AI Dominates Venture Capital Landscape in 2025, Driving Record Investments and Reshaping Startup Ecosystem

If you're not an AI startup, good luck raising money from VCs | TechCrunch

New PitchBook data illustrates how dramatically AI is dominating startup investment, with 2025 on-track to become the first year when AI accounts for more than half of all VC money invested. PitchBook reports that VCs have poured $192.7 billion into the industry so far this year, out of a total $366.8 billion, according to Bloomberg. In the most recent quarter, AI accounted for 62.7% of the money invested by U.S. VCs, and for 53.2% of money invested by global firms. Most of that money is going to marquee names like Anthropic, which announced a $13 billion Series F in September. Meanwhile, the number of startups and venture funds successfully raising money are at their lowest levels in years -- PitchBook says that 823 funds have been raised globally so far in 2025, compared to 4,430 in 2022. PitchBook's director of research Kyle Sanford told Bloomberg that the market is becoming "bifurcated," where "you're in AI, or you're not" and "you're a big firm, or you're not."

AI Is Dominating 2025 VC Investing, Pulling in $192.7 Billion

Venture capitalists poured $192.7 billion into AI startups so far this year -- setting new global records and putting 2025 on track to be the first year where more than half of total VC dollars went into the industry, according to data provider PitchBook. Most of the capital went to established startups - Anthropic and xAI both raised billions in funding this quarter -- while some other lesser-known upstarts struggled, especially companies that are not focused on AI. The hangover of a tight environment for public listings and acquisitions has also left some venture investors unwilling to make new bets on unproven companies, PitchBook found.

Q3 Venture Funding Jumps 38% As More Massive Rounds Go To AI Giants And Exits Gain Steam

