Musical accompaniment for this week’s newsletter. Is AI displacing enterprise software inevitable? When scanning the headlines, it sure seems like the relentless drumbeat of progress toward the AI future is building toward a crescendo.
Once Wall Street darlings, software stocks have been sliding lately as investors increasingly worry the sector could be upended by AI. AI companies certainly offer plenty to swoon over. OpenAI and ServiceNow have struck a deal to embed the former’s AI models and agents in the latter’s software, the latest instance of agentic AI being integrated into corporate software. Claude is taking the AI world by storm, and even non-nerds are taking notice. Even the founder of SaaStr says he’s done hiring humans in sales and is choosing AI agents instead. Et tu, Jason?
But is AI’s inevitability a lock? There’s enough signal out there to give pause to even the most enthusiastic. Business leaders’ faith in AI's productivity-boosting powers is getting a reality check from their own workforces. Then there’s new benchmark research from Mercor that raises fresh doubts about AI agents. According to Mercor CEO Brendan Foody, who worked on the paper, the models’ biggest stumbling block was tracking down information across multiple domains — something that’s integral to most of the knowledge work.
This dovetails with many conversations I’m having with people who know a lot more about what goes on under the hood of enterprise software. AI’s limitations certainly came up in my recent conversation with Jerome Gouvernel , CEO and co-founder of datascalehr. “Enterprise requires auditability of decisions,” he says. GenAI is “never quite sure about anything, so that's a problem.” That’s putting it mildly if you are doing compliance-heavy work like global payroll.
That’s just one use case, but you don’t need to stretch too hard come up with others that AI isn’t even close to delivering on. Can AI get there? Probably. But what’s the time horizon? I’d bet it is longer than many investors think.
What else is going on this week?
Great, Another Unemployed Gen Zer on LinkedIn
Will someone please give this man a job?
This just in: Fernando Mendoza might just save LinkedIn. I mean, the guy is a miracle worker, but isn't that asking a lot?
Eightfold AI Gets Sued Over Ratings System
Getting a lawsuit dropped on your company is never fun. Seeing headlines trumpeted about it in The New York Times? That’s a big oowie. The lawsuit claims the ratings assigned by A.I. screening software are similar to those of a credit agency and should be subject to the same laws. The inimitable Heather Bussing explains why the lawsuit matters — and doesn't.
This Week on the Work Tech Weekly Podcast
As I mentioned in the lead item, we had a great convo on the podcast that’s totally worth a listen. Thanks, Jerome!
Shameless Plug: Chatting with Joel Stupka on HR Snacks
It’s always fun catching up with my former wingman, and I’m proud to say that he has become quite the Work Tech expert. Check it out here.
Funding, Acquisitions, and IPOs
- Docebo acquires 365Talents. This move basically turns Docebo’s LMS into a living skills engine that weaves real-time workforce intelligence into learning so companies can spot gaps and trigger the right development or mobility action. It’s a good hedge. Read Michael Rochelle’s take from Brandon Hall Group. (Press Release)
- Fintech Payoneer acquires Dublin startup Boundless. This is the “fintech eats HR compliance” move we’ve been waiting for, because global hiring isn’t hard until the law shows up, and that’s where the real margin lives. It’s also a quiet shot across Deel/Remote’s bow because payments + EOR + compliance in one pipe = sticky as hell, and Payoneer already owns the money rail. (Silicon Republic)
- Remote acquires Atlas global expense management platform. Yeah, Remote’s not stilling still either. It just turned its global employment OS into a more complete workforce finance machine — folding in Atlas’s cards, spend controls, perks, and benefits to nuke one of the last pain points for distributed teams. (HR Tech Cube)
- Benepass raises $40 million Series B. The NYC startup is winning as employee benefits are quietly becoming the new fintech battleground. Employers are desperate for anything that makes rising healthcare costs feel less like a hostage situation. The real game isn’t shiny perks, it’s benefits infrastructure and smarter spend controls wrapped in a UX that employees will actually use. (FinSMEs)
- Vensure Employer Solutions acquires AI recruiting platform Distro. This move isn’t just about slapping “AI” on the menu — it accelerates hiring velocity and candidate quality across its 161,000-client base, plugging a major gap in the people ops lifecycle with intelligent automation. (Press Release)
- One to One Health raises $12 million. High-touch primary care isn’t just a defensible wedge in the increasingly tech-driven healthcare market. It’s an employee benefits solution when it’s tied to employers, health plans, and AI-enabled clinical tooling. (FinSMEs)
- Agileday raises €6.4 million Series A. This Finnish startup is a bet on AI-powered professional services automation that unifies sales, staffing, delivery, and finance into a single operating system, slicing through the chaos of fragmented tools. (FinSMEs)
- The IPO window won’t stay open on its own. The IPO window for 2026 is real but fragile — it’s being propped open by a handful of generational names like OpenAI and SpaceX that can still generate serious investor FOMO, not by the usual crop of enterprise SaaS or mid-tier unicorns. Ordinary IPO candidates without breakout narratives or category dominance won’t be enough to keep the market’s doors ajar if sentiment cools, meaning timing and standout growth stories matter more than ever. (Crunchbase)
- Employers.io acquires Job-Applications.com. This is a smart move that essentially turns a sourcing-adjacent board into a proprietary pipeline plug-in for its employer product suite. (Press Release)
Industry Notes
- Workday co-founder Dave Duffield gives $371.5 million gift to Cornell. The Ivy League university will name its engineering school after him. (Wall Street Journal)
- Europe prepares for nightmare scenario: The U.S. blocking access to tech. (Wall Street Journal)
- JESS VON BANK will be the Main Stage Emcee for UNLEASH America. (LinkedIn)
- Businessolver advances AI benefits support and HR analytics in 2025, reporting 83 client NPS. (Press Release)
- Workday to invest CAD $1 billion in Canada over five years. (Press Release)
- Centrical launches AI role-play simulations and coaching to close the frontline readiness gap. (Press Release)
- Hirevue joins Workday AI Agent Partner Network, accelerating the shift to skills-based hiring. (Press Release)
Worth Reading
- Humans& wants to empower workers, not replace them. It’s an AI narrative that has some legs. (The New York Times)
- Cory Doctrow: AI companies will fail. We can salvage something from the wreckage. (The Guardian)
- What did you do with your weekend? This dude climbed one of the world’s tallest skyscrapers without a rope. Or an elevator for that matter. (NBC News)
- So, you want to build an ice rink in your backyard? This Brooklyn woman actually did it. (Curbed)