AI was supposed to make domain expertise optional.

The data says it's making domain expertise mandatory.

We analyzed 673 vertical startups that raised $15M+ in 2025. In Vertical AI:

1) 71% of funded founders had prior industry experience.

2) Those founders raised 2.25x larger rounds than outsiders.

3) At $100M+, nearly three in four had domain backgrounds.

The gap isn't closing — it's widening.

And it's wider in AI than in SaaS.

The reason is structural: Vertical SaaS digitizes a workflow. Vertical AI automates judgment. When the product is the judgment itself, you can't iterate your way to trust.

Everything in the stack is getting cheaper and more accessible…

Except knowing what to build, for whom & why they'll believe you.

euclid.substack.com/p/n…