State of the Markets H2 2025 (b2venture)

Summary

• Over 36% of US venture capital raised over the last three years went to funds at least $1B in size, up from 22% six years ago.p.13
• Near two-thirds of US VC dollars are flowing into deals over $500M, while mega-deals made up only 18% of total investment at the 2021 peak.p.15
• Around 12% of venture deals in 2025 have been down rounds, with company failure rates peaking in late 2024 at 1 in 5 companies winding down.p.16
• Three-quarters of VC-backed tech companies are growing, and 63% of those growing companies are profitable or showing improving profitability.p.20
• Artificial intelligence deals attract high premiums, with median Series A AI companies burning $5 to gain $1 of new revenue compared to $3.60 for non-AI peers.p.27
• In 2025, 46% of startup M&A transactions involved a VC-backed buyer, but 90% of all M&A deals have undisclosed financial details.p.30

Key insights

1. At least 59 of the top 100 highest valued US unicorns have a foreign-born founder, representing more than $1.5T in aggregate market value.p.10
2. Liquidity-sensitive LPs such as pensions, endowments, and foundations account for nearly 40% of committed capital in typical VC funds.p.14
3. Venture deals involving AI companies capture over 58% of total capital deployed, while making up 36% of total deal count.p.15
4. Startups backed by mega manager platforms like a16z, Tiger Global, or General Catalyst command a 171% valuation premium at Series D relative to non-mega manager deals.p.16
5. Only 9% of seed startups from 2022 graduated to Series A within 36 months, down from 22% of seed startups in 2020.p.17
6. Fintech received nearly 30% of total VC investment in New York in 2024, more than double the national average of 13%.p.18
7. Capital expenditures among the top five big tech companies jumped approximately 67% since the launch of ChatGPT.p.25
8. Only 2% of present-day tech unicorns have achieved an annual revenue level of $1B.p.26
9. Seed-stage startups funded in 2024–2025 launch with an average team size that has four fewer employees compared to the 2019 seed cohort.p.28