As the flow of venture capital to artificial intelligence and machine learning startups leaped by 72% in 2025, a notable milestone was reached: For the first time, more VC dollars went to such ventures than to all other sectors combined.
Global funding for AI startups was $270.2 billion, accounting for 52.7% of the total $512.6 billion in VC investments, according to an analysis by BestBrokers, a provider of information services for traders.
Despite the surge, the overall number of VC deals declined for a third consecutive year, especially in the fourth quarter, when the 9,844 registered deals were the fewest in any quarter since early 2020. And yet, it was in that recent fourth quarter that VC funding for AI and machine learning startups first surpassed all other VC investments.
Essentially, there are now fewer deals, but more big ones, mirroring a similar trend in M&A activity. The biggest came in the first quarter of 2025, when SoftBank invested $40 billion in OpenAI. It was the largest ever single investment in a private company. Another milestone occurred a few months later, when Thinking Machine Labs landed $2 billion in seed-stage funding, the most ever.
Other major deals included Meta’s $14.3 billion investment in Scale AI and Anthropic’s $13 billion funding round at a valuation of $183 billion.
“Venture capital firms have shifted into a more selective phase, focusing on startups with proven enterprise applications or those developing critical AI and cloud infrastructure,” wrote Paul Hoffman of BestBrokers.
Regionally, of the $270 billion VC firms invested in AI last year, 79.3% was in North America. Europe accounted for 13.6% and Asia for 5.7%, while Latin America was just 0.5%.
Hoffman noted that many of the most heavily funded startups, including Thinking Machine Labs and Safe Superintelligence, were founded by former OpenAI staffers. Calling it a clear indication of AI expertise clustering in elite startups, he added, “While this concentration is driving rapid technological advances in firms with the resources to support it, it is also intensifying competitive pressure on newer entrants.”
As recently as 2023, AI accounted for just over a quarter (27.5%) of global VC deal value. That share accelerated to 40% the following year and again to the 52.7% figure in 2025.
Meanwhile, on the exit side, the aggregate value of AI and machine learning exits was $242.4 billion, accounting for about 40% of all exit value. The corresponding figures for 2024 were just $73.6 billion and 22%.
