Artificial intelligence startups drew the bulk of global venture capital investments in the first quarter of 2025, marking a sharp pivot from last year, according to new data from Pitchbook.
The report revealed that a staggering 57.9% of all global VC funding in Q1 went to AI and machine learning startups, more than double the 28% recorded in the same quarter of 2024. Pitchbook described the trend as a clear sign that
“investors still have an AI FOMO [fear of missing out] problem,”
as money continues to pour into the rapidly evolving sector.
In North America, the obsession with AI funding was even more pronounced. The report noted that 70% of all venture capital in the region flowed into AI ventures during the quarter.
Globally, AI startups raked in $73 billion in Q1—already more than half of 2024’s total AI deal value. This surge was primarily fueled by OpenAI’s $40 billion mega-round led by SoftBank, which closed on March 31. Other major deals included Anthropic’s $3.5 billion Series E round.
“The fear of somebody else winning your market has never been higher than it is now,”
said Maria Palma, general partner at Freestyle Capital.
“You haven’t seen a slowdown because the rate of change on the technology side is almost indigestible.”
Yet, not all investors are sold on the AI boom. Nnamdi Okike, co-founder and managing partner at 645 Ventures, warned of a growing disconnect between hype and reality.
“A lot of VC funds are just kind of saying, ‘Hey, this can only go up.’ And that’s usually a recipe for failure.”
Meanwhile, crypto and blockchain startups trailed far behind, attracting just $4.8 billion in venture capital during the same period, according to data from CryptoRank. Nearly half of that came from a $2 billion investment by Abu Dhabi-based MGX into Binance.
Still, it’s a step up for crypto. The sector’s Q1 numbers quadrupled from the $1.1 billion raised in Q4 2024 and marked the industry’s most active funding quarter since Q3 2022.
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