The HumanX 2026 Conference at Moscone Center was buzzing—double the attendees from last year’s show in Las Vegas (3,500 to 7,800), and seemingly triple everything else—space, exhibitors, sponsors, and speakers. Unchanged was the excitement, hype, insight, promise, concern, and investment opportunity around AI and machine learning—all continued to be as high as the Artemis 2 capsule, which happened to be circling the moon during the show.
Huge investment capital continues to pour-in to the AI value stack from bottom to top—energy, infrastructure, foundational models, applications. Commercial traction is more active at the bottom of the stack than at the top. In the application layer where the most value is expected to eventually accrue, commercial deployments seem to be mostly early, with some companies already seeing fast growth, and others still building in stealth and preparing to launch—which points to high potential.
Some quick hits from Human[X] 2026:
- Capex, venture, and R&D investment across AI is expected to hit $1.6 trillion in 2026 alone, up 45% from $1.1 trillion in 2025. To put that in perspective—only 15 of 218 countries on the planet have GDPs that are greater than $1.6 trillion—and not a single country is growing at 45%.
- 1 billion down, 5 billion to go – At the same time, the industry is still nascent—only 1 in 6 global internet users had tried an LLM as of Jan 2026. The foundational models are booming – with Anthropic announcing $30B ARR during the conference, just above OpenAI’s announced $25B in January—and growth continues unabated.
- Claude is hot – Anthropic is winning in the enterprise where token revenue is highest; OpenAI is dominating consumer. Claude is also outperforming OpenAI on coding accuracy (~95% to ~85%).
- More CEOs and boards are talking about becoming AI-first – but few have fully committed to retooling their organizations. Most enterprises remain early in the adoption cycle, with AI still treated as a line item in the IT budget. That said, sentiment is shifting—leaders seem to increasingly believe this time is different when it comes to deploying AI across the enterprise.
- Still plenty of hype – “There will be two kinds of companies in the future—ones that are fluent in AI and ones that are not—and there will be a 50x difference between the two.” Jeetu Patel, Cisco’s President & CPO. Not surprising to hear from a seller of AI products and services. And he may be right.
- Stopping the enterprise data hemorrhage – “Employees at most enterprises are hemorrhaging their companies’ data to LLMs. Management teams need to fix this. The more you or your company shares with these LLMs, the more at risk you are for this data to be sold to the highest bidder by the foundational model companies.“ – Tom Eggemeier, CEO of Zendesk.
- Manage tokens & operate profitably – Tokens are getting cheaper, but usage is exploding. “The token bill is growing—sometimes agents get stuck in a loop and rack up tens of thousands of dollars of token costs. Companies need to be on top of it.” – Kevin Kiley, CEO of Airia, an enterprise monitoring and governance company that has grown to over 500 F2000 customers in just 16 months.
- Agents are evolving – “Agents will evolve—they will move to the edge like to your phone or other device, and using your personal and situational context they will tell you what to do next in a given situation.” – Sanchit Garg, CEO of Zime AI
- Spatial intelligence is the next frontier – “AI’s next frontier is spatial intelligence. AI’s ability to perceive, reason about, and interact with the 3D world—is the scaffolding upon which human cognition is built. Spatial intelligence will transform how we create and interact with real and virtual worlds—revolutionizing storytelling, creativity, robotics, scientific discovery, and beyond.” – Dr. Fei-Fei Li, Stanford
- AI/AGI will be in your brain – “AGI is going to happen—latest in 2029. Your AI is not going to be something you carry around with you. It will be part of you. It will be in your brain. In the 2030s – without surgery. It will be inseparable.” – Ray Kurzweil
- Designing emotion into AI – “Designers need to build-in empathy into AI products. AI doesn’t know pain, pleasure, frustration. Our job as designers is to capture those emotions and bring those forward in AI products.” – Robert Brunner, CEO of Ammunition Group and former Head of Industrial Design at Apple
- Humanity’s place in the AI future – “I believe human instinct, creativity and judgement will ensure that humans have a place in the future AI world. For example, what you don’t write is sometimes more important than what you do write. Humans can make that judgement.” – Jeetu Patel, Cisco President and CPO
- Your AI twin – “I see a day not far in the future where an “AI Twin” will be invented, which is essentially a duplicate of myself.” – Sanchit Garg, CEO of Zime AI
In addition to big opportunity, there was also plenty of dialogue around AI safety, big doom, and disruption. The news about the hacking capability of Claude Mythos came out on day one of Human[X]. There was plenty of talk about job disruption. Virtually all acknowledged the need for good governance, regulation, and guardrails. Virtually all agreed that since AI has such a high growth rate, this needs to come soon. Many felt that the industry, governments and individual users will figure it out—but there will be displacement and unfortunate accidents along the way. Somehow we’ve survived as a species since the atom was first split some 80+ years ago. The AI future is inevitable and unstoppable; time will tell.
