Global VC Funding Activity to Remain Flat in 2025; Total Value of Deals to Rise by Only 1.8% Year-over-Year to $544 Billion

July 21, 3:12 am

Although artificial intelligence, IT, healthcare, and biotech companies continue raising billions of dollars in funding rounds, the broader VC funding market faces headwinds from geopolitical instability, economic uncertainty, and high interest rates. As a result, the total value of deals is expected to grow by only 3% in 2024, following a 4.2% decline in 2023. The market projections for the next year show similar activity.

According to data presented by AltIndex.com, global VC funding activity is expected to remain flat in 2025, with the total value of deals rising by only 1.8% to $544 billion worldwide.

Total Value of Deals to Remains 10% Lower than in Record 2021

Global economic headwinds have significantly impacted VC investors' appetite in the past two years, causing the total value of deals to fall sharply in 2022 and 2023. Since the market peak in 2021, when companies across the globe raised a record $618 billion in funding rounds, the total value of deals plunged by 16%, falling to $518 billion in 2023.

Although 2024 is expected to bring a slight recovery, the capital raising market is still experiencing a mix of cooling trends and growth areas. While tech, AI, healthcare, and biotech sectors have seen robust activity in the first half of the year, the broader market is still far from its peak, showing VC investors remain cautious and selective.

As a result, the total value of deals will rise by only 3.1% to $534 billion by the end of the year. According to the latest Statista market projections, similar activity will continue in 2025. Statista expects the total value of deals in the VC market to increase by a modest 1.8% and reach $544.2 billion next year. That means the VC market will grow slower than the digital capital raising sector or the global capital raising market.

Statistics show the deal activity in the digital capital raising sector, including crowdfunding, crowdinvesting and crowdleding, will grow by 3.4% to $70.8 billion in 2025. At the same time, the total value of deals in the global capital raising market is forecasted to increase by 2% year-over-year.

Chinese Market Facing VC Funding Decline in 2025, US and European Markets to See a Modest Growth

While the global VC market is expected to remain flat, there are still differences between the regions and countries. According to Statista, the US market will see the biggest growth in 2025, with the total value of deals rising by 2.4% to $303.6 billion, representing 55% of the world's total.

The European market closely follows with a 2.3% year-over-year growth and a projected $31.3 billion capital raised next year. On the other hand, the Chinese market, the second largest globally, will see a negative trend, with the VC funding activity falling by 0.3% to $119.9 billion in 2025.

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