Artificial intelligence startups attracted most of the global venture capital in Q1 2025. According to Pitchbook data, AI and machine learning companies secured 58% of all VC dollars during the quarter. This marked a sharp rise from 28% in the same period of 2024.

Pitchbook released its findings on April 17. The research firm noted that investor demand for AI continues to grow rapidly. “Investors still have an AI FOMO [fear of missing out] problem,” the firm stated.

Surge in AI Funding Led by OpenAI and Anthropic

AI startups raised a total of $73 billion in Q1 2025. This amount was over half the total AI venture funding recorded in 2024. A large portion of the capital went to OpenAI, which closed a $40 billion round led by SoftBank on March 31.

Other AI firms also attracted major investments. Anthropic raised $3.5 billion in a Series E round in March. Pitchbook noted that 70% of venture capital in North America went to AI firms. This shows the regional focus on AI as a leading investment area.

Maria Palma of Freestyle Capital said, “The fear of somebody else winning your market has never been higher.” She added that the pace of AI innovation remains extremely fast.

Venture Capitalists Warn of Market Overheating

Nnamdi Okike, co-founder at 645 Ventures, shared concerns about over-investment. He said, “That’s usually a recipe for failure when you’re becoming detached from reality.”

Pitchbook’s analysis suggests AI funding growth may face correction if market expectations do not align with real results. However, the current data shows continued investor interest and momentum in AI ventures.

Crypto Venture Capital Sees Modest Recovery

In contrast, crypto and blockchain startups raised $4.8 billion in Q1, according to CryptoRank. This was still over four times higher than Q4 2024, which saw only $1.1 billion in deals.

Nearly $2 billion of the Q1 crypto funding came from MGX’s investment in Binance. Crypto venture capital investment in this quarter surpassed previous levels since the third quarter of 2022.

The fund directed by Mike Novogratz through Galaxy Ventures Fund I exceeds its original $150 million goal. The fund shows potential to reach $180 million by June 2025 before it stops accepting investments. A recovery trend emerges in American crypto venture capital investments because of enhanced regulatory understanding in the country.