As I was collecting Crystal Ball predictions for 2026 from readers, I found myself thinking a lot about the future of work. 

In part, of course, that’s because you all were thinking about it—combing through email after email, I found waves of predictions about how AI will change our workplaces and our jobs. And I sensed two things: An undercurrent of anxiety, and a resounding sense that AI is our now and future coworker. 

The anxiety may have been yours, readers, but it was perhaps mostly mine: I think it’s possible we’re moving towards a future where the most mundane tasks we humans have to do right now are taken over by agentic armies in a way that’s fundamentally good. Much as the Internet created new ways of working that have improved people’s lives, I’m hopeful that AI can too. But then, there’s part of me that says: No, we’re about to move into a world of relentless job contraction and depersonalized professional interactions, made more depressing by the fact they spring from craven laziness above all else.

All of this to say, I’m conflicted. And my ambivalence isn’t helped by the fact that Term Sheet readers—many of whom are investing in the technologies and startups that will shape tomorrow’s workplace—have divergent perspectives. Here’s a sampling of how readers are thinking about an issue that will only become more consequential going forward:

We will start hiring digital employees. We will start treating AI agents like junior staff with job titles, budgets, and spending limits. Once an agent can issue a refund or buy inventory, it stops being a tool and becomes a worker. —Cathy Gao, partner, Sapphire Ventures

You can now build digital autonomous workers that handle large portions of front-office work. We’re heading toward models and agents that can complete a full day’s worth of work with minimal or no human intervention, and we may already be there in some domains. —George Mathew, managing director, Insight Partners

In 2026, companies who rushed to make layoffs hoping AI would fill a significant gap will realize they need to re-hire to fill some of those roles. We saw this starting this year with companies like Klarna, re-hiring to fill customer service roles that chatbots failed at. Next year, we’ll see more of this. —Mahe Bayireddi, CEO and cofounder, Phenom

2025 made it clear that AI would shrink teams by carrying more of the workload. In 2026, the bigger shift will be who gets hired. Companies are increasingly pairing a small number of senior technical leaders with AI-fluent operators, often without traditional CS backgrounds. For VCs, this shift will redefine what a ‘strong early team’ looks like and how capital efficiency is priced. —Jiaona Zhang, CPO at Laurel

New grad hiring will continue to slow and niche talent, either for AI or specific backend infra, will be paid top dollar. As AI makes boilerplate programming table stakes, only great talent will be rewarded. Fewer people will want to major in Computer Science. —Deedy Das, partner, Menlo Ventures

The tensions around returning to the office in any form of mandated pattern are going to continue. While employers might argue it’s a hirer’s job market, if we have an exodus of talent it’s really hard to replace those skillsets. —Livia Bernardini, CEO, Future Platforms

The first real shockwave from AI won’t hit junior analysts; it’ll hit outsourcing. Anything that was being subcontracted to offshore hubs is up first, as AI takes over the repetitive, process-heavy work that used to justify those models. —Raj Bakhru, general manager and cofounder, Blueflame AI

Human judgment will stay at the heart of HR. While AI will streamline recruiting, compensation analysis, and enhance employee experience, humans will remain essential for interpreting nuance, intent and values. HR functions will evolve toward augmented intelligence. —Niki Armstrong, chief administrative and legal officer, Pure Storage

In 2026, agentic AI moves from copilots to autonomous operators. Agentic systems will handle entire workflows, turning automation into a competitive weapon. —Diane Yu, cofounder, Tidalwave

We will see companies and consumers ‘hire’ AI agents to act on their behalf. 2026 will be the year society adjusts to the new realities of AI agents and focuses on what guardrails we expect from the companies behind them. —Don Butler, managing director, Thomvest Ventures

The Term Sheet Podcast is back!… Our first episode of 2026 just dropped. My guest: Jenny Xiao, founder of Leonis Capital and former OpenAI researcher. She talks about why AI companies should be valued closer to (or even below) SaaS, the role academia plays in AI progress, the possibility of another “DeepSeek” moment, and more. Listen and watch here.

See you tomorrow, 

Allie Garfinkle
X: @agarfinks
Email: alexandra.garfinkle@fortune.com
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Joey Abrams curated the deals section of today’s newsletter. Subscribe here.

VENTURE CAPITAL

- Onebrief, a Honolulu, Hawaii-based operating system for the military, raised $200 million in Series D funding. Battery Ventures and Sapphire Ventures led the round and were joined by Salesforce Ventures and others.

- JetZero, the Long Beach, Calif.-based designer of the world’s first all-wing airplane, raised $175 million in Series B funding. B Capital led the round and was joined by United Airlines Ventures, Northrop Grumman, and others.

