Today, our team is very happy to share that we’ve raised Haystack VIII, an $85M early stage fund and Needles III, a select fund for high conviction opportunities. These new vehicles represent a meaningful step up in our ability to back outlier founders at the very beginning of their respective journeys. They enable our small, focused team to carry forward the same model of making seed and early stage investments with more firepower to lead rounds and support our portfolio as companies scale.

Through our history, Haystack has constantly adapted and partnered with founders who have gone on to build market leaders in consumer (DoorDash, Instacart), cloud / SaaS (Figma, HashiCorp), autonomy (Applied Intuition, Nominal), national security (Saronic, Hadrian), and AI (Exa, Granola, Suno).

The current AI moment has raised the bar for startups across the board – revenues are exploding, there is a race to capital scale, some markets feel unbounded in size. Many of my priors or frameworks on company building feel the most subject to change that they’ve been in my career, but I’m more energized to learn from entrepreneurs as they navigate this new world and to be a meaningful investment partner as their businesses flourish.

Our team has also reflected that it is a time to lean on the fundamentals of our business. We believe Haystack’s historical orientation and focus on founder selection and partnership above all else is evergreen. These funds will enable us to form new relationships with entrepreneurs, and we’re excited to earn our way into their rounds and work for them as they explore new frontiers.

Personally, it’s fun to be part of a core team that’s worked together for a long time. This feels increasingly rare in the venture industry. Given our runtime together, my colleagues Semil, Divya, and I all have a high degree of internal trust and interoperate well. It’s a joy to work this way, and we also think it makes for a better founder experience.

Thank you to all the parties that make Haystack possible. It is a pleasure to serve the founders we do, and we approach that responsibility with care, humility, and conviction. We are grateful to our Limited Partners, who have placed their trust and faith in us over multiple fund cycles. And Haystack benefits from being an ecosystem participant, where we can collaborate with and learn so much from other co-investors and friends.

We couldn’t be more excited about what the future holds. If you are ideating or building at the earliest stages, please reach out.

- Team Haystack

Today, the team at Blockit launches publicly and announces their $5M seed financing, led by Pat Grady at Sequoia. They are building the world’s first calendar network – an always on, AI time assistant that actually works. Try it for yourself here, it’s easy to get started.

Haystack has been a proud investor in the company since inception. In some ways, this is a business story; but in many ways, it’s a more personal one for myself and Haystack. I first met the co-founder & CEO of Blockit, Kais Khimji, over a decade ago as a freshman in college. From the beginning, I always admired his doggedness, independent conviction in his own beliefs, and unique ability to bring people together.

Our paths intersected again in 2019 when he moved out to the Bay to join Sequoia as an investor, and I was starting at Haystack. We were at a similar place in our venture careers and acted as thought partners across our respective firms. I continued to learn from him – he was always in front of the most interesting growth companies. One could always expect a clever take or market framework. During his time at Sequoia, I had a feeling he would eventually want to do something of his own. He even forced me to schedule with an original Blockit prototype in 2020, which I had *lots* of feedback on. Kais always pushed back in a way that I appreciated. Persistent, not stubborn.

A little while back, I received a call from him. “I’m getting engaged, I gave in my notice at Sequoia, and I’m starting a company.” I committed to invest on the spot. The early stage venture job works best when you get to follow your nose on the most talented people, and those people, the entrepreneurs, create the opportunities for you as the investor. Kais created the opportunity for Haystack to invest, and we thank him for it.

Fast forward to early 2026, and Blockit is a thriving, fast growing company. Kais teamed up with his co-founder John Han, built a team from backgrounds at Retool, Waymo, and Notion; and Blockit now serves hundreds of customers from companies like Together.ai, Rogo, and Brex. Their end-to-end agent product *actually* works without human intervention. It might sound straightforward at first blush, but smoothing out all the data and UX papercuts for an intelligent scheduling assistant is no joke. As a small aside, Kais and the Blockit team have provided an excellent vantage point into the world of building useful agents. The frameworks from the team are bountiful and rich – everything from “come for the agent, stay for the network” to AI’s impact on product ceilings and floors.

Blockit has already scheduled hundreds of thousands of meetings, and there are millions more coming. Haystack is proud to support Kais and the Blockit team as they enter the next chapter of scaling. This story has been a long time in the making.

