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In the third quarter of 2024, mega funding rounds in AI and mobility propelled the modest 2% quarter-over-quarter global growth in venture capital. The US remained a funding powerhouse with seven of the top 10 global deals of $1 billion or more. In Europe, persistent inflation and rising interest rates led to a funding downturn, particularly in the UK.
Seed- and late-stage deal sizes reported impressive quarterly growth—7% and 16%, respectively—thanks to sectors like AI and semiconductors. On the other hand, early-stage deal sizes shrank by 23% quarter-over-quarter. Much of this decline stems from a realtive slowdown in high-value rounds following xAI’s $6 billion deal in the second quarter.
Corporate venture capital (CVC) deal count dipped, reflecting corporate caution in uncertain times and fewer exit opportunities. The number of CVC investors remained stable, with new CVCs emerging in the advanced manufacturing services and energy sectors.
Generative AI funding slowed in the third quarter. However, that is to be expected, given the inherent volatility of a sector characterized by megadeals. Notably, funding in horizontal enterprise applications surged to $6.5 billion, marking a strategic shift as investors look to industry-specific solutions.
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First published in November 2024