Venture Pulse Q1 2026
The Venture Pulse report provides insights around trends, opportunities, and challenges in the US venture capital market.
VC investment in the US soared to a record high of $267.2 billion in Q1’26, powered by the $122 billion raise by OpenAI. Even taking this major outlier deal out of the mix, VC funding in the US would have reached a new record. The quarter also saw the largest number of $10 billion+ VC megadeals in the US ever; in addition to OpenAI, Anthropic raised $30.6 billion, xAI raised $20 billion, and autonomous driving and ride hailing company Waymo raised $16 billion.
In the US in Q1’26
- VC investment hits a record $267.2B, led by AI
- Four $10B+ AI megadeals reshape market dynamics
- Median deal sizes rise across stages, driven by late‑stage rounds
- IPO market pauses amid geopolitical conflict
- LPs concentrate capital in established, large funds
Interest in AI continues to surge in the US
VC investors in the US continued to pour money into the AI space during Q1’26. While the largest portion of this investment went to three large LLMs — OpenAI, Anthropic, and xAI — other AI-focused companies raised $1 billion+ rounds during the quarter, including data platform company Databricks ($7 billion), robotics-focused Skild AI ($1.4 billion), chip manufacturer Cerebras Systems ($1.1 billion), and spatial intelligence company World Labs ($1 billion).
Industry and vertical solutions remained a significant priority for VC investors during the quarter. The large LLMs have also increasingly focused on developing industry-specific solutions; for example, during Q1’26, Anthropic launched a legal plug-in aimed at automating activities to help improve legal workflows.1
IPO market in the US grinds to a halt amid Middle East conflict
Entering 2026, a steady stream of IPO exits was expected in the US — and for the first two months of the year, activity proved to be solid. In January, construction equipment rental company EquipmentShare raised $747 million on the Nasdaq, with shares rising 16.3% on the first day of trading, while satellite manufacturer York Space Systems raised $629 million and digital asset infrastructure company BitGo raised $212.8 billion — both on the NYSE. Several biotech companies also held successful IPOs early in Q1’26, including Eikon Therapeutics, which raised $381 million, Aktis Oncology, which raised $318 million, and Veradermics, which raised $256 million.2
The conflict in the Middle East in late February, however, brought the IPO market in the US to a grinding halt. While there is hope that should the conflict be resolved quickly, the IPO market could quickly heat back up again, a protracted war would likely put any near-term recovery into doubt given increasing market uncertainties and the rapid rise in oil and gas costs.
Fundraising activity strengthens in Q1’26
US-based fundraising activity grew significantly in Q1’26, with $47.8 billion in funds raised by the end of Q1’26 — more than half of total raised during each of the last three years. Fundraising was heavily concentrated at the top end of the market, with funds over $1 billion driving most of the total raised in the US. The growth in fundraising dollars reflects increasing capital intensity-particularly in AI-and the belief that more value is accruing in private markets, prompting investors to concentrate capital with managers they believe are best positioned to back the next generation of category‑defining companies.
Trends to watch for in Q2’26
There is a looming cloud of uncertainty in the US VC market heading into Q2’26, given the conflict in the Middle East and the sudden surge in oil and gas prices. In particular, IPO activity is expected to remain soft; while sectors like cybersecurity and defense tech see exceptions, the majority of companies looking for IPO exits will likely delay plans until there is a significant de-escalation in the conflict. Meanwhile, M&A activity will likely continue at a solid pace, driven in part by AI-focused acquisitions.
AI is expected to remain the hottest area of VC investment in the US during Q2’26. Given the level of geopolitical tensions and conflicts, defense tech and spacetech continue to be very attractive to VC investors in the US.
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Venture Pulse Q1 2026
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A global overview of key findings uncovered from the Q1’26 Venture Pulse Report.
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