Maybe it’s a little early for 2026 predictions and maybe these scream ‘perma-bull’ but I wanted to have some fun with tech and macro predictions for the coming year. These cover themes I’m particularly interested in, and the practice of making (and trying to quantify) somewhat loose predictions sharpens focus. There are plenty of bad tail risk things that could happen - Taiwan escalation, quantum cryptographic heist, bioterrorism - but I’ll shy away from that here :)

1/ The LLM ads business turns on in a meaningful way. OpenAI surges past $1B in ads revenue within 6 months. The total market could be over $5B in year one.

2/ METR task length eval trendline holds. Frontier models reliably complete a workday (~8 hours) of coding tasks 50% of the time.

3/ AI coding market continues to explode. Cursor hits $5B revenue run rate, Claude Code hits $15B revenue run rate.

4/ Perp volumes cross $10T one month. Drivers include more liquidity, RWA, clients / front doors, and potentially even new exchanges / trading platforms. Prediction market volumes (primarily Kalshi and Polymarket) exceed $30B in one month with more institutional flows and enterprise participation.

5/ Waymo crosses 1B rider-only miles. They continue their steady rollout across the United States and likely hit every “NFL city” by the end of 2027.

6/ OpenAI and Anduril go public. Both have to rationalize their expenses to some public shareholders, but I have little doubt there will be plenty of demand for the shares. I don’t think Stripe will go public.

7/ Microsoft buys Glean and Cognition. Satya is hungry for top flight product and engineering talent. Microsoft has existing product surface here, but could use upgrades.

8/ 5K home robots (with a predominantly U.S. supply chain) ship to consumers in H2. The battle to become “Apple of humanoids” kicks into full gear. The robotics supply chain (motors, actuators, sensors) becomes the equivalent of the AI capex trade (power, memory, cooling, optics) in the public markets.

9/ Zero shot antibody design means binder cost asymptotes to ~0. The universe of potential target proteins radically increases and more models shift to incorporate developability attributes.

10/ GLP-1 revenues cross $75B by end of year, showing plateauing growth and pricing pressure. Delivery modalities diffuse and insurers continue to process how to cover them. They still mark one of the biggest drivers of change to American consumer spending habits since the advent of the automobile, consumer packaged goods, and big box retail chains.

11/ Unemployment rate goes over 5%. AI effects start to kick in.

12/ Trump unveils an “Operation Warp Speed” effort (federal subsidies, deregulation, public-private partnership) for housing ahead of midterms. His actions will be seen as extreme and overreach, but the crux of the issue is bipartisan in nature.

In the late fall of 2024, our friend Kevin Mahaffey sent us some background information on a team he had backed – founders working on what was described as an “operating system for home building.” The company was Type Five. Even as a seed stage company, they had already built several customized, backyard ADUs (accessory dwelling units) and homes in the East Bay in Northern California.

I’ll admit that my partner Semil and I were initially skeptical. We remembered the wave of companies from years back working on modular construction tech or helping consumers build ADUs. Most never lived up to their promise – they were often too capital intensive, couldn’t make the unit economics work, and thus were never able to achieve meaningful venture scale.

Yet, we noticed how thoughtful their pitch materials were, and as we looked further, saw that the Type Five team had already accomplished so much, even with a limited amount of capital. They’d cultivated a great brand and reputation with the homes they had built for families across the Bay Area, with many more on the way. We decided to dig in. We spent time getting to know the founders, Tim and Aleksis, through a series of Zooms and a long, rainy afternoon in Berkeley.

We came away very impressed. The pair had spent a lot of time meticulously mapping and studying the construction tech market. How could you build the next Lennar? What would enable it to scale in a capital efficient way? What were the common patterns of companies that didn’t work? Tim and Aleksis were well ahead of any of our objections. They complemented each other very well, striking the right balance of wildly optimistic and intentionally pragmatic. Lastly, it was clear that much of their shared purpose for Type Five stemmed from their deep ties to the Bay Area and a passion for building the next starter home for millions of young Americans that can’t afford a home where they live and work. Tim and Aleksis originally met as undergrads at Cal years ago, and are proud to have started their company in the East Bay, serving their communities first.

So what makes Type Five exciting—and why do we believe they have a real shot at becoming America’s leading tech-enabled homebuilder?

1. Each home or structure is unique, but is composed from the same set of building blocks. Type Five avoids the capital costs of centralized production and manufacturing that the last generation of ADU builders faced – they instead provide local contractors with a consistent and predictable system to stand up homes. Over time, any contractor across the US should be able to stand up a Type Five build cost effectively.

