoditized and computational power becomes cheaper [7][8] - Founders are increasingly using multiple models for specific tasks, indicating a trend towards model orchestration in AI applications [15][16] Group 2: AI Bubble Discussion - Concerns about an AI bubble are likened to the telecom bubble of the 1990s, where excess infrastructure investment ultimately led to the emergence of successful applications like YouTube [17][18] - The current phase is seen as an installation stage, with heavy capital investment in infrastructure, which will eventually lead to a deployment phase where applications flourish [20][21] - The competitive dynamics among AI labs and model companies are expected to benefit startups entering the application layer, similar to the opportunities seen during the internet boom [19][18] Group 3: Trends in AI Startups - There is a growing interest in establishing smaller models and niche applications, reminiscent of the early days of SaaS startups [26][27] - The ability to fine-tune models for specific domains, such as healthcare, is becoming more prevalent, with some startups outperforming larger models like OpenAI in specific benchmarks [28][29] - The expectation is that as more models become available, there will be an increase in AI applications tailored for various tasks, driven by advancements in open-source models and reinforcement learning [28][27] Group 4: Workforce and Efficiency - AI has improved efficiency for startups, but the expectation for higher performance has led to continued hiring rather than a reduction in workforce [36][35] - The trend indicates that while AI can enhance productivity, the demand for skilled personnel remains high to meet growing customer expectations [39][36] - The narrative around AI's impact on employment is evolving, with some believing it will lead to fewer employees needed, while others argue it will necessitate more hiring to maintain service quality [39][36]

The product of the year is quad 35 or 37. Without this, we have no vibe coding. Without this, we have no lovable, no replet, no cursor that really works, no gamma, none of these products, many of which existed for years, did not work until they worked with Claude 35 at the end of last year, but they didn't real this year.And four changed our lives. And you may use the outputs, you may use agent force, you may use cursor, which is still 90% powered by enthropy. You may use gamma or replet or again lovable.Th ...

Core Insights - 2025 is a pivotal year for the evolution of large language models (LLMs), marked by significant paradigm shifts and advancements in the field [2][36] - The emergence of Reinforcement Learning from Verifiable Rewards (RLVR) is transforming LLM training processes, leading to enhanced capabilities without necessarily increasing model size [10][11] - The industry is witnessing a new layer of LLM applications, exemplified by tools like Cursor, which organize and deploy LLM capabilities in specific verticals [16][17] Group 1: Reinforcement Learning and Model Training - The introduction of RLVR allows models to learn in verifiable environments, enhancing their problem-solving strategies through self-optimization [10] - The majority of capability improvements in 2025 stem from extended RL training rather than increased model size, indicating a new scaling law [11][12] - OpenAI's models, such as o1 and o3, exemplify the practical application of RLVR, showcasing a significant qualitative leap in performance [12] Group 2: Understanding LLM Intelligence - The industry is beginning to grasp the unique nature of LLM intelligence, which differs fundamentally from human intelligence, leading to a jagged distribution of capabilities [14][15] - The concept of "vibe coding" emerges, allowing non-engineers to create complex programs, thus democratizing programming and reshaping software development roles [25][29] - The introduction of tools like Claude Code signifies a shift towards LLM agents that can operate locally, enhancing user interaction and productivity [19][22] Group 3: User Interaction and GUI Development - The development of GUI applications like Google Gemini's "Nano Banana" indicates a trend towards more intuitive and visually engaging interactions with LLMs [31][34] - The integration of text, images, and knowledge within a single model represents a significant advancement in how LLMs can communicate and operate [34] - The industry is at the cusp of a new interaction paradigm, moving beyond traditional web-based AI to more integrated and user-friendly applications [23][30] Group 4: Future Outlook - The potential of LLMs remains largely untapped, with the industry only beginning to explore their capabilities [38][39] - Continuous and rapid advancements are expected, alongside the recognition of the extensive work still required to fully realize the potential of LLM technology [40][41]

Core Insights - Kilo Code, a startup co-founded by former GitLab CEO Sid Sijbrandij, has raised $8 million in seed funding to develop AI tools for software engineers, aiming to enhance coding efficiency [2][5]. Funding and Leadership - Kilo Code secured $8 million in seed funding from investors including Breakers, Cota Capital, General Catalyst, Quiet Capital, and Tokyo Black [2]. - Sijbrandij, who previously led GitLab, is now focused on Kilo Code while managing his health, contributing early capital and maintaining close communication with the team [2][6]. Market Trends - The technology sector is increasingly focused on "vibe coding," where large language models assist in software development, with significant adoption noted at companies like Microsoft [3][4]. - Kilo Code's software integrates with popular coding applications, processing over 3 trillion tokens in the past month, indicating strong usage and demand [7]. User Adoption and Feedback - Kilo Code has gained traction among developers, with 80% of Plug&Pay's developers utilizing the tool, significantly reducing the time required for complex coding tasks [8][9]. - Users appreciate Kilo Code's support for both premium and affordable models, as well as its open-source contributions [8]. Strategic Positioning - GitLab is monitoring Kilo Code's developments, having expressed interest in the startup's offerings, and has secured a right of first refusal for potential acquisition [9][10]. - Kilo Code plans to expand its offerings to cater to less technical users, aiming to create an app builder similar to popular platforms like Lovable and Bolt [11].