The months after ChatGPT’s release might have seemed like peak hype for generative AI, but it wasn’t until 2024 that the excitement translated into a real breakout year for startups built on the technology.
AI startups pulled in $101 billion last year, a more than 80% jump from the $55.6 billion invested in 2023, according to a recent year-end report from Crunchbase. That marks the biggest year in a decade for AI startups, which previously clocked an $83 billion record in 2021.
But the funding frenzy around AI skewed an otherwise lukewarm venture market; overall funding grew only 3%—$10 billion—from 2023 to $314 billion, well below the boomtime highs of 2021 and 2022.
A hopeful endnote: Despite the lack of huge growth in the overall funding market, Crunchbase senior data editor Gené Teare told Tech Brew an uptick in the final quarter of 2024 generated some optimism going into the new year.
“What’s changed year over year is the mood in 2024 is very, very different, and we saw a big pickup in Q4,” Teare said. “There’s a little bit more excitement this year than there was a year ago in the venture markets, even though year over year, it kind of looks the same.”
Keep reading here.—PK
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