Global VC Funding Isn’t Slowing, But It’s Not Growing Either, April Numbers Show

Global venture capital funding reached just over $22 billion in April 2024 — flat month over month and up a few percentage points year over year — Crunchbase data shows.

The slowdown in venture funding has continued despite the AI technology wave that has washed over startups in the past few years.

Of the $22 billion invested in startups globally last month, around $2.4 billion, or 11%, went to about 1,000 seed-stage companies. Around 500 early-stage companies raised $9 billion globally in April.

And more than 150 companies from Series C onward raised $10.7 billion, representing about 49% of funding last month, Crunchbase data shows. Those amounts are in line with funding at those stages in April 2023.

Big deals

The largest startup funding round in April was a $1 billion deal to stealth startup Xaira Therapeutics for drug development using AI. Large fundings were also raised by several deeptech and energy sustainability companies: electric vehicle developer Hozon; solar provider Pine Gate Renewables; and quantum computing company PsiQuantum.

Top sectors

Biotech and healthcare was the leading sector by funding amount in April. Companies in that space raised $5.7 billion, or around 26% of all funding, according to Crunchbase data.

AI companies raised $3.9 billion, or about 17% of funding last month. Besides Xaira, notable fundings were raised by AI coding assistants Augment and Cognition, the latter of which claims to have created the first AI engineering teammate, named Devin.

Other leading sectors in April include hardware startups, which collectively raised $3.3 billion; manufacturing ($2.9 billion); and financial services companies ($2.9 billion).

Looking to the public markets

The Rubrik IPO in April marked the third venture-backed private company to list at a value above $5 billion this year so far, compared to two companies for all of 2023. That is an increase over 2023, but still too few companies to suggest the public markets are truly opening.

Recent market cap increases in the public markets have swayed largely toward big tech, with many listings from 2021 — the most active year for IPOs on record —  trailing behind their first-day peaks.

Not growing, not slowing

The launch of generative AI has led to the creation of new startups in this cycle. However, larger private software companies are adapting quickly to this new technology cycle. In many ways, the AI revolution stands to benefit incumbents who raised large amounts of capital in the prior venture cycle and are adding AI into products with existing customers, while cutting costs in other areas to reallocate to AI efforts.

Big tech has stepped in to compete, with the billions required to fund this leap, while some generative AI startups struggle to pay those bills.

For now, venture is still in the midst of a reset with valuations settling and the exploration of new AI use cases while startups increase their spend on cloud and GPUs.

Methodology

The data contained in this report comes directly from Crunchbase, and is based on reported data. Data reported is as of May 6, 2024.

Note that data lags are most pronounced at the earliest stages of venture activity, with seed funding amounts increasing significantly after the end of a quarter/year.

Industries in Crunchbase are not exclusive. A company can be in more than one industry and in more than one industry group.

Please note that all funding values are given in U.S. dollars unless otherwise noted. Crunchbase converts foreign currencies to U.S. dollars at the prevailing spot rate from the date funding rounds, acquisitions, IPOs and other financial events are reported. Even if those events were added to Crunchbase long after the event was announced, foreign currency transactions are converted at the historic spot price.

Glossary of funding terms

As of January 2023, we have made a change to how we include corporate funding rounds in our reporting. Corporate rounds are only included if a company has raised an equity funding at seed through a venture series funding round.

Seed and angel consists of seed, pre-seed and angel rounds. Crunchbase also includes venture rounds of unknown series, equity crowdfunding and convertible notes at $3 million (USD or as-converted USD equivalent) or less.

Early-stage consists of Series A and Series B rounds, as well as other round types. Crunchbase includes venture rounds of unknown series, corporate venture and other rounds above $3 million, and those less than or equal to $15 million.

Late-stage consists of Series C, Series D, Series E and later-lettered venture rounds following the “Series [Letter]” naming convention. Also included are venture rounds of unknown series, corporate venture and other rounds above $15 million.

Technology growth is a private-equity round raised by a company that has previously raised a “venture” round. (So basically, any round from the previously defined stages.)

Illustration: Dom Guzman