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Alternative Market Briefing

Global VC investment drops 21% in Q2 to $101bn

Wednesday, September 10, 2025

Laxman Pai, Opalesque Asia:

Global venture capital funding slid 21% in the second quarter of 2025 to $101.05 billion from $128.4 billion in Q1, a drop driven largely by OpenAI's $40 billion megadeal earlier this year.

Stripping out that outlier, Q2 activity held up well, underpinned by steady investor appetite in AI, defence tech, and space tech. Adjusted for the megadeal, the data points to a more resilient VC market despite prevailing headwinds.

According to the Q2'25 Venture Pulse Report by KPMG, Q2'25 was a relatively strong quarter for venture capital investment in the Americas, with $72.7 billion raised across 3,425 deals. While this marked a decline from $98.5 billion and 4,048 deals in Q1, the comparison is skewed by OpenAI's $40 billion raise in the previous quarter. Excluding that outlier, Q2 reflected sustained investor momentum - particularly in AI, defencetech, and spacetech. The US accounted for $70 billion of the Americas' investment total - and for nearly 70 percent of all VC investment globally.

In Europe, VC investment showed resilience quarter-over-quarter, dipping only slightly from $16.3 billion across 2,358 deals in Q1 '25 to $14.6 billion across 1,733 deals in Q2 '25. Meanwhile, VC investment in Asia remained at near-record lows - with $12.8 billion invested across 2,022 deals in Q2'25 compared to $12.6 billion across 2,663 deals in Q1'25 - driven largely by a slowdown in China, where VC investment fell to i......................

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