Annual global VC investment already at a five-year high of $560.4 billion at mid-year: KPMG’s Venture Pulse

Highlights:

Global VC market sees $227.4 billion in investment in Q2’26 as mega AI deals continue
Top 10 VC deals in Q2’26 account for $105 billion in global investment

23 July 2026

The global venture capital (VC) market saw $227.4 billion in investment across 8,440 deals in Q2'26, making it the second-best quarter on record despite continuing geopolitical tensions and macroeconomic uncertainties. With six-months remaining, annual global VC investment is already at a five-year high of $560.4 billion, second only to the record $750.9 billion seen in 2021 according to the Q2’26 edition of Venture Pulse from KPMG Private Enterprise.

The record-pace of global VC investment reflects a continued surge in late-stage deals as VC investors continued to place very large bets on AI companies; US-based Anthropic attracted the largest deal ($65 billion) of Q2’26, followed by US-based Prometheus ($12 billion) and China-based DeepSeek ($7.4 billion). Global corporate venture capital (CVC) investment also was on a record pace, accounting for $149.1 billion in investment during the quarter.

On a regional basis, the Americas attracted $150.0 billion across 3,999 deals, well above historical norms. Of this total, the US accounted for $144.9 billion across 3,644 deals. Asia attracted the second highest level of VC investment globally, with $50.8 billion across 2,676 deals. Notably, this was Asia’s fifth consecutive quarter of growth and its strongest quarter since Q4'21. Much of Asia’s increase was fueled by a resurgence in VC investment in China, which attracted $35.1 billion in Q2’26 as it continued to recover after several years of challenging market conditions. VC investment in Europe remained stable at $25.6 billion across 1,636 deals.

Q2’26 global exit value ($1.9 trillion) shattered the previous record, driven by SpaceX’s $75 billion IPO exit - $85.7 billion after greenshoe options were exercised.

This is the year of AI – there are a lot of big bets happening right now. It is driving nearly every part of the market from total investment numbers to exit value. The question is whether the large AI companies will be able to live up to their enormous valuations. VC investors certainly think so.

Carolina de Oliveira

Global Lead of Emerging Giants

KPMG International

Q2'26 - Key highlights

After Q1’26, Q2’26 was the second strongest quarter for global VC investment ever, with $227.4 billion invested, despite deal volume dropping from 10,277 to 8,467 quarter-over-quarter – a low not seen since Q3’17.
At mid-year, total global VC investment for 2026 was already at $560.3 billion – higher than every full year on record except 2021.
The Americas attracted $150 billion across 3,999 deals in Q2’26, of which the US accounted for $144.9 billion across 3,644 deals.
VC investment in Asia rose for the fifth consecutive quarter in Q2’26, reaching an eighteen-quarter high of $50.8 billion.
Europe saw VC investment remains steady, with $25.6 billion in VC investment compared to the $26 billion it saw in Q1’26.
Global CVC-participating investment was $149.1 billion in Q2’26; of this, the Americas accounted for $95.6 billion (including $92.1 billion in the US), Asia saw an eighteen-quarter high of $36.4 billion, and Europe saw its best quarter since Q2’21 ($16.8 billion).
Global VC exit value more than quadrupled from $434.7 billion to $1.9 trillion quarter-over-quarter, despite the number of exits falling from 811 to 775; the US accounted for $1.8 trillion of this total, including SpaceX’s record IPO exit.
Global VC fundraising was at $98.8 billion at the end of Q2’26, well on the path to exceeding 2025’s decade low total of $145.9 billion, although fundraising volume remained very subdued at 727, compared to the already low 1,744 funds raised during all of 2025; large funds over $1 billion accounted for more than half of this total: $53.2 billion across 19 funds.

AI remains hottest sector for VC investment by far; defensetech remains strong as well

AI continued to power a large share of VC investment globally, including numerous $1 billion+ funding rounds. The US saw the largest raises of the quarter, including the $65 billion raise by Anthropic and the $12 billion raise by AI startup Prometheus. In Europe, the UK saw the largest AI funding rounds, including raises by AI-driven healthtech Isomorphic Labs ($2.1 billion), autonomous driving company Wayve ($1.3 billion), and AI research firm Ineffable Intelligence ($1.1 billion). In Asia, China attracted the largest share of investment, with LLMs DeepSeek and StepFun raising $7.4 billion and $2.5 billion respectively, and AI-powered social platform ByteDance raising $3 billion.

Defensetech companies also continued to attract significant attention globally given ongoing geopolitical uncertainties. During the quarter, US-based autonomous defense systems company Anduril Industries raised $5 billion, while Finland-based space intelligence company ICEYE raised $1.2 billion.

