Investors Pour $27.1 Billion Into A.I. Start-Ups, Defying a Downturn
The New York Times
Funding for A.I. firms made up nearly half the $56 billion in U.S. start-up financing from April to June, according to PitchBook.
For two years, many unprofitable tech start-ups have cut costs, sold themselves or gone out of business. But the ones focused on artificial intelligence have been thriving.
Now the A.I. boom that started in late 2022 has become the strongest counterpoint to the broader start-up downturn.
Investors poured $27.1 billion into A.I. start-ups in the United States from April to June, accounting for nearly half of all U.S. start-up funding in that period, according to PitchBook, which tracks start-ups. In total, U.S. start-ups raised $56 billion, up 57 percent from a year earlier and the highest three-month haul in two years.
A.I. companies are attracting huge rounds of funding reminiscent of 2021, when low interest rates and pandemic growth pushed investors to take risks on tech investments.
In May, CoreWeave, a provider of cloud computing services for A.I. companies, raised $1.1 billion, followed by $7.5 billion in debt, valuing it at $19 billion. Scale AI, a provider of data for A.I. companies, raised $1 billion, valuing it at $13.8 billion. And xAI, founded by Elon Musk, raised $6 billion, valuing it at $24 billion.
Such financing rounds have boosted the industry’s overall deal-making by dollar amount and number of deals, said Kyle Stanford, a research analyst at PitchBook.
