Venture Funding Skyrockets As Global Startups Receive Record-Breaking 744 Billion

The global venture funding market experienced significant growth in 2024, with a total of $744 billion invested in startups and early-stage companies. This represents a 14% increase from the previous year’s total of $651 billion.

The US was the largest beneficiary of this growth, accounting for 57% of global venture funding, with a total of $178 billion invested. The San Francisco Bay Area was particularly active, with $90 billion in funding going to companies based there.

Late-stage funding, which includes Series C and later rounds, increased by 70% compared to the same quarter last year, reaching $61 billion. This surge in late-stage funding was driven by large fundings in sectors such as AI, applied AI, energy, semiconductor, banking, security, and aerospace.

Early-stage funding, on the other hand, remained relatively flat, with a total of $35 billion invested. The largest early-stage rounds went to data centers, renewable energy, AI, robotics, and biotech companies.

Seed funding trailed behind in Q4, reaching $7 billion, which is down 16% from the previous year’s $8.4 billion. However, seed fundings are often added to the Crunchbase dataset after the close of a quarter, so this figure may increase over time.

Liquidity, or the ability for companies to raise capital by selling shares or assets, remained slow in 2024. M&A activity was slightly up compared to the previous year but was still slower than expected and concentrated in biotechnology and cybersecurity companies.

The IPO market also experienced a slow start to 2024, with only a few listings. Notable exceptions included the ServiceTitan IPO, which saw its stock price increase by over 40% compared to its IPO price.

According to Beezer Clarkson, a partner at Sapphire Ventures, “History just shows very clearly that when there’s positive liquidity, more money goes into venture funds.” She believes that as the IPO market opens up in 2025, more investors will be drawn to venture capital, driving LP allocation and increasing funding for startups.

Data from Crunchbase provides insights into specific deals, including OpenAI’s $157 billion valuation, Databricks’ $62 billion valuation, xAI’s doubled valuation to $50 billion in a six-month period, Waymo’s at least $4 billion raise, and Anthropic’s at least $4 billion raise. These deals demonstrate the ongoing focus on AI and technology among investors, as well as growing interest in companies driving innovation and growth.

The surge in late-stage funding was driven by large investments in sectors like AI, applied AI, energy, semiconductor, banking, security, and aerospace. Early-stage funding remained relatively flat, with largest rounds going to data centers, renewable energy, AI, robotics, and biotech companies.