- Proxima, a New York City-based AI-powered drug discovery platform for proximity therapeutics, raised $80 million in seed funding. DCVC led the round and was joined by NVentures, Braidwell, Roivant, AIX Ventures, and others.

- Wasabi Technologies, a Boston, Mass.-based cloud storage company, raised $70 million in funding. L2 Point Management led the round and was joined by Pure Storage and existing investors.

- WitnessAI, a Mountain View, Calif.-based AI security platform, raised $58 million in funding. Sound Ventures led the round and was joined by Fin Capital, Qualcomm Ventures, Samsung Ventures, and Forgepoint Capital Partners.

- WithCoverage, a New York City-based AI-powered risk management platform designed to replace insurance brokers for businesses, raised $42 million in Series B funding. Sequoia Capital and Khosla Ventures led the round and were joined by 8VC and Crystal Venture Partners.

- Flip, a New York City-based developer of an AI program that automates customer service calls, raised $20 million in Series A funding. Next Coast Ventures and Ridge Ventures led the round and were joined by Data Point Capital and others.

- Tive, a Boston, Mass.-based developer of supply chain and logistics visibility technology, raised $20 million in funding. Lightsmith Group led the round and was joined by Sageview Capital, World Innovation Lab, AVP, and Supply Chain Ventures.

- Klearly, an Amsterdam, The Netherlands-based payment acceptance platform for small and medium-sized businesses, raised €12 million ($14 million) in Series A funding. PayPal Ventures led the round and was joined by Italian Founders Fund and existing investors.

- RISA Labs, a Palo Alto, Calif.-based developer of an AI operating system designed for oncology, raised $11.1 million in Series A funding. Cencora Ventures and Optum Ventures led the round and were joined by others.

- OurPetPolicy, a Boise, Idaho-based pet and emotional support animal platform for rental properties, raised $8 million in Series A funding. RET Ventures led the round and was joined by StageDotO and Capital Eleven.

- GrowthPal, a New York City-based developer of an AI copilot designed for M&A, raised $2.6 million in funding. Ideaspring Capital led the round and was joined by angel investors.

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PRIVATE EQUITY

- Arlington Capital Partners acquired Pond & Company, an Atlanta, Ga.-based consulting firm for engineering, architecture, planning, and construction management. Financial terms were not disclosed.

- Platinum Equity acquired a majority stake in Norton Packaging, a Hayward, Calif.-based plastic pails and packaging company. Financial terms were not disclosed.

- WindRose Health Investors acquired a majority stake in Avalon Healthcare Solutions, a Tampa, Fla.-based health diagnostics platform. Financial terms were not disclosed.

EXITS

- Aurex, backed by Godspeed Capital, acquired Alpha 2, a Chantilly, Va.-based provider of cryptographic engineering, cybersecurity, and engineering services. Financial terms were not disclosed.

- Investindustrial acquired Proveris, a Hudson, Mass.-based designer and manufacturer of spray and aerosol testing instrumentation, software and laboratory solutions for the pharmaceutical industry. Financial terms were not disclosed.

- MPearlRock acquired The Good Crisp Company, a Boulder, Colo.-based healthy snack company. Financial terms were not disclosed.

- O’Hara’s Son Roofing, a portfolio company of Angeles Equity Partners, acquired CP Rankin, a Chalfont, Pa.-based roofing company. Financial terms were not disclosed.

- PrimeSource Brands, backed by Clearlake Capital Group, acquired Advantage Industries, a Deerfield Beach, Fla.-based gate hardware and pool safety solutions manufacturer. Financial terms were not disclosed. 

- TruArc Partners acquired Schill Grounds Management, a Westlake, Ohio-based commercial landscaping company, from Argonne Capital Group. Financial terms were not disclosed.

- Turn/River Capital acquired StarLIMS, a Hollywood, Fla.-based informatics platform for laboratories, from Francisco Partners. Financial terms were not disclosed.

- Valor Exterior Partners, a portfolio company of Osceola Capital, acquired Landmark Exteriors, a Norwalk, Conn.-based roofing company. Financial terms were not disclosed.

PEOPLE

- Bregal Investments, a London, U.K.-based private equity firm, promoted Jens Brenninkmeyer to CEO. 

- Garnett Station Partners, a New York City-based private equity firm, promoted Rafi Haramati to managing director, Bradley Ezratty to principal, Max Hoberman to principal, and Teddy Sokoloff to vice president.

- M13, a Santa Monica, Calif.-based venture capital firm, promoted Morgan Blumberg to partner.

- Periscope Equity, a Chicago, Ill.-based private equity firm, promoted Luke Elder to principal and Harry Waddoups to vice president.