The first wave of defaults due to AI disruption in mid-2027 challenged the assumption that ARR would remain recurring, and by end of 2027 threatened every business model predicated on intermediation.
Pessimistic
Source
THE 2028 GLOBAL INTELLIGENCE CRISISJames van Geelencitriniresearch.com
View all claims from this article Original Quote
Seventeen years without a real default cycle had left privates bloated with PE-backed software deals that assumed ARR would remain recurring. The first wave of defaults due to AI disruption in mid-2027 challenged that assumption. This would have been manageable if the disruption remained contained to software, but it didn't. By the end of 2027, it threatened every business model predicated on intermediation.
Outlook
PessimisticMass defaults across PE-backed software and intermediation businesses would cause significant financial system stress and capital losses.
Timeframe
2027Explicit
Confidence
speculative scenario
Explicitly labeled a scenario, implying speculative confidence.
Potential Data Sources for Validation
Private credit default rates tracked by Moody's, S&P, and Bloomberg; PE portfolio company restructuring announcements; leveraged loan default indices.
About the Author
James van Geelen
Citrini is the pseudonymous founder of Citrinitas Capital Management Inc. and the author of Citrini Research, a top finance Substack specializing in thematic equity investing and global macro trading, known for early calls on AI and GLP-1 investments.
Author Perspective
Across 17 tracked claims, James van Geelen skews pessimistic.
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