Global venture funding gained significantly in Q3 2025, closing up 38% year over year, Crunchbase data shows, as massive funding deals, particularly for giants in the AI sector, continued to lead. All told, Q3 venture investment reached $97 billion, up from $70 billion in Q3 2024, per Crunchbase data. Quarter-over-quarter, funding was up slightly from $92 billion in Q2. In each of the last four quarters, global startup funding has been above $90 billion -- quarterly amounts not seen since Q3 2022 -- Crunchbase data shows. Startup investment has also now posted a year-over-year increase for the past four quarters, driven by megarounds of $500 million or more, largely to AI-related companies. Table of Contents Capital concentration As funding has increased this year, so has capital concentration. Over the last four quarters, venture investment has concentrated into rounds of $500 million or more, an analysis of Crunchbase data shows, with more than 30% of funding each quarter going toward such megarounds. The three largest venture rounds in Q3 2025 were raised by foundation model companies Anthropic ($13 billion), xAI ($5.3 billion) and Mistral AI ($2 billion). Billion-dollar-plus funding deals also went to Princeton Digital Group, Nscale, Cerebras Systems, Figure, Databricks and PsiQuantum. All in all, a third of all venture investment in Q3 went to just 18 companies that raised funding rounds of $500 million or more each. That is well above historical proportions before Q4 2024. Megaround funding also gained steam as the quarter progressed, with 11 of the 18 companies raising funding in September. AI leads In another blockbuster quarter for AI funding, $45 billion -- or around 46% of global venture funding -- went to the sector, with 29% invested in a single company, Anthropic. Hardware was the second-largest sector, with large rounds raised by robotic, semiconductor, quantum and data infrastructure companies in the third quarter totaling $16.2 billion, per Crunchbase data. The healthcare and biotech sector raised $15.8 billion in venture funding in Q3, making it the third-largest sector for the quarter. Financial services, the fourth-largest sector, raised $12 billion in total. Along with a greater concentration of capital in larger companies, the U.S. predominated, with $60 billion -- or just under two-thirds of global venture capital -- going to U.S.-based companies in Q3. Late stage funding up YoY Most of the third quarter's year over year gains were in late-stage funding. Late-stage investment in Q3 totaled $58 billion, up more than 66% year over year, and slightly higher quarter over quarter, Crunchbase data shows. (The peak quarter for late-stage funding in 2025 was Q1, with the $40 billion round for OpenAI significantly boosting the numbers). Early stage slightly up Early-stage funding totaled nearly $30 billion for more than 1,700 companies in Q3, Crunchbase data shows. That's up just over 10% quarter over quarter and year over year. Larger Series A and B rounds were raised by companies working on AI data workloads, energy, quantum, robotics, biotech and AI applications. Seed increases Seed funding reached $9 billion in Q3 across more than 3,500 companies. Seed funding was up slightly from $8.5 billion invested a year ago. (Seed funding totals also typically increase over time, as many seed rounds are added to the Crunchbase dataset after the close of a quarter.) Strong exit activity in Q3 2025 For the second quarter in a row, IPO activity increased year over year. The largest venture-backed IPOs in Q3 by value were Chery Automobile, Figma, Klarna and Netskope. On a global basis, 16 venture-backed companies went public above $1 billion in Q3, collectively valued north of $90 billion at their IPO prices. That compares to 18 companies in Q2 with a collective $60 billion in value. Both quarters were up significantly from 2024. In Q3 2025, M&A dollar volume reached $27.5 billion in reported exit value for venture-backed companies, Crunchbase data shows. That's down from $43.6 billion in Q2. Nine companies were acquired for more than $1 billion each in Q3, Crunchbase data shows. Four of the companies were in healthcare and biotech. The remainder were in sectors including cybersecurity, AI, financial services, product development and sports betting. Notable among these was OpenAI's acquisition of Statsig and Workday's acquisition of Sana. Methodology The data contained in this report comes directly from Crunchbase, and is based on reported data. Data is as of Oct. 2, 2025. Note that data lags are most pronounced at the earliest stages of venture activity, with seed funding amounts increasing significantly after the end of a quarter/year. Please note that all funding values are given in U.S. dollars unless otherwise noted. Crunchbase converts foreign currencies to U.S. dollars at the prevailing spot rate from the date funding rounds, acquisitions, IPOs and other financial events are reported. Even if those events were added to Crunchbase long after the event was announced, foreign currency transactions are converted at the historic spot price. Glossary of funding terms Seed and angel consists of seed, pre-seed and angel rounds. Crunchbase also includes venture rounds of unknown series, equity crowdfunding and convertible notes at $3 million (USD or as-converted USD equivalent) or less. Early-stage consists of Series A and Series B rounds, as well as other round types. Crunchbase includes venture rounds of unknown series, corporate venture and other rounds above $3 million, and those less than or equal to $15 million. Late-stage consists of Series C, Series D, Series E and later-lettered venture rounds following the "Series [Letter]" naming convention. Also included are venture rounds of unknown series, corporate venture and other rounds above $15 million. Corporate rounds are only included if a company has raised an equity funding at seed through a venture series funding round. Technology growth is a private-equity round raised by a company that has previously raised a "venture" round. (So basically, any round from the previously defined stages.)

In 2025 so far, 40% of VC exit value stems from AI, according to PitchBook | Fortune

