Unlike traditional firms retrofitting AI into existing workflows, AI-native startups are built around AI from day one, designing products, infrastructure and business models that inherently leverage its capabilities. And the sector is hot right now.
This year, 27 companies in Sifted’s B2B SaaS Rising 100 list fall under the new category of AI-native, taking the top nine spots in the ranking. The top six companies are first-time entrants to the list.
“We think of the AI-native [subsector] as companies that have AI right at their foundation,” says Andreas Weiskam, partner at Sapphire Ventures, co-sponsors of the report. “We actually think of AI not so much as a new vertical per se, but more like a new foundational technology.”
The impact of this technology, he adds, is likely to define this era of innovation.
“We had mainframe and then PC, and then Internet, and then mobile and then Cloud,” he says. “AI is the next thing. We believe that AI will be at the core of most, if not all, software technology companies going forward.”
Changing the game
Jan Oberhauser, founder and CEO of Berlin-based workflow automation platform N8n, which came in number four on the Rising 100, believes this shift requires a change in mindset.
“For us, being AI-native starts with a belief: that human intelligence should stay at the centre of how we build, decide and work,” he says. “Being AI-native isn’t about adding smart features, it’s about rethinking the entire approach to how systems operate with intelligence at their core.”
Oberhauser says that being AI-native allowed N8n to quickly unlock new potential.
We chose AI-native from day one because bolting AI onto a traditional stack creates hidden drag.
“Today, N8n users can create agentic systems visually and handle complex, multi-step AI agents that work with their own data and models,” he says. “This simply isn't possible when AI is just bolted on as an afterthought.”
Accessing fresh possibilities is also an opportunity that Tacto, a Munich-based supply chain and procurement platform which came in seventh on the Rising 100, has realised.
“Starting out AI-native frees us from legacy constraints,” says CEO and founder André Petry. “Traditional procurement tools were built around static forms and workflows, so re-engineering them for autonomous agents and real-time data is almost impossible. Because our stack puts AI first, a small team can ship features and deliver results significantly faster than incumbents 10 times our size.”
For Paris-based AI compute software company FlexAI, third on the Rising 100, being AI-native has reduced the friction of rapid growth.
“We chose AI-native from day one because bolting AI onto a traditional stack creates hidden drag. Instead, the use of AI is how companies can enable rapid iterations and efficiencies that help us internally, but also improve our customers’ operations,” says COO Sundar Balasubramaniam.
Weiskam says that AI-native startups circumvent the barrier that bigger incumbents face when trying to change a legacy tech stack or company.
“We all know it's hard to change culture within a company once it has been going for a couple of years, and then just bolting on AI on the side and saying, ‘now we are AI’ doesn't necessarily work,” he says.
Guy Podjarny, founder and CEO at London-based software development platform Tessl, which placed second on the Rising 100, agrees.
“Organisations get value from using AI to automate current workflows, but to tap into its true potential, you need to change the way you work — often in ways that conflict with today's tried and true approaches,” he says. “As a startup, we have the benefit of not having old established practices, and optimise directly for the AI-fuelled world.”
VC appetite for AI-native companies
Investors are already keen on AI — but Weiskam says that AI-native startups offer an even better proposition.
“The numbers are an investor's dream, because the value proposition is often so clear,” he says. “It's often not incremental like 10% better or 20% better: it’s orders of magnitude, like 10x better.”
Startups have already noted investor enthusiasm.
“The response has been incredible for N8n,” says Oberhauser. “VCs are definitely keen on AI-native companies, but they're looking for practical applications, not just hype. The key is showing real traction and solving actual problems.”
But as more investors look towards this sector, the bar is rising.
The numbers are an investor's dream, because the value proposition is often so clear.
“Investor interest is strong, but since the 2023 hype wave, VCs look more closely at the fundamentals,” says Petry. “They want to see proprietary tech rather than generic LLM wrappers, and a clear customer value leading to strong growth instead of just nice visions.”
Startups in this space recognise that they’re at the forefront of a wave — and many predict that progression will be rapid.
“AI-native will be table stakes in five years or less. AI will become a ubiquitous layer, like databases or microservices are today,” says Balasubramania.
“AI is so powerful that VCs (and myself) believe it will transform how organisations work, and therefore the tools they need,” adds Podjarny. “This will create substantial disruption opportunities, primed for fast moving startups to seize.”
For Weiskam, this all proves that we sit at the start of a new wave.
“I would be surprised if more than half of the companies in the B2B 100 list weren’t AI-native next year. Eventually, all of them will be AI-driven,” he says.
He predicts that the stakes will be high: “Some companies will be AI-native and build with AI in mind from the get-go, others will adjust and integrate it, and others will not be able to do that and will go away.”
Discover the ultimate B2B SaaS startup full list here and download the report here.
