Q4’24 Venture Pulse Report – Global trends

At a regional level, the Americas accounted for a significant amount of VC investment in Q4’24, driven in large part by a several large deals in the US. While Europe saw VC investment rise quarter-over-quarter, the total level of investment in the region remained relatively soft compared to other recent quarters. The UK accounted for the largest share of VC funding in the region, driven by a $1.3 billion raise by AI-enabler data platform company GreenScale.

Asia continued to see very soft levels of funding during Q4’24. A $1.1 billion raise by China-based clean energy developer CNNP Rich Energy accounted for the largest deal in Asia during the quarter.

The AI space globally attracted a major proportion of all global VC funding this quarter; Over $32 billion of this funding came from $1 billion+ deals, including Databrick’s $10 billion raise, a $6.6 billion raise by OpenAI, a $6 billion raise by xAI, a $5.6 billion raise by Waymo, a $4 billion raise by Anthropic, and a $1.3 billion raise by GreenScale. The US attracted the vast majority of AI investment this quarter, although all regions saw robust interest in AI-focused companies.

AI model and infrastructure companies attracted many of the quarter’s largest deals, as interest and competition in the space remained very hot. Startups focused on the application of AI to address specific challenges and industries also saw substantial interest from VC investors across regions during Q4’24. In addition to autonomous driving company Waymo’s large raise, a number of companies raised significant rounds, including Turkey-based marketing platform Insider ($500 million), UK-based travel and hospitality platform Lighthouse ($370 million),and China-based Didi Autonomous driving ($298 million).

During 2024, defense tech was very high on the radar of VC investors globally, attracting a record level of funding. With no end in sight for the conflicts in the Ukraine and the Middle East, and geopolitical tensions between other countries simmering, governments around the world have increasingly embraced working with defense tech companies, particularly those with AI-enabled defense tech solutions.

While historically there has been some stigma associated with defense tech companies, making it difficult for startups in the space to raise funds — particularly in Silicon Valley — times have changed in recent quarters. A number of defense tech companies have been quite successful in breaking preconceived notions about defense tech and raised major rounds. Niche funds have also emerged focused specifically on making defense tech investments.

Heading into 2025, there is growing optimism that global VC investment will continue to pick up, particularly if interest rates continue to fall and the exit environment perks up. In Q1’25, all eyes will be on the IPO market; with the US election complete, market conditions improving, and the successful post-IPO performance of companies like Reddit, Rubrik and Astera Labs, there is growing optimism that the exit market will see a resurgence in 2025. While it could take some time, should IPO exits materialize, activity across the VC market will likely pick up considerably. VC investment in AI will likely continue to outpace investment in all other sectors heading in to Q1’25, with investment continuing to broaden into a wider range of sub-sectors — such as industry solutions and AI-enabled robotics. Corporates will likely continue to drive a large share of AI funding as the large tech giants compete for prominence, and as industry players look to leverage AI to improve their operational efficiencies and provide more value to their customers. Areas like defense tech, health and biotech, cybersecurity, and alternative energy will likely also continue to attract interest from VC investors.