It's all happening in AI (and, yes, that's a Simon and Garfunkel reference). And if that's an exaggeration, it barely feels like one: In Q3, AI amounted to 39.5% of deal count, a record, according to PitchBook. AI is sending U.S. dealmaking trends up, as PitchBook estimates that deal count is up about 8% this year, marking the third most active year of the last decade. And when it comes to deal value, the numbers are even more dominant: By Q3 2025, 64.3% of deal value in the U.S. has tracked to AI. Now, the definition of "AI" is pretty broad, but a now undeniable reality has taken hold. "I think AI has basically become the foundation of VC," said Kyle Stanford, PitchBook director of U.S. venture research, via email. "It provides a wholly new way for companies to solve challenges, and it is being integrated into every part of the economy. It is still the easy and fast deployment that can drive hyper scaling that VC has looked to for outsized returns. As mentioned above, it's not a singular technology or subset of companies within a broader industry; it is becoming part of everything." This follows through to the much-discussed and long-suffering VC exit environment: In 2025 so far, 40% of the exit deal value also traces back to AI, among them CoreWeave's IPO. PitchBook says 2025 has seen a record 317 AI exits. But the environment for IPOs and M&A remains dicey, according to PitchBook's Stanford. "Exit value is interesting because you have a few strong IPOs, and then quite a few IPOs that maybe got higher billing for the year because of the overall lack of exits," he told Fortune. "I don't think many share my view on the IPO market, but I question its real strength given the relatively small pipeline...Many of the IPOs have been crypto firms or companies that might be considered atypical for the overall VC-backed inventory. I do think that the extended period staying private (over the past three years) will lead to some very strong companies listing next year." Whether such an over-reliance on AI is healthy for the VC industry is an open question. And of course, intertwined in that question is the ongoing debate du jour: Are we in a bubble? If we are, what does that even mean? Stanford says he believes the conversation around a bubble should be nuanced. "This hype cycle, or bubble, might drive more tail events," he said. "The multiples being given to some companies are very high, which might be concerning, but if this is truly the technological shift it is being billed as, then companies shouldn't be priced in a normal way." A thought to this end from Brent Hill, managing partner at Origin Ventures, which just raised a $140 million sixth fund: "The U.S. economy has gone through five major economic eras: agrarian, industrial, information, digital -- and now, of course, we're living in the fifth and maybe most consequential with the artificial intelligence economy." This ongoing phase will be massive, Hill reckons, noting that "we think that over the next ten years, we'll see a dramatic impact in the productivity of the U.S. economy that will add somewhere between $2 trillion and $4 trillion to domestic GDP." There remains, of course, the question of how unprecedented VC's all-in reliance on AI really is. We see lots of corollaries to the dotcom bubble, perhaps -- but venture was a far smaller, less mature industry then. Karen Page, general partner at B Capital, thinks it's worth considering the cloud boom. "Cloud was a fundamental shift -- a different way to own your data, to run your data," she said. "But even so, AI is a different way to access your data. So, this is still leaps and bounds more of a transition." There was always, during cloud hype, a sense that brakes were getting pumped. Not so in AI: "There is no fear around AI," Page said. "There is, instead of fear, a desire to jump in and move fast. So, it's very different." All in all, she and I ultimately settled on the word "unprecedented."

AI drives 38% surge in global venture capital funding as third quarter hits $97B - SiliconANGLE

AI drives 38% surge in global venture capital funding as third quarter hits $97B Global venture capital activity surged in the third quarter of 2025, with total funding reaching $97 billion, up 38% year-over-year, according to a new report released today by Crunchbase Inc. The $97 billion raised in the quarter was slightly ahead of the $92 billion raised in the second quarter. The quarter was also the fourth consecutive quarter that global venture funding has exceeded $90 billion -- levels that have not been seen since 2022. The funding rebound was, not surprisingly, driven largely by a handful of artificial intelligence companies, which collectively secured some of the largest financings of the year. Anthropic PBC led the way with a $13 billion round, followed by xAI Inc. with $5.3 billion and Mistral AI Inc. with $2 billion. Other billion-dollar deals went to Princeton Digital Group Inc., Nscale Inc., Cerebras Systems Inc., Figure AI Inc., Databricks Inc. and PsiQuantum Corp., reflecting sustained investor appetite for AI infrastructure and advanced computing. The data from Crunchbase shows a rising concentration of capital, with roughly a third of all global venture investment -- 30% to 33% -- flowing into rounds of $500 million or more. In the third quarter, 18 companies accounted for a full third of all venture capital raised. Nearly half of all VC dollars -- $45 billion, or 46% of the total -- went to the AI sector, with Anthropic alone capturing 29% of global venture investment for the quarter. After AI, hardware was the second-largest VC funded sector in the quarter, coming in at $16.3 billion thanks to investments in robotics, semiconductors, quantum and data center infrastructure. Healthcare and biotech came in at third place with $15.9 billion in funding, while financial services sat at fourth position with $12 billion raised. In another positive sign, exit activity in the third quarter rose for the second straight quarter, with venture-backed initial public offerings rising year-over-year, led by Chery Automobile Co. Ltd., Figma Inc., Klarna Bank AB and Netskope Inc. Sixteen companies went public in the quarter with valuations above $1 billion, collectively worth more than $90 billion at offering prices. Merger and acquisition activity was also strong in the quarter, coming in at $28 billion, down from $51.7 billion in the second quarter but still strong by historical standards. Ten companies were acquired for more than $1 billion each, including notable deals such as OpenAI's acquisition of Statsig Inc. and Workday Inc.'s purchase of Sana Labs AB.

