IT entrepreneur Serhii Tokarev explains why vertical AI is worth investors’ attention
Vertical artificial intelligence is considered one of the most promising areas because it is adapted to address clearly defined tasks within particular industries. The founder of the Tokarev Foundation and investor Serhii Tokarev is confident that in the next few years, it is precisely such highly specialised solutions that will generate most of the value in the AI market.
‘Vertical AI performs tasks in specific industries, which is why it attracts the interest of many venture capital funds. Horizontal AI, on the other hand, is more general-purpose. As basic models evolve, many of these tools become obsolete and unnecessary,’ says the investor.
In 2025, approximately 60% of investments directed towards AI technologies went to large AI labs. 90% of this capital went to mega-rounds of a small group of companies. This creates difficulties for most venture capital funds in the process of creating a repeatable strategy.
What makes vertical AI promising
Unlike horizontal AI, vertical AI attracts capital across different industries and creates competitive barriers by integrating such solutions into customers’ operational processes.
Serhii Tokarev names three areas where this technology has demonstrated good results:
- In the procurement sector, a separate niche is emerging for small and medium-sized businesses – instead of cumbersome ERP systems, companies can use new AI services with decision support and smart planning.
- The legal sector is developing tools that address a wide range of challenges in litigation, business services and intellectual property – from case analysis and automation of checks to patent searches and contract preparation.
- In the field of finance, accounting and auditing solutions that significantly simplify and speed up work are gaining popularity among investors. An example is the start-up Kobalt Labs from the Roosh Ventures portfolio.
‘I am confident that the next 2-3 years will determine the leaders in the vertical AI category, as horizontal artificial intelligence is not adapting fast enough and the existing players are too slow,’ says the founder of the Tokarev Foundation.
Eventually, such tools will become mandatory for the legal, procurement and financial sectors. This will increase the cost of changing suppliers, and markets will quickly consolidate. Today, venture investors see vertical AI as perhaps the only niche where everything is determined by the depth of expertise rather than the scale of capital.
