Venture Capital Trends in AI 2024

AI investments dominated VC in 2024.

Hey Everyone,

As I get out of my winter slumber I’ve been mulling over the State of AI in Venture capital that was 2024. As Anthropic is talks to raise yet another $2 Billion at a semi-crazy valuation jump to $60 billion, xAI has raised so much in 2024 as well. OpenAI are going to charge an arm and a leg for their o3 model no doubt as they bleed money in 2025 like we’ve never seen before!

Sam Altman talks about Superintelligence, even as his baby sister sues him. It’s Imperialism all around in the Venture Capital community, and monopoly capitalism means BigTech have nearly complete control (at least in their minds) over the path of Generative AI now. U.S. exceptionalism at the dawn of the last era of Trump.

It’s power games and politics, where who you know is weaponized. Microsoft is promising $80 Billion on capex in AI in 2025 while President-elect Donald Trump announced a $20 billion foreign investment to build new data centers in the United States. Emirati billionaire Hussain Sajwani, a Trump associate and founder of the property development company DAMAC Properties, is pledging the money.

Silicon Valley is eating the world of AI startups:

Silicon Valley is so dominant again, its startups devoured over half of all global VC funding in 2024. (TechCrunch)

Amazon has such a massive amount of equity in Anthropic, it might be even more than Microsoft will end up having in OpenAI.

AI Startup Funding Hit a Record $97 Billion in 2024, but that’s mostly just OpenAI, xAI, Anthropic and a few big raises. It was another dead year for IPOs, M&A which had its fair share of sad exits, reverse acquisitions and consolidation.

The same names keep funding early stage AI startups:

All the while Google keeps trying to pretend its agile as an AI innovator, as Claude and OpenAI have become a frontier model Duopoly, only because they are owned by the America Cloud Titans.

The entire internet feels more dominated by Venture Capital interests with many even in the next U.S. administration, and in advisory councils like a shadow government. It only cost Elon Musk a few hundred million to get in the good graces of Donald Trump. OpenAI’s corporate board is full of Facebook Mafia, CIA, NSA types with their CEO thinking its fine to borrow Billions.

AI in 2024 has reshaped the venture landscape, capturing a record share of funding (37%) and deals (17%) in 2024, including 5 of the year’s largest deals.

• Databricks

• OpenAI

• xAI

• xAI (II)

• Anthropic

But what really got my attention?

Nvidia is redefining the AI investment game, pouring $1 billion into 50 AI-focused startups in 2024 alone more than Amazon and Microsoft combined. Their bets are also among the best. They ain’t no Softbank Vision Fund who apparently have no idea how to do due diligence.

While America looks great, the developing world didn’t in VC in 2024. VC investments in emerging markets such as the Middle East and North Africa (MENA) plummeted by over 40% compared to 2023, according to a new report.

The emphasis on AI is also feeling like American PR and propaganda has taken over their Tycoon owned social media channels:

Almost half of the total $209 billion raised by US startups last year went to AI companies - Pitchbook

Even as the challenges for OpenAI appear dire and Sam Altman appears over his head. But how much longer will we be forced to listen to his Podcasts and talks? Let’s just get on with it. He’s become a caricature along with Elon Musk of how corrupt the times are that we live in.

AI has emerged as a dominant sector within the venture capital landscape, capturing approximately 37% of total venture capital funding and 17% of all deals in 2024. These figures are all-time highs, indicating a robust interest from investors in AI-driven solutions.

But even as these Monopoly startups and glorified research labs dominated, startups and VC funds didn’t fare too well in 2024. It’s important to note. The total amount of funding for startups ticked up for the year, rising by about one-third from 2023. Meanwhile, VCs themselves raised $76.1 billion for 508 funds, the lowest number since 2014, and the lowest dollar amount since 2019.

Now with a datacenter acceleration and the Nuclear power required for the 2030s, it’s going to need just insane Capex. A lot of the high margins and deep pockets of BigTech will be put to the test in a kind of AI positioning for the next 15 year cycle. Not everyone is keeping up, Apple Intelligence was a particularly poor roll-out in 2024 along with Amazon and Microsoft’s Copilot offerings. Google was lacklustre until a good December Gemini 2 launch. That leaves Nvidia, Meta and Broadcom as strategic winners among the most valuable companies getting more influential and into AI in 2024.

AI winners of 2024 in BigTech:

• Nvidia

• Meta

• Broadcom

Losers:

• Apple

• Amazon

• Microsoft