M&A in AI
As of April 2026, Pitchbook lists some 55,000 funding rounds for 79,000 AI startups in the last five years. In 2025, there were 1,407 completed M&A deals in “Machine Learning and AI”, up +40% from 1,004 in 2024.
The number of AI-related M&A transactions will continue to grow and likely eclipse 2,000 completed deals in 2026-2027 in a dynamic M&A market. We believe that the application layer will be the most dynamic for AI companies, as it is still the youngest layer with the greatest number of companies. Industry consolidation will fuel deals over the longer run, with larger transactions expected as the industry matures in 5-7 years.
The 2026 M&A market will see challenges around deal pricing. The companies achieving greatest traction generally won’t be coming to the M&A market until their growth trajectory begins to mature—which might be pre or post IPO. But for the AI companies that do come to the M&A market in 2026, shareholders of selling companies will tend to look backwards at their most recently-priced (expensive) rounds and seek outsized valuations; buyers of companies will look at commercial traction, market realities and equity valuations – and seek lower valuations. Sellers and buyers will need to find ways to bridge that gap.
An additional factor – which is new to the market – will play into M&A valuations. That is, the “acquire versus build” calculation that buyers traditionally make has changed dramatically with the advent of AI coding. Before AI, it might take 12-18 months to “build”; in the age of AI coding, it might only take days or weeks to “build”. This has the potential to kill many potential transactions.
Exciting times—more to come. Please be in touch if you’re considering strategic/financial outcomes for your company. We’re a team of 30 investment bankers celebrating our 25th year, $10 billion transaction value, and 500+ successful engagements. It would be our honor to help you.
Kelly Porter
Lead Managing Partner
Woodside Capital Partners
Kelly.Porter@woodsidecap.com
Woodside Capital Partners is a leading corporate finance advisory firm for tech companies in M&A and financings in the $30M –$500M enterprise value segment. The firm has worked with extraordinary entrepreneurs and investors since 2001, providing ultra-personalized service to its clients. Our team has global vision and reach, and has completed hundreds of successful engagements. We have deep industry knowledge and extensive domain and transaction experience in these and other sectors: Artificial Intelligence, CyberSecurity, HR Tech, Digital Advertising and Marketing, Autonomous Vehicles, ADAS, Computer Vision, Aerospace and Defense, CloudTech, Enterprise Software, IT Services, Information Security, FinTech, Internet of Things, Networking / Infrastructure, Robotics, Semiconductors, Quantum, Energy Storage, Digital Health & Virtual Care, Diagnostic, Medical Devices & Precision Medicine, Healthcare IT & Data Analytics Platforms, AI & Automation in Clinical Decision Support, Revenue Cycle Management & Financial Ops, Behavioral & Mental Health Tech, Value-Based Care & Preventive/Wellness Platforms, Healthcare Infrastructure & Cybersecurity. Woodside Capital Partners is a specialist in cross-border transactions, and has extensive relationships among venture capitalists, private equity investors, and corporate executives from Global 1000 companies. More about Woodside Capital Partners here.