Q2’26 alone sees $1.9 trillion in exit value, exceeding previous annual high

Global VC-backed exit activity reached unprecedented levels in Q2'26, although the results were heavily skewed by the merger of SpaceX and xAI, and then the subsequent IPO of the combined company. In Q2’26 alone, global VC-backed exit value soared above the previous annual record of $1.5 trillion set in 2021, with $1.9 trillion across 775 exits. This brought the 2026 annual total to $2.3 trillion with six months left in the year. Exit activity in the US accounted for an incredibly large proportion of the world’s exit value in Q2’26 ($1.8 trillion), with $1.7 trillion of this coming through public listings – led by the record SpaceX IPO.

Exit value in other regions saw modest improvements to exit value quarter-over-quarter, although exit volume remained quite low. In Europe, exit value rose from $16.5 billion across 213 exits to $19.5 billion across 211 between Q1’26 and Q2’26, while Asia saw exit value rise from $54.9 billion across 173 exits to $56.9 billion across 152.

VC investment in the Americas remains high as US continues to see large AI megadeals

VC investment in the Americas reached $150 billion across 3,999 deals in Q2'26. The US dominated VC investment in the region, accounting for $144.9 billion across 3,644 deals, led by multi-billion dollar raises by AI companies Anthropic ($65 billion), Prometheus ($12 billion), and Anduril Industries ($5 billion). The strong VC funding despite soft deal volume reflects a continued rise in average deal sizes as VC investors continued to concentrate their capital on either AI companies, or mature companies with proven value.

Outside the US, Canada saw VC investment decline from $1.9 billion in Q1'26 to $1.5 billion in Q2'26, while Mexico saw investment slip from $461 million to $441 million and Brazil saw it increase from $335.9 million to $391.6 million over the same period.

European VC investment remains strong despite lower deal volume

In Q2'26, Europe saw $25.6 billion in VC investment across 1,636 deals. While investment was slightly shy of the $26.0 billion recorded in Q1'26, it remained well above historical averages and represented one of the region's strongest quarterly investment totals in several years. Deal activity, however, fell from 2,433 in Q1'26 to 1,636 in Q2'26, highlighting the continued preference of VC investors to focus their capital on a small number of high-quality transactions than on a broad spread of investments.

At the jurisdictional level, the UK continued to attract the largest share of VC funding in Europe during Q2’26; its $9.4 billion in VC investment across 411 deals was a very robust result compared to historical trends, despite a minor dip from $9.8 billion in Q1’26. The Nordics region came in second, attracting $4.6 billion in its strongest quarter since Q2'21. Germany remained resilient with $2.6 billion in VC investment, while France attracted $2.5 billion, Israel $1.7 billion, and Ireland $342.2 million.

Asia sees best quarter of VC investment since Q4'21 as China sees some recovery

VC investment in Asia rose for the fifth quarter in a row, reaching $50.8 billion across 2,676 deals in Q2’26. China saw VC investment surge to an eighteen-quarter high, including a large jump from $22.5 billion to $35.1 billion quarter-over-quarter amidst a strong quarter of very large megadeals, including DeepSeek ($7.4 billion), ByteDance ($3 billion) and StepFun ($2.5 billion).

India and Australia also saw VC investment rise – from $3.5 billion to $4.1 billion and from $1 billion to $1.2 billion respectively, while Japan saw VC investment soften somewhat from $1.8 billion to 1.2 billion. Although Japan bucked the downward deal volume trend, attracting 299 deals in Q2’26, compared to 275 in Q1’26.

AI expected to keep powering global VC investment in Q3’26

Heading into Q3’26, AI investment is expected to remain very hot as it continues to expand its reach across industries and verticals, and the perceived addressable markets for different solutions. With geopolitical tensions still high and many regions continuing to prioritize development of sovereign defense capabilities, defensetech investment is also expected to grow, particularly in areas like autonomous vehicles and systems, defense software, and space and satellite intelligence.

Fintech is also expected to remain a steady area for VC investment, especially in regions like Latin America and Africa, along with health and biotech.

The exit environment could get very interesting over the next quarter or two, but what will be even more interesting to watch is deal activity – including at early deal stages. It’s been supressed for quite a long time. As a significant amount of liquidity gets returned to the market, hopefully that will lead to an injection of fresh capital at early deal stages and a revitalization of some of the quieter parts of the VC ecosystem that have been overshadowed by AI. Although some of that will likely be contingent on the geopolitical environment stabilizing.

Conor Moore

Global Head of KPMG Private Enterprise

KPMG International

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