Startup Funding Slows In February Amid Exit Uncertainty

Gené Teare @geneteare

Global venture funding totaled $19 billion in February, marking one of the slowest months for startup investment in the past year, according to Crunchbase data. AI and healthcare were the two leading sectors for investment, with hardware and manufacturing gaining in prominence.

The U.S. led monthly funding totals with just over $10 billion invested this past month — or 54% of global venture investment.

Monthly funding troughs have not been unprecedented since the market correction at the end of 2021. Startup investment in August 2024 also fell below $20 billion, as it did three months in 2023 (February, July and December).

However, the anticipated stock-market pickup in 2025 now looks more uncertain with the threat of stiff new U.S. tariffs impacting public tech stocks. The economic uncertainty could further erode venture investment in 2025.

AI led, with hardware and manufacturing increases

AI was the leading sector for venture capital investment in February, drawing $5.7 billion, or around 30% of global funding. Funding to healthcare and biotech totaled 22% of total investment.

Hardware received 18% of funding last month, with large rounds for data centers and robotics startups, while 15% of funding went to the manufacturing sector, where startups in defense and aerospace, and material science raised large rounds.

The largest round in February was a $600 million funding to Saronic, a producer of maritime unmanned surface vehicles for defense capabilities, led by Elad Gil of Gil Capital.

There were other large investments too. Endpoint management platform NinjaOne raised $500 million, Lambda raised $480 million for GPU training and inference, Eikon Therapeutics raised $351 million for drug discovery, and humanoid robot developer Apptronik raised $350 million. The majority of these larger rounds, except for NinjaOne’s, have a hardware and software component to their technology.

High-value rounds continue

Half of global venture investment, or around $9.7 billion, went to late-stage funding last month. Over $7 billion was invested in early-stage companies, and $2.3 billion was invested in seed-stage companies.

Interestingly, February saw no decline in the number of funding rounds valued at $1 billion or more, even as overall venture investment slowed. Twenty-one companies raised at billion-dollar-plus valuations, compared to 23 in January and 17 in February 2024.

Clearly, there is no shortage of growth equity funding to invest in large deals.

Methodology

The data contained in this report comes directly from Crunchbase, and is based on reported data. Data reported is as of March 4, 2025.

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.

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

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