As we look back at the year 2024, it is evident that funding for generative AI has reached unprecedented levels, with this momentum showing no signs of waning. Below is an overview of the critical statistics and advancements that characterised the year.
Highlights
Quarterly Funding Highlights
In the third quarter of 2024, there was a remarkable performance in venture capital investments aimed at generative AI startups. According to PitchBook, venture capitalists invested a total of $3.9 billion across 206 deals during this timeframe. Notably, this amount does not include the impressive $6.6 billion funding round achieved by OpenAI.
Geographical Distribution of Funding
Out of the $3.9 billion invested in Q3 2024, an impressive $2.9 billion was allocated to companies based in the United States, spread across 127 deals. This significant capital deployment in the U.S. marketplace highlights the nation’s dominant role within the generative AI sector.
Notable Funding Rounds
Several organisations distinguished themselves with considerable funding rounds:
- Magic, a coding assistant, secured $320 million in August.
- Glean, an enterprise search company, raised $260 million in September.
- Hebbia, a business analytics firm, closed a $130 million funding round in July.
- Moonshot AI, a company based in China, raised $300 million in August.
- Sakana AI, a Japanese startup dedicated to scientific discovery, obtained $214 million.
Industry Growth and Projections
The generative AI sector is witnessing rapid expansion. The global market value is anticipated to exceed $66 billion by 2024, marking an increase of nearly 50% compared to the previous year. The U.S. market alone is expected to surpass $23 billion by the end of 2024, representing over a third of the global revenue.
Looking to the future, the global market is projected to grow beyond $88 billion in 2025 and exceed $110 billion by 2026. By 2030, the total market value is estimated to reach nearly $207 billion, signifying more than a fourfold increase since 2023.
Investment Trends
Investments in generative AI have experienced considerable oscillations yet are currently trending upwards. Global investment in generative AI saw a fourfold increase from 2022 to 2023, totalling $21.8 billion. This remarkable surge was primarily fuelled by substantial funding in organisations such as OpenAI, which secured $10 billion in 2023—accounting for almost half of the total funding within the industry that year.
As we transition into 2025, it is clear that the funding landscape for generative AI has dramatically evolved, with no indication of a slowdown in sight.