AI delivers record share of venture deal value in third quarter as fundraising slump continues - SiliconANGLE

AI delivers record share of venture deal value in third quarter as fundraising slump continues The global venture capital market held steady in the third quarter of 2025, propped up by artificial intelligence investments, but the recovery is narrow, concentrated in big rounds and exits. As a result, fundraising remains at decade-low levels, handing leverage to investors with dry powder, according to a first look at the quarterly PitchBook-NVCA Venture Monitor report released early Friday. In the third quarter of 2025, 64% of venture capital deal value went into AI companies, a record percentage. Only software-as-a-service and big data, both closely linked to AI, surpassed $25 billion in total investments this year. Fueled by AI, U.S. dealmaking is on track for a roughly 8% increase in total deal count over 2024, the report says, potentially making it the third most active year in the past decade. Exit activity in the U.S., particularly initial public offerings, was down in exit value from the second quarter but ranked as the second-highest valued quarter since 2021. Public listings, including reverse mergers, generated more value through the third quarter than mergers and acquisitions, despite mergers and acquisitions already exceeding 2024 levels. Not surprisingly, AI had a significant influence on exit numbers. In 2025, 40% of exit value has come from AI, with notable exits from companies like CoreWeave Inc., which went public in March. The 317 exits by AI startups have already set a record, highlighting investor enthusiasm for the sector across all markets. Through the quarter, $47.8 billion in new commitments have been raised by venture capital firms, with only 378 new funds closed. The U.S. fundraising market has remained stagnant this year due to liquidity shortages and uncertainties surrounding dealmaking. Though numbers may be down, there is hope: PitchBook noted that ongoing capital calls fueling the AI investment surge are likely to increase pressure on funds, drawing down their dry powder. And as exit markets start to open, the added liquidity is expected to facilitate capital recycling into VC, although the added liquidity may be selective. Europe and other regions tell a related but distinct story: AI is lifting deal value there as well, but fewer megarounds mean exits remain driven more by mergers and acquisitions than by public windows and fundraising sits at the lowest pace in a decade. The report argues that reopening IPO markets and larger cross-border listings would be critical to restore much-needed growth capital for the continent's scaling companies. In Asia and Latin America, activity in the quarter was patchy. Supply chain and manufacturing plays have climbed the sector rankings even as many markets contend with tariff uncertainty, reduced liquidity and a few outsized deals accounting for most regional totals. The key takeaways from the report for founders and limited partnerships are simple and stark: Capital is available but highly selective. Teams building genuinely differentiated AI primitives, horizontal platforms, or mission-critical vertical solutions will find buyers and favorable exits, whereas everyone else will face tighter terms and longer fundraising cycles.

