While information and communications technology (ICT) accounted for the bulk (62,7%) of all southern African venture capital (VC) deals in 2025, artificial intelligence (AI) and machine learning represented just 1,6% of deals as a standalone category.
This figure, however, understates AI’s influence, as the technology increasingly permeates every part of the investment landscape. As Stephen Lamprecht, founder of VS Nova and research partner on the SAVCA’s 2026 Venture Capital Industry Survey, notes, AI is increasingly embedded across sectors rather than being confined to a standalone investment category.
“AI is everywhere,” says Lamprecht. “It’s part of every sector and every industry, whether that’s healthcare, financial services, agriculture or ICT itself. We can no longer treat AI as a separate category because increasingly it’s being absorbed into the application areas where it creates value. The real story is not about standalone AI companies, but about how AI is enabling innovation across the economy.”
The implications of this shift for investors were explored further during SAVCA’s recent VC Conference, where Jason Goldberg, co-founder of Edge Growth and author of The Art of Scale, delivered a keynote titled AI and the New Scale Advantage.
Goldberg argues that many organisations continue to underestimate the scale of change AI is likely to bring. “Many people think AI is a fun tool to write emails faster, create slide decks or improve productivity. But it is much more than that. AI is a general-purpose technology, like the steam engine, electricity or the internet. It changes what becomes possible.”
Drawing on examples ranging from ChatGPT to the rise of Netflix and Nvidia, Goldberg says the biggest risk facing business leaders and investors today is evaluating an exponential technology through a linear lens.
“When the curve is exponential and your paradigm is linear, that’s when you lose,” he says. “The companies that thrive are the ones that recognise how quickly the economics of an industry can change when a new technology fundamentally alters what is possible.”
Goldberg believes AI is doing for expertise and problem-solving what electricity did for energy: making something that was once scarce, expensive and difficult to access increasingly abundant and widely available. “The difficulty of solving complex problems is what AI is fundamentally disrupting.”
For VC investors, this has profound implications. Rather than simply asking whether a company uses AI, Goldberg suggests investors adopt a different lens, understanding whether AI makes a company’s offering more valuable or less valuable over time. “As investors, the key question is simple: what becomes more valuable as AI gets better, and what becomes less valuable as AI gets better?”
He points to the sharp decline in valuations across parts of the software sector as an example. Historically, building sophisticated software required highly specialised skills, large development teams and significant capital. Today, many of those barriers are falling rapidly as AI makes software development faster, cheaper and more accessible.
“AI is making some things that used to be hard, expensive and valuable become cheap and easy. That’s a primary lens we need to apply as investors.”
At the same time, entirely new categories of investment opportunities are beginning to emerge. One area Goldberg highlights is the rise of AI-native services businesses, where expertise can be embedded into agentic systems and delivered at a fraction of the cost, time and complexity previously required.
“For years, venture investors largely avoided professional services businesses because they were difficult to scale,” he says. “Today, expertise itself can increasingly be embedded into systems that deliver high-value outcomes faster, more consistently and at significantly lower cost. That fundamentally changes the economics of those businesses.”
This shift is creating what Goldberg describes as a “new scale advantage”, where organisations can access capabilities that were previously constrained by the availability of specialised talent, management capacity or institutional knowledge.
For South Africa’s VC ecosystem, the shift away from AI as a standalone category mirrors more mature markets. As Lamprecht notes, the future of AI investing is unlikely to be defined by businesses that simply call themselves AI companies. Rather, it will be shaped by businesses using AI to unlock new efficiencies, solve problems in fundamentally different ways and create value across every sector of the economy.
In that sense, AI’s relatively small share of VC deals may be one of the most telling statistics of all. “Its influence has grown so pervasive that it is increasingly disappearing as a category altogether, becoming embedded in the technologies, products and business models that will shape the next generation of venture-backed growth companies,” concludes Lamprecht.