Key Takeaways
After most facets of the innovation economy found market bottom in 2024, all eyes are on AI as a key driver of momentum in 2025. Our latest State of the Markets report finds a healthy recovery underway at the company level and potential for lower interest rates to provide the liquidity needed to end the three-year exit drought.
48% Of venture investment went to AI-powered companies in 2024
This level of interest marks a third consecutive quarter of growth for companies that leverage AI.
8% Increase in year-over-year burn rate for the median Series B company
Companies that successfully raised capital in 2024 managed their burn rates effectively.
50% Share of US VC-backed tech companies cash out in 12 months
Suppressed investment continues to pressure company runway, as companies turn to extension rounds as a stopgap.
The bar is higher for Series A
The median Series A company now has $2.5M in annual revenue — 75% higher than companies had in 2021.
This development has coincided with more companies raising multiple seed rounds and a bottleneck of seed-stage companies seeking to raise a Series A.
Source: PitchBook Data, Inc. and SVB proprietary data and analysis.
Source: PitchBook Data, Inc. and SVB analysis.
Valuation growth has slowed
It now takes the typical Series A company more than two years to increase its valuation as much as companies in 2021 did in a single year.
Rising demand for capital amid lower supply and slower growth rates for VC-backed companies have driven revenue multiples lower.
Forecasts hinge on the prospects for AI
In 2024, more mega deal dollars went to AI companies ($73B) than non-AI companies ($47B) for the first time.
This inflection could mark the beginning of a rebound similar in magnitude to the one sparked by the rise of mobile technology after the global financial crisis.
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