Investment in artificial intelligence (AI) startups surged to $24 billion between April and June, more than double the amount from the previous quarter, highlighting growing demand for the new technology, according to Crunchbase data.
Total funding for startups reached $79 billion, up 16% quarter-over-quarter, primarily driven by investments in AI, making it the largest sector for the first time, followed by healthcare and biotech.
Why is that important?
The runaway success of OpenAI’s ChatGPT has ignited a race to bring cutting-edge AI techniques to business productivity, healthcare, manufacturing and other fields. But investors and big tech companies say the big benefits from huge investments in AI are likely years away from being realized.
By the numbers
Five of the six billion-dollar funding rounds went to AI companies.
Top deals include Elon Musk’s xAI, which raised $6 billion, and AI infrastructure provider CoreWeave, which raised $1.1 billion in its latest funding round. Also on the list are self-driving company Wayve and data preparation company Scale AI.
Outside of AI, cybersecurity company Wiz raised $1 billion in its latest funding round.
The broader picture
Despite the increase last quarter, startup funding remains low compared to levels over the past three years.
Global fundraising fell 5% to $147 billion in the first half of this year, according to Crunchbase, and was flat compared to the second half of 2023.
Tight U.S. monetary policy has slowed a recovery in initial public offerings, hampering one of the biggest sources of revenue for institutional investors who typically invest in start-ups and sell shares at IPOs.
(Except for the headline, this story has not been edited by NDTV staff and is published from a syndicated feed.)
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