2. Their internal parametric design software Formwork generates permit-ready plans for a range of structures. Rather than selling Formwork as a tool to developers or contractors, Type Five integrates it into a full-stack product—capturing more value and streamlining the build process from design to completion.

Type Five has already proven to be multiples faster, cheaper, and less labor intensive than traditional construction. For contractors, they also provide higher revenue per project and increased availability of jobs. In a country facing a deep and chronic housing shortage, Type Five has the potential to materially improve the cost of living.

Today, Type Five announces their seed round, and Haystack is delighted to lead alongside Village Global and SNR. They are expanding rapidly, but if you find yourself in Berkeley or Oakland, I’d highly recommend stopping by one of the builds.

About a decade ago, Chris Dixon and Balaji Srinivasan popularized the idea of “full stack startups.” The premise was that as software moved from an independent sector to natively integrated in the entire economy, the best opportunities were to build end-to-end experiences and bypass incumbents. Don’t just sell in, but compete head on.

Coming out of that era, there were wild successes like Tesla, Bitcoin, Uber, and Airbnb. But there was also a whole host of companies and ideas attempted that didn’t pan out. Some of those cases were pure mismanagement. Some failed to escape the base rates of the sector when it came to growth or valuation expectations. Competitive advantage in sectors like insurance or logistics often stems from traditional economies of scale, rather than software or technology leverage. The venture capital blitzscaling model was often a square peg meeting a round hole. I understand why investors and founders have skirted away from some of these opportunities in recent years.

But, maybe we were still just too early. I loved the sentiment behind this recent tweet from Immad Akhund, founder of Mercury. In 2024, we funded several ambitious projects at Haystack – founders re-thinking industries like biomanufacturing to funeral homes to residential housing from the ground up and from first principles.

What continues to change? What does the ingredient set look like today for founders interested in going full stack? What quivers in their bow do founders have today they didn’t have 10 years ago?

• AI: There is incredible interest in how AI will transform the product experience for the end user, but I’m intrigued by how it changes the operating structure of large organizations, acting “under the hood.” Whether it’s using LLMs to generate internal documentation to audio assistants helping with customer support to multi-agent prompting acting as a substitute for market research, there is a lot of room for experimentation. We already have some consumer services businesses in our portfolio experimenting with LLM-based workflows behind the scenes.

• Robots: We’re further away from widespread robotics adoption, but the encompassing advancements in LLMs acting as “robot brains,” world understanding models, and work from companies like Physical Intelligence and Skild wildly surpass any state of the art of a decade ago. Robots truly help us tackle the physical world, and I’m most interested in areas where they act as a substitute for dangerous and dirty work.

• Regulatory muscle: Silicon Valley is *significantly* more politically engaged in DC and elsewhere than it was a decade ago. Much of this was in recent years, but the growing engagement with regulatory and political bodies mirrors the development of any American industry. See automakers, banks, airlines. SpaceX and Anduril’s success partially stems from their in-house human capital that understands how to work with and navigate government agencies and regulatory bodies. The knowledge base is building up in the ecosystem to then disseminate to the next generation of full stack companies.

• Capital: There was bubble talk 10 years ago. Sam Altman famously made a bet that there wasn’t. And ironically, the size and scope of the venture capital industry back then pales in comparison to today’s landscape. There are large (large!) venture capital firms with deep pockets continuing to put billions of dollars to work every year. Not just equity either. This could be semantics, but many of these traditional venture capital firms are turning into “technology and innovation companies” with a host of financial products like debt, buyouts, revenue-based financing, etc. They are eager to fund capital-consumptive opportunities with innovation at the core. Much of their newfound business model depends on it.

The right combination of these factors give founders increasing opportunity to find leverage in their business models, build product and distribute in formerly-permissioned environments, and accumulate market share economically for their teams and investors.

Why am I personally interested in all this? Why do I want more full stack startups to exist? The cost of software development continues to come down (thanks Chris!), and the odds a YC team pivots into one’s space and competes over the weekend increase. The minimum marketable product in financial services, energy, agriculture, space, etc. simply cannot be built over a weekend. I like businesses that avoid competition, and the full stack approach also self selects for founders with a certain level of authenticity, insight, and aspiration.

Tomorrow’s technology companies have the opportunity to contribute to growth. Not growth in terms of MoM, YoY, ARR, etc., but in terms of real GDP growth. True economic growth. And that will only come from attempts to reshape large parts of the economy.

If you are dissatisfied with the status quo in some way or want to revisit a full stack startup idea, I would love to speak with you.