Innovation Economy Update H1 2026 (J.P. Morgan Payments)

Summary

• Software ranks first by capital invested in H2'25-H1'26 with $357.7B across 4,780 deals.p.5
• Applied Tech capital invested reached $80.8B, with deal count up 19%.p.5
• Payments recorded 1,940 deals and $34.9B of capital invested in H2'25-H1'26.p.5
• San Francisco leads regions with 2,490 deals and $379.4B invested, followed by New York with 1,657 deals and $37.3B.p.6
• AI captures a disproportionate share of funding, particularly through a growing concentration of very large rounds, with capital spread across the fewest deals this decade.p.2

Key insights

1. Subdued exit markets remain a persistent overhang, as muted IPO and M&A environments slow the recycling of capital.p.2
2. The venture market is bifurcated: fundraising is favorable for some founders and prolonged for others.p.2
3. Life Sciences invested $50.9B and HealthTech $38.4B in H2'25-H1'26.p.5
4. Mega-rounds are defined as funding rounds of $100M or larger.p.5
5. AI is a top sector in every tracked region, alongside SaaS, Fintech, HealthTech and others.p.6