Y Combinator Is Investing in AI-Native Agencies-What This Means for the Future of Marketing Services

Welcome to How to Build an Eight Figure ABC. My name is Jordan Ross and I'm your host. And over the course of this journey, we're going to be interviewing eight figure agency owners and going through the systems that I've seen work and we've been implemented into our clients' businesses that have helped our clients add a half a billion dollars in annual recurring revenue over the last handful of years. I myself have already hit the eight figures in annual recurring revenue and when I got there, I wasn't happy. I was stressed. I was disassified and I didn't like the people I was working with. So I clicked the restart button and went from 12 million in annual portfolio revenue back down to the mid-sem figure level to a climb back again. And on this journey, I'm going to be documenting my process on how I'm getting back to the figures and bringing you expert industry leaders who will tell you everything they did to get there as well. Thanks for tuning in and enjoy the episode. Why Commonere, the world's most elite startup accelerator, is now investing in marketing agencies right now. And if you want to build a business that is actually relevant and has significant size in five to 10 years from now, this might be the most important update or story of all of 2026. And what's really important, this signals something so much bigger on a macro trend for marketing agencies that this will completely change the future of our industry. And in this breakdown, I'm going to be walking through exactly who Y Commoner is and why this is relevant for you. So first and foremost, if you don't know who Y Commoner is, oh my goodness, you were living under a rock or you're really just embedded in the marketing agency space because Y Commoner is arguably the best startup incubator in the world. It's probably the best start and incubator in the world. And I'm just going to list off some of their top like 10 or 20 businesses that they have funded that you definitely know Airbnb Dropbox, Stripe, Reddit, DoorDash, Instacart, Coinbase, Twitch, GitLab. We use that. Zapier, Brex, Notion. Guys, I can keep going. But so many of every single person in the world that is in a first world country is using a Y Commoner company in some capacity. And this is so important because I did not think this would happen in 2026, but they are investing in marketing agencies, which is freaking crazy because I've been saying this is going to happen, but it's actually here. So they released a deck and they do this every year. That basically says here are the types of companies we will invest in. And on their YC request for Serbs 2026, their number 3 one was AI Native agencies. So here's exactly what they said. I'm going to read this. Agencies have always been crazy hard to scale. Now instead of selling software to customers to help them work, you can use that software. You can charge way more by selling them this finished product at a 100X the price. Agencies of the future will look like software companies with margin and scale. And these guys know it because these guys know of in Silicon Valley. If you're using HubSpot like HubSpot knows they have HubSpot agencies that are selling that. You have all these software tools and products that like agencies use these products to help companies. They know this and they are seeing the ability. They know something that we don't. And what they're going to do is they're going to get thousands and thousands of applicants of really tangible or technical engineers like the world's best most talented engineers. And they are going to plow tens of millions, if not over a hundred millions, a dollars of investment into attempting to build AI native marketing agencies. And just to distinguish the difference, if you are using AI tools publicly, you are not even an AI-nabled company like you're barely using AI. If you're building custom AI, so if you're using NADN and GitHub and Cloud Code and building internal products to the point where you're now like really increasing your efficiency, you're an AI-enabled agency. But what they're talking about in AI native agency is a completely different story. And this is who you're going to be competing against in the next two to three years. It's going to happen quick. These guys are going to hit the ground running. They're going to have the best advisors in the world and they're going to have a network of insanely technical founders around them to make sure that they can destroy you because they have literally millions of dollars of investment to build these companies when you might have 5K a month or less or 10 or 20K a month to build your tech stack. So the window is closing and the trend that this is going to change the marketing agency. So this is like the biggest thing. Jet Bezos didn't build Amazon by being the smartest guy in the room. He built it by building systems. In his own words, good intentions don't work. Mechanisms do. And that's the whole game. Most ancient humans are stuck at some figures because they're running their business on poor and effective or non-existent systems. There's no repeatable way to analyze data, to root cause constraints, to build the correct strategic plans, to source higher onboard train, retain, develop, manage talent and clients. Everything is dependent on the founders showing up every single day and willing their business to success. If you want to hit 8 figures in annual revenue, you need my 13 systems. Not 12, not a couple of processes, but all 13. When you plug all of these into your business, when you identify what you don't currently have and build all 13 of these systems so you can truly scale, you will stop firefighting and start compounding. That's the difference between running an agency job and running an agency machine. If you want to learn all about these 13 systems to get your business to the next level, go to the link below and get my ebook on the 13 systems so you could finally build a business that works without you and hit 8 figures. In 2024, I found out that I had 4 years of tax returns filed wrong because my IRS CPA didn't bother to make sure my taxes were correct. The guy that I thought I was safe with, the guy that used to work for the IRS, screwed me. Because I assumed he was actually making sure that the taxes he was filing were accurate. And to my surprise and my detriment, he didn't care to look. Because he's incompetent, because he was too busy, he was booked with clients out the wadzu, and he's not an operator. He did not know how to actually scale a practice. And this is the