The U.S., which accounts for about half of all venture funding, mirrored these global trends with funding to U.S.-based startups totaling $138 billion, down by 37% year over year. Other sectors such as Web3, financial services, e-commerce, and media and entertainment also saw significant declines in funding. The report suggests that without an increase in exits, 2024 will continue to be challenging for founders in a funders market.
Key takeaways:
- Global startup funding in 2023 reached $285 billion, marking a 38% decline year over year, making it the lowest for venture funding since 2018.
- Despite the overall decline, AI was the largest sector to show an increase in funding, reaching close to $50 billion last year, up 9% from the previous year.
- Web3, financial services, e-commerce and shopping, and media and entertainment sectors saw significant declines in funding in 2023.
- The fourth quarter of 2023 marked the lowest quarter for global venture funding, with seed funding, early-stage funding, and late-stage funding all experiencing declines.