Venture capital firms focused on artificial intelligence are driving much of the growth in the startup market, while companies in other areas are struggling to raise cash, according to a report from Silicon Valley Bank. About 40% of the total amount raised by U.S. venture funds last year was from funds that “list AI as a focus,” SVB said in its “State of enterprise software” report published on Tuesday. That’s up from 10% in 2021. AI companies accounted for 45% of U.S. venture investment in enterprise software, jumping from 9% in 2022. The dollars from AI megadeals — rounds of $100 million or greater — represented about half of all the money raised in the overall megadeal category. That’s a group that includes OpenAI and Anthropic. “Exclude AI investment and the story changes,” the SVB report said. “There is no meaningful uptick for companies not leveraging AI, with investment from this group essentially flat for the last year.” The challenge for the broader market is that exit activity remains tight, a theme that’s been in place since soaring inflation in late 2021 led to rising interest rates and a move out of risk. Many investors were bullish that President Donald Trump’s return to the White House would reinvigorate the startup economy due to the prospect of lower taxes and less regulation, but the aggressive tariff policy announced in early April led several companies to delay planned IPOs.

Full report : Silicon Valley Bank said in a report published on Tuesday that about 40% of the money raised by U.S. startups last year came from funds focused on AI.