AI-Driven 'Vibe Coding' Reshapes Software Development and Startups

The AI-powered programming approach enables rapid growth for startups but raises concerns over debugging and technical expertise.

Vibe coding, coined by Andrej Karpathy, relies on AI tools like Cursor AI to generate most of the code, reducing manual effort by developers.
Approximately 25% of Y Combinator's Winter 2025 startups used 95% AI-generated code, highlighting the method's growing adoption.
Startups leveraging vibe coding have achieved unprecedented revenue milestones, with some earning $1–10 million annually with fewer than 10 employees.
Challenges persist as developers struggle with debugging and risk losing deep technical understanding due to heavy reliance on AI.
The trend offers opportunities for young engineers to create standalone businesses in a competitive job market, while cultural reactions, including memes, reflect both enthusiasm and skepticism.