Insurance companies will face 'massive disruption' from AI adoption, says Bessemer's Byron Deeter

Watch on YouTube ↗  |  January 23, 2026 at 16:25  |  2:37  |  CNBC
Speakers
Byron Deeter — Partner, Bessemer Venture Partners

Summary

Byron Deeter, partner at Bessemer Venture Partners, discusses how AI is set to disrupt legacy industries, especially insurance, healthcare, accounting, and legal. He argues that incumbents failing to adopt AI will face massive disruption and a reallocation of economic rent. He also expects a powerful M&A undercurrent in software this year as legacy vendors buy innovation to survive the AI transition.

  • Byron Deeter of Bessemer sees AI as a perfect fit for data-intensive service markets.
  • Insurance is highlighted as a legacy industry facing massive AI-driven disruption.
  • Incumbents that don't adopt AI in underwriting and data outreach risk being disrupted.
  • Healthcare, accounting, and legal are also named as markets about to be 'blown up.'
  • Legacy software vendors may need M&A to innovate and restore valuations.
  • M&A is expected to be a powerful undercurrent and second leg of the stool this year.
  • Companies that fail to respond to the AI transition risk being left behind.
Ideas
Byron Deeter Partner, Bessemer Venture Partners 0:45
AI will disrupt healthcare, accounting, legal.
Byron says Bessemer loves large, data-intensive service markets such as healthcare, accounting, and legal, similar to insurance. He believes these legacy industries are about to be 'blown up' by AI because AI is a perfect fit for data-intensive decisions, leading to massive disruption and a reallocation of economic rent away from incumbents.
XLV Accounting LEGALTECH MED
Byron Deeter Partner, Bessemer Venture Partners 0:45
AI will disrupt legacy insurance incumbents.
Byron says insurance is a legacy business and an ideal AI use case because underwriting, data outreach, and provisioning are incredibly data-intensive. Incumbents that fail to adopt AI in underwriting and business building will face massive disruption, and there will be a huge reallocation of economic rent as many incumbents are completely disrupted by new challengers.
KIE HIGH
Byron Deeter Partner, Bessemer Venture Partners 1:48
Legacy software vendors need M&A to survive.
Byron says legacy software vendors cannot innovate fast enough internally, are sitting on big cash piles, and need to buy because build and partner are insufficient. He thinks M&A will be a powerful undercurrent this year and the second leg of the stool to restore valuations; those who don't innovate or acquire will be lapped and die in this generational AI transition.
Legacy software vendors HIGH
Up Next
2:43
Natural gas surges ahead of winter storm: Here's what you need to know
CNBC · Jan 23
4:58
We have ‘two more rate cuts coming,’ says Wharton’s Jeremy Siegel
CNBC · Jan 23
3:35
TikTok seals U.S. joint venture: Here's what you need to know
CNBC · Jan 23
4:00
Intel plummets on earnings
CNBC · Jan 23
1:30
Consumer sentiment rises in January
CNBC · Jan 23

This CNBC video, published January 23, 2026, features Byron Deeter discussing XLV, Accounting, LEGALTECH, KIE, Legacy software vendors. 3 trade ideas extracted by AI with direction and confidence scoring.

Speakers: Byron Deeter  · Tickers: XLV, Accounting, LEGALTECH, KIE, Legacy software vendors