In the first quarter 2025, AI commanded 71% of the value of venture capital, according to PitchBook
The venture capital market reminds me of mountain climbing, but probably not what you imagine.
Think about that moment right after you are sitting and leashing. The car climbs – click, click, click – and work your way up, waiting for you to apologize every minute. But what if this decline never realizes? What if you are stuck upwards?
VC is now climbing climbing. There is AI optimism, there is a flow of transaction and a durable sense of purpose, but the payout remains for one reason or another. Take the IPO: Klarna, Coreweave and Health Health provided everything for a quick consecutive disclosure. Coreweave took a diving, only to have a market in the markets with Trump-stipulated tariff news. Health of Klarna and Soul? After that, they have allegedly supported an indefinite period.
In the meantime, AI is a dominant power and market power. This seems obvious enough, but when the data comes out, it is so sharp that it is repeated: for Q1 2025, AI has accounted for 71% of the total value of the VC transaction, according to new pitch book data. This is significantly on the right track last year from 46.8%. This includes anthropic $ 4.5 billion value, $ 1.5 billion for Groq Saudi Arabia fuel, Infinite Reality 3 billion dollar rounds and Openai incomparable $ 40 billion rounds of private funding. CVCs work in locks, 41% of their Q1 transactions focus on AI, Pitchbook mediates.
But looking at other numbers, cracks start to show. M&A has taken place, including some very high-level mergers and A-Sina looking at you, Wiz-, but most mergers and acquisitions are wrong with smaller companies: Pitchbook estimates that 76% of the completed acquisitions happened before the acquired company raised B-series B. Larger exits. For the first time, for many, for many, the Pitchbook was counted for $ 3.8 billion, invested between 892 first transactions, which has fallen year by year compared to $ 4.1 billion in 2024.
Of course, there is good news when the $ 32 billion Wiz acquisition and the Coreweave IPO drumming more departure from the last quarter of 2021. But clarity is still difficult. This week I have thought a lot about United Airlines and two completely different scenarios that it described under my guidance. This resolute uncertainty seems like a wider microcosm.
This is the year of instruction. Untilrable volatility brings movement but not direction.
What, I think, is the reason why we feel as if we were on the ride.
See you tomorrow,
Allie Garfinkle
X: @Agarfinks
E -post: Alexandra.garfinkle@forne.com
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Nina Ajemian curated the part of the transactions of today's leaflet. Order HERETo.
This story was originally reflected Fortune.com
