Venture capitalists have made their choice abundantly clear, according to BestBrokers research. AI gets everything whilst fintech, healthtech and mobile split what’s left over.
What’s happening: Artificial intelligence and machine learning-focused startups have attracted $192.7 billion in venture capital during the first three quarters of 2025, according to new analysis from financial services research firm BestBrokers.
Why this matters: The dramatic reallocation signals venture capital’s decisive shift towards AI infrastructure and applications, with traditional innovation sectors experiencing significant declines. Digital health investments have fallen 68 per cent since 2021, whilst AI now commands 30 per cent of all venture capital, raising questions about whether the concentration creates systemic vulnerabilities in the startup ecosystem.
Even as venture capital activity slowed in 2025, artificial intelligence startups have shattered funding records, attracting nearly $193 billion in the first three quarters of the year whilst traditional technology sectors struggle to compete for investor attention.
The BestBrokers analysis, which examined data from PitchBook, CB Insights and recent venture capital firms’ filings, reveals that AI and machine learning-focused deals generated $192.7 billion across 8,069 transactions. The figure represents a 150 per cent increase from 2020, when AI venture capital deals totalled $77 billion.
“Over the past decade investment in artificial intelligence has skyrocketed from around $14 billion in 2015 to nearly $193 billion for the first three quarters of 2025,” said Paul Hoffman from BestBrokers.com. “What was once a niche frontier of venture capital is now a gravitational centre that fuels funding rounds and valuations in a variety of sectors beyond just AI.”
Capital concentration
The scale of AI’s dominance becomes clear when compared to other major technology verticals. Software as a service, the second-largest category, attracted $164.8 billion across 6,238 deals. Big data startups secured $104.4 billion through 1,705 transactions, whilst manufacturing companies raised $42.6 billion.
By contrast, fintech attracted just $36 billion across 2,760 deals, healthtech raised $28.3 billion through 2,368 transactions, and mobile startups secured $41.2 billion in 2,235 deals. The combined $105.5 billion raised by these three sectors falls significantly short of AI’s total.
As AI startups captured record levels of venture capital, with North America alone securing 63 per cent of global AI funding Dynamic Business, the concentration has sparked debate about whether capital allocation has become too heavily skewed towards a single technology sector.
“Venture capital deals in AI have not only broken their own records but now, they surpass the combined value of investments in fintech, healthtech, and mobile startups,” Hoffman added. “It is clear that AI is not just a hype, it has become the defining technology of the decade, so this is where the big bets are being placed.”
Traditional sectors decline
Traditional innovation hubs have experienced notably slower deal flows in 2025. Healthtech investments reached $28.3 billion, whilst digital health-focused deals totalled $9.5 billion. These figures represent significant declines from 2021, when these fields attracted $67.7 billion and $29.3 billion respectively.
The shift reflects a broader pattern in which venture capital deals fell to a nine-year low whilst AI deals raised approximately $50 billion in a single quarter, representing around half of the entire venture capital investment for that period.
Clean technology companies raised $24.4 billion across 2,141 deals, whilst robotics and drones startups secured $23.1 billion through 1,065 transactions. Life sciences attracted $31.2 billion across 2,079 deals.
The decline in healthtech and digital health funding highlights how capital has migrated towards artificial intelligence. Whilst these sectors commanded significant investment during the pandemic, recent years have seen venture capitalists shift focus to AI infrastructure and applications.
SaaS holds ground
Software as a service has maintained strong performance despite AI’s dominance. The sector generated $164.8 billion in venture capital deals during the three quarters ending 30 September 2025, demonstrating continued investor confidence in subscription-based software models.
The AI funding trajectory shows consistent growth over the past decade, with notable acceleration in recent years. From $14.4 billion in 2015, investments grew to $20.2 billion in 2016, $32 billion in 2017, and $58 billion in 2018. The sector reached $59.1 billion in 2019 before jumping to $77 billion in 2020.
The 2021 peak of $167.9 billion was followed by a correction to $112.4 billion in 2022 and $96.9 billion in 2023. However, 2024 saw a resurgence to $148.3 billion, with 2025’s three-quarter total of $192.7 billion suggesting a new record will be established.
Healthtech retreats
The concentration of capital in fewer, larger deals marks a shift from previous venture capital patterns. Investors appear to be making bigger bets on established AI platforms and infrastructure providers rather than distributing capital across numerous early-stage startups in diverse sectors.
Market observers note that whilst AI companies continue to demonstrate technological advancement, the extreme concentration of venture capital could create vulnerabilities if these companies fail to translate technological promise into sustainable business models.
The BestBrokers research suggests AI investment has moved beyond speculative interest into sustained commitment from institutional investors. However, the parallel decline in sectors such as digital health and fintech raises questions about whether potentially valuable innovations in these fields may struggle to secure necessary capital in an AI-dominated funding environment.
Additional information on VC investments, major AI deals, and our complete research methodology can be found in the full report.
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