Global VC investment climbs to five quarter high
VC investment globally rose from $75.3 billion in Q1’24 to $94.3 billion in Q2’24, driven primarily by a near-record number of $1 billion+ megadeals.. AI continued to be the largest ticket across jurisdictions as investors continued to place big bets on the transformative power of artificial intelligence. The largest AI investments targeted startups focused on large language models and those looking to bring the power of AI to specific industries or functions, including health and biotech or supply chain logistics. Outside of AI, energy and cleantech remained attractive to VC investors globally, in addition to fintech and B2B solutions.
AI helps drive VC investment in the US to eight-quarter high
Q2’24 saw VC investment in the US rise to $55.6 billion — the highest level since Q2’22 — driven in large part by major mega-deals in the AI space, including an $8.6 billion raise by cloud AI provider CoreWeave and a $6 billion raise by AI systems company xAI. Valuations within the AI space continued to be exceptionally strong compared to other industries, evidenced by the median valuation of AI companies growing significantly in recent quarters. Given some of the big bets being made in the AI space in the US, the fear-of-missing-out (FOMO) was likely a contributor to the strength of VC investment in AI this quarter.
Americas sees strong uptick in VC investment in Q2’24
VC investment in the Americas rose to an eight-quarter high of $58.3 billion in Q2’24, driven in part by a resurgence in $100 million mega-deals in the US. VC investment outside the US remained subdued compared to historical norms, despite strong increases quarter-over-quarter in Canada, Brazil, and Mexico. In Canada, VC investment rose from $783 million in Q1’24 to $1.3 billion in Q2’24, while in Brazil, VC investment rose from $352.8 million to $816.8 million. In Mexico, VC investment rose dramatically, from a mere $33 million to $225.9 million quarter-over-quarter.
VC investment in Europe rises to $17.8 billion in Q2’24
VC investment in Europe rose quarter-over-quarter — from $13.9 billion in Q1’24 to $17.8 billion in Q2’24, driven by a solid uptick in mega-deals, including a $1 billion funding round by AI autonomous driving technology company Wayve, a $999.6 million raise by consumer lending platform Abound, a $650.6 million raise by LLM-focused Mistral AI,10 and a $621 million raise by neobank Monzo.
Soft investment in China pulls VC investment in Asia down
VC investment in Asia fell from $20.8 billion to $17.4 billion between Q1’24 and Q2’24. A very quiet quarter of investment in China was primarily responsible for the decline as a number of other jurisdictions within Asia saw VC investment rise between Q1’24 and Q2’24, including India, Singapore, and Japan.