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Highlights:

• $126.3 billion in VC funding globally despite significant drop in deal volume
• US attracts a thirteen-quarter high of $91.5 billion in VC investment in Q1â€�25
• Asia-Pacific region sees VC investment fall to record low of $12.9 billion

• Global VC investment rose from $118.7 billion across 8,801 deals in Q4â€�24 to $126.3 billion across 7,551 deals in Q1â€�25.
• In the Americas, VC investment rose from $80.9 billion to $94.5 billion quarter-over-quarter—including from $77.2 billion to $91.5 billion in the US—while Europe saw VC investment remain relatively steady at $18 billion; the Asia-Pacific region saw both VC deal value and volume fall to record lows—dropping from $18.9 billion invested across 2,522 deals in Q4â€�24 to only $12.9 billion invested across 2,149 deals in Q1â€�25. 
• Global corporate VC investment rose from $69.4 billion in Q4â€�24 to $80.8 billion in Q1â€�25; the US accounted for the majority of investment during the quarter ($65.5 billion), driven by large megadeals. At the other end of the spectrum, CVC investment in the Asia-Pacific region fell to a 10 year low of $5.8 billion during Q1â€�25.
• The median deal size for Series D+ deals rose substantially in both the Americas and Europe—from $91.6 million to $96.2 million in the Americas and from $84.5 million to $177.5 million in Europe.
• Exit value remained relatively muted, with just $78.2 billion seen globally. On a regional basis, exit activity increased somewhat in the United States but fell to only $6.6 billion in Asia-Pacific—the lowest level of exit activity seen in the region since 2015.

AI remained the biggest ticket for VC investors globally in Q1�25, with the $40 billion raise by US-based Open AI breaking the record for the largest VC funding round ever recorded. During the quarter, US-based Anthropic and Infinite Reality also raised large rounds of $4.5 billion (two closings) and $3 billion respectively. Europe and the Asia-Pacific region also saw strong AI funding; in Europe, Sweden-based Neko Health raised $260 million and UK-based Synthesia raised $180 million, while in the Asia-Pacific region, China-based Neolix Technologies and Univista raised $137 million and $137 million respectively, Australia-based Harrison.ai raised $111 million, Hong Kong-based InSilico Medicine raised $100 million, and India-based Spotdraft raised $54 million.

During the quarter, China also saw three new AI models launched, including DeepSeek’s R1 AI model and new models by Tencent and Alibaba. The three models—all said to be more energy efficient than others on the market—further highlights the competitiveness of the AI space at the moment.

VC investment in the Americas reached a three-quarter high of $94.5 billion across 3,331 deals in Q1�25, driven primarily by activity in the US, which accounted for $91.5 billion across 3,003 deals. The quarter was marked by a wave of megadeals in the large language model (LLM) space, including the standout $40 billion raise by OpenAI. Despite the jump in total investment, deal volume declined for the fourth consecutive quarter, underscoring continued investor caution in the region. While VC investors had been optimistic following the US presidential election, renewed concerns over tariffs and related market volatility introduced fresh uncertainty that tempered momentum.

Outside the US, Canada saw muted VC activity amid its intensifying tariff dispute with the US; Total VC investment in Canada fell to just $917 million across 148 deals � levels not seen since early 2018. In Latin America, Mexico saw VC investment drop from $626 million to $281 million quarter-over-quarter, although deal volume remained relatively resilient. Conversely, Brazil saw an uptick in VC funding—from $464 million in Q4�24 to $562 million in Q1�25, supported by strong CVC activity.

VC investment in Europe held steady in Q1�25 at $18 billion, although deal volume declined from 2,314 to 1,883 quarter-over-quarter. A growth in megadeals—including five transactions over $500 million (up from just one in Q4)—highlighted the shifting focus among VC investors towards larger, later-stage opportunities. These large megadeals included Binance ($2 billion), Reneo ($624 million), Isomorphic Labs ($600), Rapyd Financial ($500 million), and Ori ($500 million). The UK led the region with $5.5 billion in VC investment, followed by Germany ($2.2 billion) and France ($1.7 billion).

Deal volume in Europe fell to a six-year low amid renewed geopolitical and economic uncertainty, partly driven by new tariff policies announced by the US administration. Investors in Europe continued to show a clear preference for established startups with proven traction, given the ongoing market volatility and continued lack of IPO activity. AI remained a key area of focus for VC investors, particularly in areas related to industry-specific applications. Interest in the AI sector was further supported by new funding initiatives announced by the EU and various member states aimed at strengthening the regional AI ecosystem.

VC investment and deal volume in the Asia Pacific region dropped to $12.9 billion in investment across 2,149 deals in Q1�25 � the lowest levels the region has seen in over ten years. VC funding dropped consistently across the region, with China seeing a drop from $10.9 billion to $6 billion quarter-over-quarter, India seeing a decline from $2.6 billion to $2.4 billion, and Japan seeing a drop from $1.1 billion to $900 million. Singapore was the sole bright spot in the region in Q1�25, with VC investment rising from $880 million to $1.7 billion � driven primarily by a $1.2 billion raise by Singapore-based DayOne. DayOne’s raise was the largest deal in the region during the quarter, followed distantly by a $688 million raise by China-based SE Environment, and a $550 million raise by India-based retailer Meesho.

VC investment is expected to be quite subdued in Q2�25 as investors remain cautious amid continued concerns over a potential trade war and ongoing geopolitical uncertainty. Many VC investors are taking a wait-and-see approach, holding off on major investments until there is greater clarity in the global economic environment.

The AI space will likely remain a key exception; despite the global geopolitical uncertainty, AI is expected to continue to attract sizeable deals during the quarter. Industry-specific AI solutions are expected to attract increasing levels of investment, alongside advanced robotics and supporting technologies � such as LIDAR � which enhance the effectiveness of autonomous systems. In light of geopolitical tensions, defence tech and cybersecurity are also likely to see increasing attention from VC investors.

Global M&A activity could accelerate over the next few quarters, especially in the AI sector. Large technology firms are expected to pursue strategic acquisitions to secure emerging AI capabilities before valuations soar. Additionally, companies seeking alternatives to a volatile IPO market may increasingly view M&A as a more stable exit route.

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