Global venture capital investment rose to a five-quarter high in the second quarter of 2024, from $75.3 billion in the first quarter to $94.3 billion. This is shown by the latest Venture Pulse 2024 from KPMG.
This development is mainly due “to very large investments of over $1 billion, more than half of which were made in the field of artificial intelligence (AI).”
Venture capitalists are also investing “heavily in the technology in Europe. Investments rose from USD 13.9 billion in the first quarter of 2024 to USD 17.8 billion in the second quarter.”
On the one hand, investors are “interested in companies that develop basic AI technologies. On the other hand, companies that use AI to improve business models, for example to better monitor customer experience or simplify product development, are also receiving financial support.”
The most significant AI investments “were made in start-ups that develop large language models and in companies that want to use artificial intelligence for specific industries or in certain functions.”
These include healthcare, biotechnology and supply chain logistics. Investors are also continuing to “invest in alternative energies and sustainable technologies.”
The huge increase in venture capital investment in AI shows “the continuing high expectations of investors in forward-looking technologies such as large language models.”
The technology is here to stay and “will play a key role in the global economy.”
Germany is among the top 10 countries in Europe “for venture capital investments, although these remained virtually unchanged at USD 2.2 billion in the second quarter of 2024.”
The AI-driven deep tech company DeepL alone “raised around USD 300 million.”
Venture capitalists in Germany were also “particularly interested in fintech companies, while interest in cryptocurrencies continued to decline compared to the previous quarter.”
Investors also invested in German ESG companies “that focus primarily on the business-to-business (B2B) sector.”
Germany confirms its position “among the top 10 European investment locations, with constant investments and remarkable successes in key technologies.”
The commitment to Fintechs and sustainable ESG companies, “particularly in the B2B sector, as well as the success of lighthouses such as DeepL reflect the country’s thriving innovation climate.”