AI venture funding continued to surge in third quarter, data shows

About 46% of global venture funding for the third quarter went towards funding AI companies, with 29% invested in solely Anthropic. The three largest venture rounds in the quarter ended September were raised by foundation model companies: $13 billion by Anthropic, $5.3 billion by xAI and $2 billion from Mistral AI. As the rush towards AI-related companies continues on Wall Street, data from Crunchbase showed on Monday that the sector enjoyed a bulk of venture funding in the third quarter, with names including Anthropic raking in billions. By the numbers Global venture funding in the third quarter increased 38% year-over-year to $97 billion, increasing slightly from $92 billion in the second quarter. About 46% of global venture funding for the third quarter went towards funding AI companies, with 29% invested in solely Anthropic. The three largest venture rounds in the quarter ended September were raised by foundation model companies: $13 billion by Anthropic, $5.3 billion by xAI and $2 billion from Mistral AI. Why it's important? The craze for AI-related companies has swept across Wall Street this year and was largely responsible for pushing the main stock indexes to record highs. ChatGPT-parent OpenAI reportedly became the most valuable private company in the world last week with a valuation of $500 billion. Crunchbase data shows other private players in the AI chatbot space were leading funding in the last quarter. Funding for US companies dominated in the quarter, with $60 billion worth of global venture capital going to US-based companies. Other sectors Funding for the hardware sector was the second-largest in the quarter, with large rounds raised by robotic, semiconductor, quantum and data infrastructure companies totaling $16.2 billion, according to Crunchbase's data. Healthcare and biotech raised $15.8 billion in venture funding, making it the third-largest sector in the quarter.

AI Soaks Up Record VC Dollars, Leaving Other Industries on the Sidelines | PYMNTS.com

By completing this form, you agree to receive marketing communications from PYMNTS and to the sharing of your information with our sponsor, if applicable, in accordance with our Privacy Policy and Terms and Conditions. "You're in AI, or you're not. You're a big firm, or you're not," said Kyle Sanford, director of research at PitchBook. His comment captures a venture market increasingly divided between a handful of AI giants and everyone else. The leaders are pulling in historic rounds. Anthropic closed a multibillion-dollar raise this quarter at a valuation above $180 billion, while Elon Musk's xAI also secured billions. Vercel raised $300 million at a $9.3 billion valuation, Supabase raised $100 million at $5 billion, and DualEntry pulled in $90 million in its Series A. Anaconda raised $150 million in July. These deals show how capital is clustering around infrastructure and developer platforms that are seen as central to AI's future. Behind the surge in AI investment lies a structural shift. Just 823 funds raised $80 billion globally in 2025, a steep fall from 4,430 funds raising $412 billion in 2022, according to Bloomberg. With fewer pools of capital, the pipeline of early-stage startups risks thinning out, as investors concentrate larger checks into established names rather than seed or Series A bets that could have grown into the next Anthropic or Stripe. "Backers of venture funds and partners of VC firms are being more deliberate about where they're putting their money," Sanford said. Increasingly, that deliberation means writing bigger checks into fewer firms with clear AI exposure. The shift reflects not only risk aversion but also limited partner pressure to show near-term results, and it raises concerns that the next generation of early-stage founders could be crowded out before they even get started. Bloomberg has reported that AI is already siphoning venture dollars away from other technology sectors, making it harder for non-AI startups to raise capital. At the same time, AI is among the most capital-intensive industries in tech. Citi projects that global spending on AI infrastructure could exceed $2.8 trillion through 2029. That pull is drawing capital not only to model developers but also to adjacent players in chips, cloud, and physical infrastructure. The result is a market where AI platforms and infrastructure startups are flush with resources, while companies in sectors like healthcare, mobility, and climate face slower deal cycles and smaller rounds. CFOs are also adding restraint. According to PYMNTS Intelligence, only 26.7 percent of finance leaders plan to increase generative AI budgets in 2026, down from 53.3 percent a year earlier. Half of firms reporting strong returns will expand spending, while just 16.7 percent of those seeing negligible ROI intend to do so. That split reflects what PYMNTS has called the ROI paradox: adoption is soaring, with infrastructure spending forecast to reach trillions, but the economics have yet to catch up. For now, AI dominates venture capital in scale and in focus. The money is flowing to a few large players while the rest of the industries see funding pools shrink.