If you’re not an AI startup, good luck raising money from VCs

Recent data from PitchBook reveals a striking trend in venture capital investments, indicating that artificial intelligence (AI) is becoming the focal point for funding in the startup ecosystem. Projections suggest that by 2025, AI will command over half of all venture capital investment, marking a significant shift in the industry. As of now, venture capitalists have invested an impressive $192.7 billion into the AI sector this year, out of a total of $366.8 billion across all sectors, according to Bloomberg. The most recent quarter showcased AI's strength, as it comprised 62.7% of U.S. VC investments and 53.2% globally. Notably, substantial funding rounds are being directed toward prominent players such as Anthropic, which secured a remarkable $13 billion in its Series F funding round in September. In stark contrast to AI's booming success, the overall number of startups and venture funds attracting investments has reached a historic low. PitchBook reports a mere 823 funds raised worldwide thus far in 2025, a drastic decline from the 4,430 funds raised in 2022. Kyle Sanford, PitchBook’s director of research, commented on this growing disparity, noting that the investment landscape is increasingly “bifurcated.” He emphasized that startups are now defined by their affiliation with AI, distinguishing between those that are part of this emerging technology and those that are not, as well as differentiating between large firms and smaller entities.