Startups' share of enterprise AI application revenue
1What this measures
Share of enterprise generative-AI application revenue earned by startups rather than incumbents, from Menlo Ventures' annual buyer survey.
Why it matters. Whether incumbents with distribution keep the application layer or startups take it is the Teece question at the top of the stack; Menlo's survey is the only published split.
- Proxy types
- market_structure
- Unit
- share
- Cadence
- annual
2How we track this
- series
menlo.us_enterprise.startup_app_revenue_share.fy - source Menlo Ventures, State of Generative AI in the Enterprise · default tier 6 · Report
Direction over 1 periods, dead-band 5.0%; higher = dispersing.
Two annual waves, so the trend is one step; under five points is survey error. Rising startup share = value dispersing away from incumbents.
Applied to menlo.us_enterprise.startup_app_revenue_share.fy.
3Tracker interpretation
Startups went from a third of application revenue in 2024 to nearly two thirds in 2025 in Menlo's sample; one survey, so read as a direction.
4Evidence
Direction over the last 1 periods; the band is ±5.0% around the window's first point. Higher reads dispersing.
2 observations. Hollow points are disputed (see counterevidence). Every point links to its observation.
5Status and reasoning
Menlo Ventures' buyer survey: startups earned 36% of enterprise generative-AI application revenue in 2024 and 63% in 2025 (nearly $2 for every $1 earned by incumbents), a 27-point move against a five-point dead band, so the direction reads dispersing away from incumbents. Capped at emerging because Menlo is the only source and a survey is tier 6. Initial seed.
6Timeline notes
7Counterevidence
What cuts against this reading
One survey of buyers; revenue share is not margin share; incumbents' embedded AI features are excluded by Menlo's scope.
8Update history
- 2026-09-10unmeasured to emergingconf — → 50 · evaluate
Menlo Ventures' buyer survey: startups earned 36% of enterprise generative-AI application revenue in 2024 and 63% in 2025 (nearly $2 for every $1 earned by incumbents), a 27-point move against a five-point dead band, so the direction reads dispersing away from incumbents. Capped at emerging because Menlo is the only source and a survey is tier 6. Initial seed.
9Confidence
50 / 95 — mixed or hard to operationalise
Confidence is independent of status: 90–95 multiple strong independent sources; 70–89 good evidence, some ambiguity; 50–69 mixed or hard to operationalise; below 50 limited or vague.