issue with the financial services and accounting industry. And this is exactly why I started 8 figure finance. Led by an amazing forensic account in CPA Ben Sternberg, we have been delivering exceptional service and finances in books and taxes that you can trust with your agency. Not only your agency, your life. If you're unhappy with your accountant, CPA, or bookkeeper, or if you want an extra party to validate and make sure your finances and books are actually correct, put 8 figure finance.com where we will review your finances, P&L, and books complimentary to ensure you're not getting screwed. This completely changes the signal to investors. Now when why Commoner makes a move, others follow. They are the whale and the ecosystem, and they have a lot of smaller fish and a lot big fish that are going to look at this and they're going to say, oh, if they're doing AI and AI and marketing issues, we probably should too. So other investors are going to follow. There's going to be a lot more money beyond what they're investing. And all of these companies that are going to launch as a result are going to be your competitors. And here's the crazy thing. I don't think the price points are going to change. I don't think that's the objective. I think it's just the objective is to have a crazy margin, especially. So they might go in, in either the AI native with the same margin and use that margin to devel better tech or they might go in and just undercut you from day one. What this means for you, if you actually care about staying in business, if you truly are very sincere and you say, I want to have more than just a local shop of a couple people using AI tools. You need to really consider like this will completely change the dynamic of the space because the best players in the space, the ones that do eight and nine figures, they are all going to have in house IP. And this is the biggest signal. AI native means people go to these companies because they have the best technology to make their customer succeed. And they're going to have way better speed, way better quality, way better gains, way better, everything. They are going to define like what the space will look like. Their best two agencies will completely define it and then that will trickle down to the industry. So these companies will have AI native and IP, meaning that like they're not selling tool on how you could build better creative strategy or a tool and how you can run better ads or a tool on how to do something. They own the tool. And instead of selling it as a SaaS, they sell it as a service. And that's going to be crazy because they're going to have crazy margin. So they're going to probably plow way more dollars into marketing as a result. They're going to be able to spend more to acquire customers than you could afford to spend because their margins are going to be just disproportionately bigger than you. This is the biggest signal that the industry is changing. And what this means for you in your business, if you have any of hope of building an eight figure business. And if you're already at eight figures of sustaining that level, if you do not have an IPM, and like I said, this is not using chat BT. This is not using a public tool. This is building some form of capabilities for efficiency and then also modes. Also your own internal products that just makes your service better. If you don't have that, eventually, it might not happen in 2026. It won't happen in 2026. It might not happen in 2027. Like this will start to hit every sector. This will hit the every major marketing sector, the law firm space, the legal space, the D to C space, servicing SaaS space, like the Hawk medias of the world are going to be seeing this and like they're going to be gobbling up like the herringones of the world. They're going to be seeing this and that like I spoke to herringone today, like they are actively pursuing things like this. I really biggest encouragement is to like reflect on like, what are you willing and able to do to start to compete if you don't have custom stacks. I'll tell you from our experience right, there's just a massive learning curve. You could use cloud code, could do this stuff and I actually met a founder, she's profing over a million dollars a year and the founders coding, I'm like, dude, what are you actually doing that you think you as a founder coding is just a good idea when you already have a million dollars a profit? So this is something you should really consider on how you want to change your trajectory, how you want to hedge your bet because this is a hedge, you need to hedge by not doing something you're at risk by investing at a bare minimum, it's a hedge and on the upside, like what we see is the efficiencies go up, profits go up, results go up, LTVs go up. This is not a scary update, this is just reality that we're now. It's no longer hype like the best venture capital business in the world is seeing that this trend is the place to be right now and they are going to change the industry all around us. Just like how Airbnb has changed that the way we travel, just like how strength has changed the way we do process payments, just like how DoorDash has processed an Instagram, have processed the way we eat food and get food, just like how Zapier originally changed the way that we build automations, just like how, God, guys, there's so many example Coinbase changed the way that we leverage and buy and sell and hold crypto, like there's so many crazy examples from YC on how things have been changed and there will be not one company, but there will be many companies that they could service not 100, not 200, they could service thousands of customers with very good results. And I think it's going to be very hard to compete in the future. And if you are not thinking about this or if you're not hedging for this, I don't know if it's a death wish, but I think you're flirting with it. So consider yourself warrant. Good luck. Stay tuned. Thank you for listening to this episode of How to Scale an Agency. It would mean the world if you could like, subscribe and comment on this podcast. So more people can find it organically or share it with a friend. If you're looking to scale your agency and you need help, you're looking for a true partner. Go to 8figureadency.co/call. My business has been built on becoming fiduciaries for other companies. We are going to be your partner where I will bring in my 8 figure talent to help you grow, working side by side. If you need help with that, go to 8figureadency.co/call or like, share, subscribe to the pod. Thank you so much. I'll catch you in the next episode.