Global Venture Capital Funding in 2024 slightly exceeded 2023 totals, with AI showing the largest increase in terms of year-over-year amounts. The trend continued in the second quarter of this year, when global financing reached 91 billion dollarsaccording to Crunchbase data – an 11% year-over-year increase.
Overall, the first half of 2025 This is the strongest half-year for global venture capital investment since the first six months of 2022, signaling a tepid recovery in private markets.
But what does he have in store for the rest of 2025? Will we continue to see venture capital funding increase, led by AI? What kind of impact will the wave of IPOs we’ve seen so far this year have on private markets?
To get an idea of what lies ahead, Crunchbase News spoke with early-stage investors from four venture capital firms: Menlo Ventures, Founders Fund, Bain Capital Ventures And Capital of the left lane.
Not surprisingly, AI was a dominant theme. But opinions differed on the extent to which it would continue to dominate.
Let’s go.
AI momentum continues
Matt Murphypartner at San Francisco-based Menlo Ventures, believes funding is exploding because “everyone is chasing the AI wave and many companies that started late are catching up.”
According to him, it is still only the beginning of the round. The funding trend will only accelerate through the end of the year, mainly driven by a wide range of AI application and infrastructure companies “experiencing unprecedented growth.”
For its part, Menlo entered the AI space by writing its first check to startup GenAI and OpenAI competitor Anthropicit is May 2023 $450 million Series C round. In May 2024, Menlo announced the launch of its $100 million AI fund – named Anthology Fund – in partnership with Anthropic.
Murphy calls the venture “a huge success,” with more than 30 companies moving from seed to Series A.
“We couldn’t be more excited about the coming quarters in the venture capital market, as AI models become more powerful and more entrepreneurs launch into new and existing categories,” he predicted. “The pace of change in workflows, productivity and innovation will be unprecedented. »
Robert WindesheimSan Francisco-based Founders Fund’s latest investor agrees that AI “provides significant tailwinds,” calling it “the most important technology since the Internet.”
He believes that the AI boom is the main driver for the increased deployment of capital – from venture capital funding to IPOs and public markets in general.
“I expect this to continue over the next 12 to 18 months as models continue to improve and new use cases are unlocked,” he told Crunchbase News. “More recently, reinforcement learning on domain-specific data has opened up new product opportunities.”
“All about AI”
Windesheim said that despite all the frenzy around AI, the San Francisco-based company is trying to “stay aware of the overhyped AI cycles,” choosing to be “very deliberate in supporting certain companies in a vertical.”
For example, he noted, Founders Fund only supported OpenAI among multiple foundation model labs.
He concedes, however, that “AI will continue to play a very important role and will open up new opportunities” in the world of venture capital.
Menlo’s Murphy agrees, noting that everything his company pursues “has a strong component of AI as a differentiator.”
“So for us, we’re really all-in on AI,” he told Crunchbase News.
This means it may be more difficult for non-AI companies to raise funds.
“But good companies will always be able to raise capital,” he acknowledged. “Defense technology is another growing area outside of your more traditional AI applications and infrastructure.”
Partner at Bain Capital Ventures Abby Meyers agrees that AI is a priority in his company
“AI is in almost everything we do now,” she said.
To be clear, this does not mean that the company only invests in pure AI companies. He has supported AI companies in industries such as legal, customer service, sales, education and compliance, among others.
“We believe we are in the early stages of leveraging this technology and anticipate there will be significant opportunities to invest in multiple generations of AI companies in the years to come,” Meyers told Crunchbase News.
And the company doesn’t just talk the talk.
Bain sees AI as “a critical productivity multiplier for workers of all types,” including investors.
For example, she said, the company uses AI to automate tasks such as routine data analysis, summarizing large volumes of product feedback and benchmarking competitors.
“…We also increasingly recognize that we can’t just use AI – we must use it well, identifying areas where it can accelerate our efforts without eroding their substance or simply creating slop or noise,” Meyers added.
AI will also push adjacent sectors across the broader value chain, such as energy and semiconductors, which will most likely continue to attract significant attention, Founders Fund’s Windesheim noted.
Looking ahead, Meyers believes that supply chain, manufacturing and utilities “are huge and important sectors that need ways to better harness and leverage data and make processes systematic and ultimately AI-driven.”
She “worries” about economic models that rely on cross-border trade or logistics, given geopolitical uncertainty.
“And the first generation of relatively lightweight AI applications risks becoming redundant as basic models directly facilitate more and more use cases,” she said.
Invest smarter
Harley MillerFounder, CEO and managing partner of Left Lane Capital, based in Brooklyn, New York, said his firm was overall “cautiously optimistic” for the remainder of the year.
Valuations were recalibrated following the market correction that took place in the spring and summer of 2022, according to Miller, “anecdotally they felt good, until recently.”
“The madness of some AI haves and have-nots is pushing valuations to unprecedented levels, which frankly feel like 2021, especially for B2B/enterprise AI companies,” he added.
However, the broader review of valuations over the past two years has created, he believes, a healthier base.
“That said, the bar is higher now,” he said. “We expect this momentum to continue, particularly for companies with clear profitability trajectories and resonance with consumers. Fundamentals are back in focus, which is a net positive for the ecosystem.”
Consecutive rounds
Indeed, AI companies are rapidly increasing fundraising, thereby significantly increasing their valuations over short periods of time. Anthropic, for example, saw its valuation increase from $60 billion to $170 billion in the space of six months.
“There are many examples of AI companies running follow-up cycles in six to 12 months, versus the more typical two years or more,” Murphy said.
However, he expects there will inevitably be some “overfunding”.
“Many AI sectors are crowded and potentially undifferentiated, so investors need to choose intelligently where to invest rather than ‘gambling the index,’” Murphy added.
For now, Windesheim predicts that continued market growth and the opening of new markets will propel new waves of upside in and around AI.
“Overall, I think this positive market sentiment will continue in the short to medium term,” he said.
Meyers said she continues to see the valuation reflect the trajectory between rounds.
Companies that build momentum — maintaining or accelerating growth, innovating products, winning customer favor — raise funding rounds, often at valuations that give them credit for future growth, Meyers said.
However, she added, “companies that do not demonstrate momentum on these vectors, or whose speed slows, do not see significant increases.”
IPO prospects
Does all this mean we should expect to see more IPOs in 2025?
Despite a cloudy macroeconomic environment (like tariffs and inflation), recent IPO performance has opened the door to more IPOs, “but not the floodgates,” notes Meyers.
Companies including ServiceTitan, Carillon, Circle And Figma saw massive day-one showings during their public market debut, validating investors’ strong appetite for exposure to high-growth technologies. Even companies like CoreWeave “With a calmer start, we have achieved strong long-term performance,” she stressed.
Additionally, blockbuster profits from large technology companies investing heavily in AI are encouraging market enthusiasm.
“But there aren’t many companies like Figma — that have customer love, growth and high gross margins — so we can’t expect everyone to have a chance at an IPO,” Meyers said. “But the highest quality companies should feel more confident.”
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